Thursday, February 14, 2008

Global unemployment rate to climb in 2008 - ILO

More people will be out of work in 2008 as a result of global economic cooling, and any major slowdown could cause disruption and further hike unemployment, the International Labour Organisation (ILO) said on Thursday.

In a report issued in the wake of heavy losses in world stock markets, and amid growing fears of worldwide recession, the United Nations agency said the world unemployment rate would climb to 6.1 percent this year from 6.0 percent in 2007.

Jose Manuel Salazar-Xirinachs, head of the ILO's employment sector, said the jitters that bled world markets this week had not yet trickled through to employment figures, which are considered a lagging indicator of world economic health.

But he said the 2008 projections may turn out to be overly bright if the world economy expands by less than the 4.8 percent estimated by the International Monetary Fund.

"This scenario ... would obviously be worse if global growth turns out to be less than predicted," Salazar-Xirinachs told a news briefing in Geneva, where the ILO is headquartered.

"It is very likely that there will be revisions of rates of growth downward," he said.

In its Global Employment Trends report, the ILO estimated that 3 billion people aged 15 and older had jobs in 2007, up nearly 2 percent from the year before and more than 17 percent higher than in 1997.

There were 190 million unemployed in 2007.

Among those employed, about 487 million people did not earn enough to lift themselves and their families above the $1-a-day poverty line, and 1.3 billion earned less than $2 a day.

"Despite working, more than 4 out of 10 workers are poor," the report concluded.

ILO economist Dorothea Schmidt said that productivity gains during the recent period of strong global economic growth meant there were fewer jobs created than necessary to create a cushion for any rocky period ahead.

"We have not created enough decent jobs," Schmidt told reporters. "The lack of productive jobs could mean a constraint for development during difficult times."

In addition to looming economic trouble, the ILO said rapid technological advances would present a major challenge for workers in the year ahead, particularly in rich markets such as the United States, Europe and Japan where jobs are increasingly being moved to poorer countries with cheaper labour costs.

"It is important for workers to be ready and able to adjust quickly to change and stiffer competition," the report said. "This can be fostered by not only giving them the right skills, but also giving them a feeling of security to handle the mental stress caused by changes."


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