The International Labour Organization (ILO) has issued a realistic recent assessment of the global job market, warning of an imminent rise in global unemployment for the year 2024. Although the initial recovery post-COVID-19 pandemic showed some resilience, the ILO’s report on global employment and social outlook for the new year reveals an underlying fragility, with increasing social disparities and a productivity stagnation that raise significant concerns.
The report, released in Geneva, highlights the nuanced challenges that threaten to undermine the prospects of achieving more social justice, raising questions about the course of the global workforce.
Resilience Amid Challenges
The report, which Al Jazeera Net reviewed a copy of, sheds light on the relative resilience that labor markets have shown despite deteriorating economic conditions. Both the unemployment rate and the job gap rate decreased to below pre-pandemic levels, reaching 5.1% in 2023, a slight improvement from 5.3% in 2022. However, the report cautions that these positive numbers conceal a fragility that could exacerbate the labor market outlook and increase global unemployment rates in 2024.
More Inequality
For 2024, the report forecasts that an additional 2 million workers will be seeking jobs, raising the global unemployment rate from 5.1% in 2023 to 5.2% in the new year. These predictions are driven by a decline in disposable income in the majority of G20 countries, and it’s unlikely that the erosion of living standards due to inflation will be quickly compensated.
Notably, the report mentions that large disparities remain between high-income countries and low-income countries, with job gaps and unemployment rates increasing in the latter according to the report.
The report indicates that disparities in labor market participation rates continue to exist in many sectors (AFP).
Despite a decline in the number of working poor after 2020, the report shows that the number of workers living in extreme poverty increased by about one million in 2023. The widening income gap raises concerns about its impact on overall demand and sustainable economic recovery.
The ILO expects informal labor rates to remain stable, representing about 58% of the global workforce in 2024.
Labor Market Imbalances
While labor market participation rates have returned to pre-pandemic levels for some sectors, the report points out that disparities still exist in many areas.
Regarding women’s participation in the workforce, the report documents a rapid recovery in women’s participation after the pandemic setback. However, the report notes the significant gender gap that still exists, especially in emerging and developing countries. Unemployment rates among youth and marginalized groups pose challenges to long-term employment opportunities, particularly for young women.
The report also reveals that those reentering the workforce after the pandemic are working fewer hours than before, and there has been a significant increase in sick leave.
Productivity Stagnation
Despite a short recovery following the pandemic, labor productivity has returned to the low levels of the last decade. The report identifies obstacles to productivity growth, including investment directed towards less productive sectors, a lack of skills, and the dominance of large digital monopolies hindering technology adoption.
Gilbert Houngbo, the ILO’s Director-General, has expressed deep concern about the findings of the report, pointing out that the imbalances identified in the report may not be temporary recovery issues but rather structural challenges.
Houngbo suggests that the anticipated long-term effects pose threats to the livelihoods of individuals and companies. He adds that declining living standards, weak productivity, and ongoing inflation create conditions conducive to further inequalities among people, undermining efforts aimed at achieving social justice.
