ILO Headquarters

By Linda Eroke

G20 countries would need to create 21 million jobs in 2012 in order to return to pre-crisis employment levels, the International Labour Organisation (ILO) and the Organisation for Economic Cooperation and Development (OECD) has said.

In a joint report issued ahead of the G20 labour ministerial meeting in Guadalajara, Mexico, both international bodies maintained that it would be impossible to close the approximately 21 million jobs gap that has accumulated across the G20 countries if employment continues to grow at the current rate of 1.5 per cent.

The report noted that the significant slowdown in economic activity recorded in several major economies and regions over the second-half of 2011 weighed heavily on the labour markets of many G20 countries adding that some of the earlier improvements faded and the risks that high unemployment and under-employment could become entrenched increased.

“The G20 has the opportunity to tackle the roots of the persistent weaknesses of the global economy. It is now clear that the way forward is through the better integration of economic and social policies, with particular emphasis on productive investment, employment and decent work in order to generate new sources of demand.

“Listening to young women and men, and having policies enabling all youth to enter the labour market with adequate education, vocational training, initial work experience and orientation, is a critical measure of our societies’ ability to integrate the new generation” , ILO Director-General Juan Somavia said.

The report stated that in all G20 countries the youth unemployment rate is two to three times higher than for adults. However, it noted that there is significant variance among countries, from around 7 per cent in some to close to 50 per cent in others (and overall average of 19.2 per cent across the G20).

“This rate doesn’t include discouraged youth and those prolonging their studies in the face of an adverse labour market. The lingering crisis is increasing structural challenges in the form of high and mostly rising youth unemployment and a rising incidence of long term unemployment.

“The G20 Ministers of Labour and Employment are to give particular attention to youth employment; their conclusions will only strengthen the discussion on youth employment at the International Labour Conference in June,” the report stated.

With regard to overall unemployment, the study shows large differences among G20 countries. For example, five of 17 countries with available data have seen employment grow at 2 per cent or more over the past year, while six show employment growth of less than 0.6 per cent.

It added that over the past year, the unemployment rate has declined in the majority of G20 countries, often only moderately, but it has actually increased in most European countries. Brazil, Germany, Indonesia, the Russian Federation, Turkey and more recently the United States have experienced sizeable declines in unemployment.

The study also highlighted the high share of informal employment in emerging countries reaching an average of 45 per cent in the eight G20 countries with available data.

Across the 20 countries, major changes are taking place in the sectoral composition of employment, the study noted, adding that employment in public services has been one of the major sources of job creation since 2010.

In another joint study prepared for the G20 meeting, the ILO and OECD explain that the transition towards a low-carbon economy will necessarily reshape the labour market significantly with both losses and gains in employment.

But the study mentions a number of policies that can help a successful transition, including policies to promote the rapid expansion of renewable energy, incentives to improve the energy efficiency of buildings and environmental tax reforms which use the revenues from newly imposed environmental taxes to lower taxes on labour income. Such policies can play a powerful role in making environmental, employment and social policy mutually reinforcing.

The study also refers to social dialogue between governments, employers and workers as an essential tool to facilitate a just transition to a green economy that addresses at the same time poverty and promotes employment and social protection.