South Asia sees additional jobseekers

South Asian labour markets continued to suffer from high rates of informal/agricultural employment where jobs are poorly paid and unprotected, according to a report.

Global Employment Trends 2014 revealed that between 2012 and 2013 global unemployment increased by almost five million to 202 million, and more than 45 per cent of these additional jobseekers were in East Asia and South Asia, said International Labour Organisation (ILO).

In South Asia employment is still focused around informal and agriculture work, which is generally poorly paid and lacks social protection, the annual report stated. "Overall, more than three-in-four workers are classified as in vulnerable employment, a proportion that has fallen only slightly in recent years. Around one-in-two workers are in agriculture and only one-in-five receive a salary or wage. Labour force participation rates remain among the lowest in the world – some 56 per cent in 2013 – driven by the low proportion of women in the workforce. Where women do work they tend work in less productive jobs with lower earnings."

Slower economic growth combined with domestic issues may make labour market improvements difficult in the near future, it said, adding that increasing investment in skills and infrastructure, combined with a large pool of young people, however, shows that some of the elements for creating more decent work are in place.

More than 50 per cent of Asia Pacific workers are in the informal sector – with little or no access to employment, health or social security – a higher proportion than any other global region except Latin American and the Caribbean.

The weak global economic recovery failed to translate into an improvement in the world’s labour markets in 2013, and as global unemployment worsened the largest increases came in East Asia and South Asia, it said, expressing concern about the quality of employment in Asia and the Pacific. "In particular it notes the persistence of widespread informal employment and working poverty, and the significant challenges in finding decent work faced by young people and, in some countries, women."

The report noted that global economic recovery means profits are being made in many sectors, but these are mainly going into asset markets and not into the real economy, damaging long-term employment markets.

The authors estimated that with current trends an additional 200 million jobs will be created by 2018, but this will not be enough to absorb the growing number of new labour market entrants.

“What is urgently needed is a policy re-think,” said ILO director-general Guy Ryder. "Stronger efforts are needed to accelerate employment creation and to support enterprises that create jobs.”

“It is imperative that active labour market policies be implemented more forcefully to address inactivity and skills mismatch,” said head of the Employment Trends Unit at the ILO Research Department and the main author of the report Ekkehard Ernst.

The report stressed the pressing need to integrate young people into the labour force. At present, some 74.5 million men and women under the age of 25 are unemployed, a global youth unemployment rate of over 13 per cent – over two times more than the overall global unemployment rate.

In developing countries, informal employment remains widespread, and the pace of improvements in job quality is slowing down. That means fewer people are moving out of working poverty. In 2013, the number of workers in extreme poverty – living on less than
$ 1.25 a day – declined by only 2.7 per cent globally, one of the lowest rates over the past decade, with the exception of the immediate crisis years.
Global recovery in labour markets is being held back by a deficit of aggregate demand. In many developed economies, harsh reductions in public spending and hikes in income and consumption taxes weigh heavily on private businesses and households.

While there are still almost 380 million own-account and contributing family workers, hundreds of millions of workers have moved into formal, salaried employment and working poverty is shrinking rapidly – since 1991 almost 465 million workers have moved out of poverty.

The report found that, despite signs of a weak economic recovery, global employment continued to stall in 2013 as the number of jobless rose to over 202 million. The report also analyses why rising corporate profits and strong equity markets last year failed to stimulate job growth.
As countries around the world struggle to emerging from on-going jobs crisis, this event is a unique opportunity to discuss the issue with a leading employment expert.

The report also suggested a switch to more employment-friendly policies and rising labour incomes would boost economic growth and job creation. "In both emerging and developing countries it is crucial to enhance investment in skills development, strengthen social protection floors and promote transitions to formal employment," it concluded.