ILO: Economic hardship undermines labor market in low-income countries

Rising debt, exacerbated by high inflation and rising interest rates, is robbing job seekers in developing countries of hope. This is stated in the report of the International Labor Organization (ILO), published on Wednesday.

The authors of the study note that while in high-income countries only 8.2 percent of people who want to work are unemployed, in low-income countries such people make up more than 21 percent of the population.

The situation is most difficult in low-income countries that are in a debt crisis. Every fourth person who wants to find a job cannot find a job there.

Widening employment gap
ILO Deputy Director-General for Employment and Social Protection Mia Seppo said global unemployment is expected to fall below pre-pandemic levels. It is estimated to be 5.3 percent in 2023, equivalent to 191 million people.

Seppo said the global job gap will widen to 453 million in 2023, with 1.5 times as many women looking but not finding work as men.

The situation in Africa
Africa's labor market has been hardest hit during the pandemic, according to an ILO report, explaining the continent's slow pace of recovery.

Unlike rich countries, a continent-wide debt crisis and very limited fiscal and policy space mean few countries in Africa can put in place the comprehensive stimulus packages needed to boost economic recovery, ILO experts say.

Social investment
The annual cost of such measures, according to Seppo, will be about 1.6 percent of GDP - "serious, but not impossible" investments. She suggested that this amount could be financed through social contributions, taxes and international support. “Investing in social protection brings economic benefits,” she added.

Seppo also insists that the need for social investment in low-income countries should be addressed "as a matter of urgency as part of the ongoing global debate on reforming the international financial architecture."

The future of work
While the unemployment gap is worrisome, it “is not inevitable,” Seppo said. Concerted action to create employment and finance social protection can help recovery and reconstruction.

At the same time, special attention should be paid to upskilling and reskilling the workforce in order to prepare it for a “greener and more digital world of work”.

Source: avesta.tj