With half the world's workers unable to earn enough to rise above the $2 a day poverty line, fairer globalization and better jobs are vital to achieving the United Nations Millennium Development Goal (MDG) of halving the number of global poor by 2015, according to a new report published today.
Of some 2.8 billion people employed globally in 2003 – more than ever before – nearly 1.4 billion – also the highest number ever – are living on less than $2 a day, with 500 million on less than $1, although the actual percentage is lower today than in 1990, the UN International Labour Office (ILO) World Employment Report 2004-2005 says.
The share of people working under $2 a day has declined to 49.7 per cent in 2003, from 57.2 per cent in 1990, and may drop to around 40 per cent in 2015.
"The key to reducing the number of working poor is creating decent and productive employment opportunities and promoting a fairer globalization as strategies for poverty reduction," ILO Director-General Juan Somavia said. “It is not only the absence of work that is the source of poverty, but the less productive nature of that work. Productivity growth, after all, is the engine of the economic growth that enables working men and women to earn enough to lift themselves out of poverty."
The report calls for increasing productivity and earnings in agriculture since a large share of workers in this sector are informally employed and living in poverty. Agriculture employs over 40 per cent of developing countries' workers and contributes over 20 per cent of their gross domestic product (GDP).
It notes that those regions that have managed to increase productivity in the longer run and to create job opportunities are more likely to be on track to reach the MDG of halving poverty by 2015.
There is a chance to halve the global proportion of $1 a day working poor by 2015 since the global annual GDP growth rate needed would be 4.7 per cent, less than the 5 per cent rate projected between 1995 and 2005. This projection is heavily influenced by rapid growth in China, Southeast Asia and South Asia. Transition economies and the Middle East and North Africa should also meet the goal. But Latin America and the Caribbean most likely will not and sub-Saharan Africa is significantly off track.
The outlook for halving $2 a day working poverty, however, is less promising. Only East Asia has a realistic chance, whereas none of the other regions will succeed unless their GDP growth rates increase considerably.