Citing global economic instability, UN predicts 5 million more jobless this year

The United Nations labour agency predicts that economic turbulence resulting from credit market turmoil and rising oil prices could lead to another 5 million people becoming unemployed this year.

That is just one of the key findings the International Labour Office (ILO) released today in its annual Global Employment Trends report, which analyses the impact of factors – ranging from population and economic growth to financial crises – on labour markets.

The report notes that the decrease in growth in developed economies owing to the credit market crisis and higher oil prices had so far been “compensated for in the rest of the world,” especially in Asia, which has witnessed strong economic and job growth.

However, an expected slowdown in growth during 2008 could increase the global unemployment rate to 6.1 per cent, resulting in an increase of at least 5 million unemployed worldwide, the report warns.

The forecast for this year differs from 2007, considered by ILO to be a “watershed year” in that it saw a stabilization of global labour markets with more people in work, some 45 million new jobs and only a small increase in the number of those unemployed, to a total of nearly 190 million worldwide.

“This year’s global jobs picture is one of contrasts and uncertainty,” said ILO Director-General Juan Somavia. “While global growth is annually producing millions of new jobs, unemployment remains unacceptably high and may go to levels not seen before this year.”

He added that although more people are currently employed than ever before, more jobs does not necessarily mean decent jobs. “Too many people, if not unemployed, remain among the ranks of the working poor, the vulnerable or the discouraged.”

According to the ILO, an estimated 487 million workers – or 16.4 per cent of the total – still do not earn enough to surpass the $1 a day poverty line, and 1.3 billion workers (or 43.5 per cent) still live below $2 a day.

“What is apparent is that economic progress doesn’t automatically translate into new and decent jobs,” said Mr. Somavia, emphasizing that “labour market policies must be at the centre of macroeconomic policies to ensure that economic growth is inclusive and that development involves good, decent work.”

Decent work, as defined by the ILO, provides for opportunity and income; rights, voice and recognition; family stability; personal development; and fairness and gender equality.