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27/09/2011 | Global economy - 'Massive jobs shortfall' predicted for global economy

Reuters Staff

International Labour Organisation said the group of developing and developed nations had seen 20m jobs disappear since the financial crisis in 2008.

 

The world's major economies are heading for a "massive jobs shortfall" by the end of next year if governments do not change their tack on policy, the International Labour Organisation (ILO) said in a study published on Monday.

In the report, prepared with the OECD for G20 labour ministers meeting in Paris on Monday, the ILO said the group of developing and developed nations had seen 20m jobs disappear since the financial crisis in 2008.

At current rates it would be impossible to recover them in the near term and there was a risk of the number doubling by the end of next year, it said.

"We must act now to reverse the slowdown in employment growth and make up for the jobs lost," ILO director general Juan Somavia said in a statement.

"Employment creation has to become a top macroeconomic priority."

The number of people in work in the G20 has risen by 1% since 2010, but 1.3% annual growth is needed to return to pre-crisis employment levels by 2015, the ILO said.

"However, employment growth of less than 1% cannot be excluded given the slowdown of the world economy and the anaemic growth foreseen in several G20 countries," the report said. "Should employment grow at a rate of 0.8% until end 2012, now a distinct possibility, then the shortfall in employment would increase by some 20m to a total of 40m in G20 countries."

India and China, the world's most populous countries, were both laggards with less than 1% annual growth in total employment, the report said, so an extra push for jobs could have a major impact on the G20.

However, the report was based on figures for both countries that were not up to date. China's jobs growth of 0.7% was for 2009, while India's 0.4% was the average annual change between 2004-2005 and 2009-2010.

After stripping out India, China and Saudi Arabia, which also used 2009 data, employment growth in the other 17 countries was 1.5%, according to a Reuters calculation based on data in the ILO report.

The latest figures for other G20 countries show four with growth rates below 1%, namely Italy, France, South Africa and the United States, while two others – Japan and Spain – have seen a fall in total employment in the past year.

Since the beginning of 2008, Spain, South Africa and the United States had experienced the biggest falls in employment among the G20 countries. Spain and the United States also saw the biggest rises in unemployment rates, followed by Britain.

The Guardian (Reino Unido)

 


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