Guy Ryder says decent work key to reducing poverty, inequality and breaking out of the slow growth trap
In statements to the International Monetary and Financial Committee and the World Bank Development Committee in Washington, the head of the ILO noted that against the backdrop of slowing growth, the outlook for labour markets remains troubled and likely to worsen.
7 October 2016
WASHINGTON (ILO News) – Eight years on the world economy has not fully recovered from the global financial crisis and there is a high risk that it will remain stuck in a slow growth trap unless urgent coordinated action is taken to boost growth and make it more inclusive, ILO Director-General, Guy Ryder, said.
ILO Director-General highlighted that there are over 70 million women and men not in work today who would have had a job if pre-crisis growth had resumed. With the latest downward revisions in growth prospects the jobs gap could rise to over 80 million by 2020.
“Global real wage growth dropped sharply during the crisis, recovered in 2010 but has since decelerated. If China, where wage growth was faster than elsewhere is not included, wage growth fell to below the one per cent per annum recorded in the crisis years,” Ryder said. “Increasing decent work opportunities and improving wages are key to breaking out of the slow growth trap and rekindling a virtuous circle of increased investment, rising productivity and sustainable enterprise and wage and consumption growth.”
According to surveys in 28 countries, a quarter of young people aged between 15 and 29 years old are neither employed, nor in education or training (NEET), a status which carries risks of underemployment, skills deterioration and discouragement. In addition, between 1995 and 2015, the global female labour force participation rate decreased from 52.4 to 49.6 per cent. Worldwide women earn 77 per cent of what men earn.
“It is estimated that 156 million employed youth, or 38 per cent of working youth in emerging and developing countries are living in extreme or moderate poverty. The potential of the generation that must work to achieve the 2030 Agenda’s sustainable development goal is being wasted,” Ryder said.
“Investing in gender equality at work and in enabling women and men to balance work and family responsibilities is a top priority in structural reform of the labour market and increasing the productive potential of the world’s workforce,” he added.
The ILO Director-General also noted that the ILO and the World Bank’s shared objective is to increase the number of countries that can provide universal social protection, supporting countries to design and implement universal and sustainable social protection systems.
“Universal social protection refers to the integrated set of policies designed to ensure income security and support to all people across the life cycle – paying particular attention to the poor and the vulnerable,” Ryder said.
In this context, he drew attention to the ILO/IFC Better Work programme operating in eight developing nations around the world and targeted on garment supply chains. The programme is reducing the prevalence of abusive workplace practices, increasing productivity and pay and reducing excessive working hours, and creating positive effects outside the factory for workers and their families.
The ILO Director-General also highlighted that considerable shifts in employment driven by openness to international trade and investment “call for strengthened labour market institutions” to ease worker mobility, increase training, promote sustainable wage setting, ensure adequate social protection, improve working conditions and enhance respect for international labour standards.
“The widely ratified ILO conventions on Fundamental Principles and Rights at Work are key benchmarks for international investment and trade governance mechanisms. Their near-universal acceptance, which demonstrates the value of ILO membership, has allowed them to become the globally accepted baseline for fair treatment in the workplace and a starting point for addressing labour conditions and sustainable development,” he said.
“The successful and ongoing ILO-Bank collaboration in Uzbekistan to monitor the cotton harvest for child and forced labour has also provided a useful template of how the ILO and World Bank can work together to assist countries to build their capacity to implement labour standards in the context of World Bank projects.”
ILO Director-General highlighted that there are over 70 million women and men not in work today who would have had a job if pre-crisis growth had resumed. With the latest downward revisions in growth prospects the jobs gap could rise to over 80 million by 2020.
“Global real wage growth dropped sharply during the crisis, recovered in 2010 but has since decelerated. If China, where wage growth was faster than elsewhere is not included, wage growth fell to below the one per cent per annum recorded in the crisis years,” Ryder said. “Increasing decent work opportunities and improving wages are key to breaking out of the slow growth trap and rekindling a virtuous circle of increased investment, rising productivity and sustainable enterprise and wage and consumption growth.”
According to surveys in 28 countries, a quarter of young people aged between 15 and 29 years old are neither employed, nor in education or training (NEET), a status which carries risks of underemployment, skills deterioration and discouragement. In addition, between 1995 and 2015, the global female labour force participation rate decreased from 52.4 to 49.6 per cent. Worldwide women earn 77 per cent of what men earn.
“It is estimated that 156 million employed youth, or 38 per cent of working youth in emerging and developing countries are living in extreme or moderate poverty. The potential of the generation that must work to achieve the 2030 Agenda’s sustainable development goal is being wasted,” Ryder said.
“Investing in gender equality at work and in enabling women and men to balance work and family responsibilities is a top priority in structural reform of the labour market and increasing the productive potential of the world’s workforce,” he added.
The ILO Director-General also noted that the ILO and the World Bank’s shared objective is to increase the number of countries that can provide universal social protection, supporting countries to design and implement universal and sustainable social protection systems.
“Universal social protection refers to the integrated set of policies designed to ensure income security and support to all people across the life cycle – paying particular attention to the poor and the vulnerable,” Ryder said.
In this context, he drew attention to the ILO/IFC Better Work programme operating in eight developing nations around the world and targeted on garment supply chains. The programme is reducing the prevalence of abusive workplace practices, increasing productivity and pay and reducing excessive working hours, and creating positive effects outside the factory for workers and their families.
The ILO Director-General also highlighted that considerable shifts in employment driven by openness to international trade and investment “call for strengthened labour market institutions” to ease worker mobility, increase training, promote sustainable wage setting, ensure adequate social protection, improve working conditions and enhance respect for international labour standards.
“The widely ratified ILO conventions on Fundamental Principles and Rights at Work are key benchmarks for international investment and trade governance mechanisms. Their near-universal acceptance, which demonstrates the value of ILO membership, has allowed them to become the globally accepted baseline for fair treatment in the workplace and a starting point for addressing labour conditions and sustainable development,” he said.
“The successful and ongoing ILO-Bank collaboration in Uzbekistan to monitor the cotton harvest for child and forced labour has also provided a useful template of how the ILO and World Bank can work together to assist countries to build their capacity to implement labour standards in the context of World Bank projects.”