Despite continued rise in unemployment, measures taken by G20 governments will save up to 11 million jobs in 2009, ILO says

GENEVA (ILO News) – Employment and social protection measures taken by G20 governments since the economic crisis began will have created or saved an estimated 7 to 11 million jobs in the G20 countries this year, the Director-General of the International Labour Office (ILO) said in a communication (Note 1) to be presented to the G20 Summit to be held in Pittsburgh on 24-25 September.

The ILO also forecasts that continued labour market deterioration around the world in 2009 would produce an estimated increase in global unemployment of between 39 and 61 million workers relative to 2007,(Note 2) which could result in global unemployment ranging from 219 to 241 million – the highest level ever on record.

“Unemployment remains massive today as a result of the crisis. If the special measures taken are unwound or withdrawn too early, the jobs crisis may worsen even further. For people worldwide, and in particular for the most vulnerable and disadvantaged, the crisis will not be perceived as receding until they get a decent job and a minimum floor of social protection. A jobless recovery would not be socially or politically sustainable”, said ILO Director-General Juan Somavia, who is to attend the summit.

“The G20 Summit in Pittsburgh offers the opportunity to commit continued and enhanced support to employment and social protection measures until such time as private demand can sustain economic recovery as well as employment,” Mr. Somavia said, adding, “Strong economic growth and strong employment growth must go hand in hand. Policies should remain targeted on both objectives simultaneously in order to maximise the potential for growth in jobs in the period of economic recovery.”

The report states that the “Global Jobs Pact” (Note 3) approved in June 2009 by the tripartite membership of the ILO (governments, employers and workers from 183 countries) provides an internationally-agreed set of policy measures designed to reach these objectives.

The previous G20 summit in London in April 2009 called “upon the ILO, working with other relevant organisations, to assess the actions taken and those required for the future” to address the impact of the economic crisis on labour markets.

In the report “Protecting People, Promoting Jobs: A survey of country employment and social protection policy responses to the global economic crisis,” the ILO examined actions taken between mid-2008 and 30 July 2009 in 54 countries, spanning all income levels and regions and involving 32 specific measures grouped under four areas, namely stimulating labour demand; supporting jobs, job seekers, and unemployed; expanding social protection and food security; and applying social dialogue and protecting rights at work. (Note 4)

According to the report, the jobs saved or created as a result of the measures taken by G20 countries amount to between 29 and 43 per cent of the total increase in unemployment in the first half of 2009, meaning that without such measures unemployment would have been that much higher in these countries.

The ILO study found that the six most frequently taken measures included additional spending on infrastructure; subsidies and tax reductions for small enterprises; credit for small enterprises; training programmes and facilities; consultations with employers’ and workers’ organisations; and social protection through cash transfers. These measures correspond closely to the policy options outlined in the Global Jobs Pact.

The report also noted that not enough attention has been given to additional measures designed to fight labour trafficking and child labour, stimulate access by small enterprise to public tenders, promote consultations at the sectoral level, increase capacity for labour inspection and protect migrant workers.

While initial responses were aimed at staving off a precipitous decline in employment and mitigating the impact on the most vulnerable, the ILO report found that countries increasingly sought to prepare for recovery by investing in new infrastructure and in preparing the workforce for structural changes such as those resulting from adaptation to lower carbon emissions.

The ILO report notes that lower income countries would need additional support to strengthen their employment and social protection responses to the crisis.

Every year, some 45 million young women and men enter the global labour market, bringing additional pressures to labour markets already afflicted with high numbers of unemployed, persons discouraged from seeking work and those involuntarily working part time. Together these paint a very sizeable employment challenge, now and in the immediate future. Strong economic growth and high employment content of growth are both indispensable. Otherwise, even if recovery starts taking hold, a significant shortfall in available employment would remain for several years. This calls for decisive action.

“Stabilizing financial markets and raising the rate of output growth, crucial as these are, are not enough. Financial markets have to be put at the service of the real economy, ensure the flow of credit to enterprises, in particular small enterprises and fuel production and jobs.” said Mr Somavia.

“All countries, with the support of relevant international organizations, can engage in a convergent policy effort around employment and social protection, to ensure wide prosperity from robust economic growth and lay the foundations for a fair and sustainable globalization,” Mr. Somavia added. “This would require building much stronger links between investment, growth and productivity on the one hand, and employment, labour market and social and environmental policies on the other, the basis for a sustained and balanced future growth.”

For more information on the ILO report to be presented at the G20 please visit www.ilo.org/jobcrisis

Or contact the Department of Communication and Public Information of the ILO at communication@ilo.org – +4122/799-7912, or the ILO Office for the United Nations newyork@ilo.org – +1212/697-01-50.

Interviews can be scheduled with

Mr. Philippe Egger, Deputy Director of the Office of the ILO Director General +4179/593-15-26

Mr. Stephen Pursey, ILO Director of Statistics and Policy Integration and Senior Advisor to the ILO Director- General + 4179/593-13-71

Note 1 Protecting People, Promoting Jobs: From crisis response to recovery and sustainable growth Note 2 Key Indicators in the Labour Market, 6th edition, 2009 Note 3 “Recovering from the crisis: A Global Jobs pact”. Resolution adopted by the 98th session of the International Labour Conference, Geneva, June 2009. Note 4 This report was prepared over May-August 2009.