Connect with us

Reports

Unemployment to remain high, quality jobs harder to find in 2018

Published

on

Photo by Alex Kotliarskyi on Unsplash

While the global economy has kept up modest growth, the total number of unemployed people will likely remain high in 2018 – at above 192 million – and it will be harder to find a decent job, the United Nations labour agency reported on Monday.

“Even though global unemployment has stabilized, decent work deficits remain widespread: the global economy is still not creating enough jobs. Additional efforts need to be put in place to improve the quality of work for jobholders and to ensure that the gains of growth are shared equitably,” ILO Director-General Guy Ryder said.

The World Employment and Social Outlook: Trends 2018, a flagship report by the International Labour Organization (ILO), examines employment and social trends for the world as a whole and for each region, and analyses structural transformation and implications for future job quality.

The report says the global economy grew 3.6 per cent in 2017, after hitting a six-year low of 3.2 per cent in 2016. The recovery was broad based, driven by expansions in developing, emerging and developed countries alike. Future growth is likely to stay below four per cent, as economic activity normalizes in most major economies without significant stimulus and fixed investment remains at a moderate level.

The projected fall in the 2018 global unemployment rate would also mark a turnaround after three years of rises, and would remain essentially unchanged in 2019, according to the report. However, with a growing number of people entering the labour market to seek employment, the total number of unemployed is expected to remain above 192 million in 2018, and that number would likely grow by 1.3 million in 2019.

Vulnerable employment is on the rise

The report also notes that the number of workers in vulnerable forms of employment, such as own-account workers and contributing family workers, is likely to increase in the years to come. Globally, the significant achievements had been made in reducing vulnerable employment but progress has essentially stalled since 2012.

In 2017, about 42 per cent of workers, or 1.4 billion, worldwide were estimated to be in vulnerable forms of employment. This share was expected to remain particularly high in developing and emerging countries, at above 76 per cent and 46 per cent, respectively. Worryingly, the number of people in vulnerable employment is projected to increase by 17 million in each of 2018 and 2019.

Slow pace of reducing ‘working poverty’

Similarly, the global labour market has seen only weak progress in addressing the problem of ‘working poverty,’ or living under poverty lines despite employment, the report says. In 2017, extreme working poverty remained widespread, with more than 300 million workers in emerging and developing countries having a per capita household income or consumption of less than $1.90 per day.

“In developing countries though, progress in reducing working poverty is too slow to keep up with the expanding labour force. The number of workers living in extreme poverty is expected to remain stubbornly above 114 million for the coming years, affecting 40 per cent of all employed people in 2018,” explains ILO economist Stefan Kühn, lead author of the report.

Emerging countries, on the other hand, achieved significant progress in reducing extreme working poverty, which is expected to affect less than 8 per cent, or around 190 million, of workers there in 2017.

The incidence of extreme poverty should continue to fall, translating into a reduction in the number of extreme working poor by 10 million per year in 2018 and 2019. Nevertheless, moderate working poverty, in which workers live on an income of between $1.90 and $3.10 per day, remains widespread, affecting 430 million workers in emerging and developing countries in 2017.

The report also looks at the influence of population ageing. It shows that the growth of the global workforce will not be sufficient to compensate for the rapidly expanding pool of retirees. The average age of working people is projected to rise from just under 40 in 2017 to over 41 in 2030.

“Besides the challenge of a growing number of retirees creates for pension systems, an increasingly ageing workforce is also likely to have a direct impact on labour markets. Ageing could lower productivity and slow down labour market adjustments following economic shocks,” says the ILO’s Director of Research Department a. i., Sangheon Lee.

Continue Reading
Comments

Reports

‘Industry 4.0’ tech for post-COVID world, is driving inequality

Published

on

Developing countries must embrace ground-breaking technologies that have been a critical tool in tackling the COVID-19 pandemic, or else face even greater inequalities than before, UN economic development  experts at UNCTAD said on Thursday.

“Very few countries create the technologies that drive this revolution – most of them are created in China and the US – but all countries will be affected by it”, said UNCTAD’s Shamika Sirimanne, head of Division on Technology and Logistics. “Almost none of the developing countries we studied is prepared for the consequences.”

The appeal, which is highlighted in a new UNCTAD report, relates to all things digital and connective, so-called “Industry 4.0” or “frontier technologies”, that include artificial intelligence, big data, blockchain, 5G, 3D printing, robotics, drones, nanotechnology and solar energy.

Gene editing, another fast-evolving sector, has demonstrated its worth in the last year, with the accelerated development of new coronavirus vaccines.

Drone aid

In developing countries, digital tools can be used to monitor ground water contamination, deliver medical supplies to remote communities via drones, or track diseases using big data, said UNCTAD’s Sirimanne.

But “most of these examples remain at pilot level, without ever being scaled-up to reach those most in need: the poor. To be successful, technology deployment must fulfil the five As: availability, affordability, awareness, accessibility, and the ability for effective use.”

Income gap widening

With an estimated market value of $350 billion today, the array of emerging digital solutions for life after COVID is likely to be worth over $3 trillion by 2025 – hence the need for developing countries to invest in training and infrastructure to be part of it, Sirimanne maintained.

“Most Industry 4.0 technologies that are being deployed in developed countries save labour in routine tasks affecting mid-level skill jobs. They reward digital skills and capital”, she said, pointing to the significant increase in the market value of the world’s leading digital platforms during the pandemic.

Innovation dividends

“The largest gains have been made by Amazon, Apple and Tencent,” Sirimanne continued. “This is not surprising given that a very small number of very large firms provided most of the digital solutions that we have used to cope with various lockdowns and travel restrictions.”

Expressing optimism about the potential for developing countries to be carried along with the new wave of digitalisation rather than be swamped by it, the UNCTAD economist downplayed concerns that increasing workforce automation risked putting people in poorer countries out of a job.

This is because “not all tasks in a job are automated, and, most importantly, that new products, tasks, professions, and economic activities are created throughout the economy”, Sirimanne said.

‘Job polarization’

“The low wages …for skills in developing countries plus the demographic trends will not create economic incentives to replace labour in manufacturing – not yet.”

According to UNCTAD, over the past two decades, the expansion in high and low-wage jobs – a phenomenon known as “job polarization” – has led to only a single-digit reduction in medium-skilled jobs in developed and developing countries (of four and six per cent respectively).

“So, it is expected that low and lower-middle income developing countries will be less exposed to potential negative effects of AI and robots on job polarization”, Sirimanne explained.

Nonetheless, the UN trade and development body cautioned that there appeared to be little sign of galloping inequality slowing down in the new digital age, pointing to data indicating that the income gap between developed and developing countries is $40,749 in real terms today, up from $17,000 in 1970.

Continue Reading

Reports

Greater Innovation Critical to Driving Sustained Economic Recovery in East Asia

Published

on

Innovation is critical to productivity growth and economic progress in developing East Asia in a rapidly changing world, according to a new World Bank report launched today.

Countries in developing East Asia have an impressive record of sustained growth and poverty reduction.  But slowing productivity growth, uncertainties in global trade, and technological advances are increasing the need to transition to new and better modes of production to sustain economic performance.

To support policy makers in meeting this challenge, The Innovation Imperative for Developing East Asia examines the state of innovation in the region, analyzes the key constraints firms face in innovating, and lays out an agenda for action to spur innovation-led growth.

A large body of evidence links innovation to higher productivity,” said Victoria Kwakwa, World Bank Vice President for East Asia and Pacific. “The COVID-19 pandemic, climate change, along with the fast-evolving global environment, have raised urgency for governments in the region to promote greater innovation through better policies.

While developing East Asia is home to several high-profile innovators, data presented in the report show that most countries in the region (except China) innovate less than would be expected given their per capita income levels. Most firms operate far from the technological frontier. And the region is falling behind the advanced economies in the breadth and intensity of new technology use.

“Aside from some noteworthy examples, the vast majority of firms in developing East Asia are currently not innovating,” said Xavier Cirera, a lead author of the report. “A broad-based model of innovation is thus needed – that supports a large mass of firms in adopting new technologies, while also enabling more-sophisticated firms to undertake projects at the cutting edge.”

The report identifies several factors that impede innovation in the region, including inadequate information on new technologies, uncertainty about returns to innovation projects, weak firm capabilities, insufficient staff skills, and limited financing options. Moreover, countries’ innovation policies and institutions are often not aligned with firms’ capabilities and needs.

To spur innovation, the report argues that countries need to reorient policy to promote diffusion of existing technologies, not just invention; support innovation in the services sectors, not just manufacturing; and strengthen firms’ innovation capabilities. Taking this broader view of innovation policy will be critical to enabling productivity gains among a broader swath of firms in the region.

“It is important for governments in the region to support innovation in services, given their rising importance in these economies – not only for better service quality but increasingly as key inputs for manufacturing,” said Andrew Mason, also a lead author of the report.

Countries also need to strengthen key complementary factors for innovation, including workers’ skills and instruments to finance innovation projects. Building stronger links between national research institutions and firms will also be critical to fostering innovation-led growth in the region.

Continue Reading

Reports

Sea transport is primary route for counterfeiters

Published

on

More than half of the total value of counterfeit goods seized around the world are shipped by sea, according to a new OECD-EUIPO report.

Misuse of Containerized Maritime Shipping In the Global Trade of Counterfeits says that seaborne transport accounts for more than 80% of the volume of merchandise traded between countries, and more than 70% of the total value of trade.

Containerships carried 56% of the total value of seized counterfeits in 2016. The People’s Republic of China was the largest provenance economy for container shipments, making up 79% of the total value of maritime containers containing fakes and seized worldwide. India, Malaysia, Mexico, Singapore, Thailand, Turkey and the United Arab Emirates are also among the top provenance economies for counterfeit and pirated goods traded worldwide.

Between 2014 and 2016, 82% of the seized value of counterfeit perfumes and cosmetics by customs authorities worldwide, 81% of the value of fake footwear and 73% of the value of customs seizures of fake foodstuff and toys and games concerned sea shipments. Additional analysis showed that over half of containers transported in 2016 by ships from economies known to be major sources of counterfeits entered the European Union through Germany, the Netherlands and the United Kingdom. There are also some EU countries, such as Bulgaria, Croatia, Greece and Romania, with relatively low volumes of containers trade in general, but with a high level of imports from counterfeiting-intense economies.

To combat illicit trade, a number of risk-assessment and targeting methods have been adapted for containerised shipping, in particular to enforce against illicit trade in narcotics and hazardous and prohibited goods. But the analysis reveals that the illicit trade in counterfeits has not been a high priority for enforcement, as shipments of counterfeits are commonly perceived as “commercial trade infractions” rather than criminal activity. Consequently, existing enforcement efforts may not be adequately tailored to respond to this risk, according to the report.  Tailored and flexible governance solutions are required to strengthen risk-assessment and targeting methods against counterfeits.

As well as infringing trademarks and copyright, counterfeit and pirated goods entail health and safety risks, product malfunctions and loss of income for companies and governments. Earlier OECD-EUIPO work has shown that imports of counterfeit and pirated goods amounted to up to USD 509 billion in 2016, or around 3.3% of global trade.

Continue Reading

Publications

Latest

Economy1 hour ago

Kickstarting the U.S. Economy: A Rebound or Further Inequity?

The global economy has seen its fair share of peculiarity in recent years; much attributed to the developing economies rather...

Health & Wellness3 hours ago

Over 500,000 people have been inoculated against COVID-19 in Moscow

The number of people who wish to receive a COVID-19 vaccination in Moscow has reached half a million, and over...

Middle East7 hours ago

Gender in the GCC — The Reform Agenda Continues

In my previous Op-Ed about the road map for reforms in the Gulf Cooperation Council (GCC), I talked about the...

Human Rights11 hours ago

Belarus human rights situation deteriorating further

A “systematic crackdown” against dissent in Belarus is continuing, months since the country’s disputed presidential election last year, UN rights...

Health & Wellness13 hours ago

Natalia Vodianova joins UNFPA to tackle stigma and advance women’s health

The UN’s sexual and reproductive health agency, UNFPA, on Wednesday appointed supermodel, philanthropist, and impact investor Natalia Vodianova as its...

Defense15 hours ago

SCO: Potential and Challenges to Regional Integration

The modern system of the world is facing the state of imbalance as it passes through the phase of change...

Environment18 hours ago

Georgia’s Blue Economy Can Be a Vehicle for Accelerating Climate Change Adaptation

Greening the Coast and Blueing the Sea for a Resilient Georgia – a virtual event on climate change and marine...

Trending