By Larry Elliot
The Guardian
January 25, 2011
ILO data provides an alarming picture of joblessness, especially among the young, that surely threatens more political instability
A jobless recovery. Entrenched levels of high unemployment among the young. More than 1.5 billion people - half the global working population - in vulnerable or insecure jobs.
Those are the key findings of the latest health check on employment trends across the world released by the International Labour Organisation last night.
The ILO report makes depressing reading. Despite a relatively robust pick-up in growth during 2010, economic recovery made virtually no dent in the unemployment caused by the worst recession in the global economy since world war two. The official jobless figure stood at 205 million in 2010, but that is almost certainly an underestimate since many of those who would like a job have given up hope of finding one, while millions more are working part-time when they would prefer full-time employment.
At 6.2%, the global unemployment rate doesn't sound that alarming, but the overall figure conceals some worrying trends. Although the developed economies of the west account for only 15% of the earth's working population, they accounted for 55% of the increase in unemployment between 2007 and 2010. Sir Richard Lambert, the outgoing director-general of the CBI, made a timely intervention on Sunday when he urged the UK government to come up with a more comprehensive strategy for jobs.
Equally unsettling is the outlook for youth unemployment, which the ILO categorises as the number of people aged between 15 and 24 who are actively seeking working but unable to find it. There was a slight reduction in youth unemployment last year from 79.6 million to 77.7 million but the jobless rate for the young still stands at 12.6%.
In some countries, the outlook is even worse. Spain has youth unemployment of 40%, while young people in south-east Asia and the Pacific are 4.7 times more likely to be unemployed as adults. One of the root causes of the revolution in Tunisia was the unrest caused by having a growing number of young people without jobs: the ILO estimates that in north Africa as a whole "an alarming" 23.6% of economically active young people were unemployed in 2010.
Some countries recognise the threat to political stability created by this enforced worklessness. China's ruling elite fears the impact of large-scale joblessness among the young workers attracted into the cities by rapid industrialisation, and has pursued an aggressively expansionary economic policy to ensure that the labour market remains buoyant. In the US, the Federal Reserve has been acting less like a central bank and more like a continent-wide labour exchange, pumping billions of dollars into the US economy through the money creation process known as quantitative easing.
Other countries have yet to face up to the scale of the challenge represented by the ILO's data. Even in normal times, high levels of unemployment - especially among the young - are a headache for policymakers. But these are not normal times. Large amounts of taxpayers' cash has been used to bail out the banks, and those self-same taxpayers are now facing spending cuts and tax increases to repair the damage caused to national budgets by the financial crisis. Low interest rates and quantitative easing have led to a fresh wave of speculation in global commodity markets, pushing up the cost of oil and food. In short, a small global elite has emerged from the crisis smelling of roses, while the bulk of the world's population is struggling with poor job prospects, the rising cost of essential goods and, in some countries, repressive government. It is a tinderbox.
Read the full report here
