UN warns of grow­ing in­equal­ity and job­less­ness

The Pak Banker - - 6BUSINESS -

Un­em­ploy­ment will rise by 11 mil­lion in the next five years due to slower growth and tur­bu­lence, the UN warned on Tues­day.

More than 212 mil­lion peo­ple will be job­less by 2019 against the cur­rent level of 201 mil­lion, the In­ter­na­tional Labour Or­ga­ni­za­tion said. "The global econ­omy is con­tin­u­ing to grow at tepid rates and that has clear con­se­quences," ILO head Guy Ry­der told re­porters in Geneva.

"The global jobs gap due to the cri­sis stands at 61 mil­lion jobs world- wide," he said, re­fer­ring to the num­ber of jobs lost since the start of the fi­nan­cial cri­sis in 2008.

The ILO World Em­ploy­ment and So­cial Out­look -- Trends 2015 re­port said an ex­tra 280 mil­lion jobs would have to be cre­ated by 2019 to close the gap cre­ated by the fi­nan­cial tur­moil.

"This means the jobs cri­sis is far from over and there is no place for com­pla­cency," Ry­der said. The job sce­nario im­proved in the United States, Ja­pan and Bri­tain but re­mains wor­ri­some in sev­eral de­vel­oped economies of Europe, the re­port said.

"The aus­ter­ity tra­jec­tory...

in Europe in par­tic­u­lar has con­trib­uted dra­mat­i­cally to in­creases in un­em­ploy­ment," Ry­der said. The re­port said eu­ro­zone pow­er­house Ger­many could see un­em­ploy­ment rise to five per­cent in 2017 against 4.7 per­cent at present, while it was ex­pected to fall just un­der the dou­ble-digit in num­ber two eu­ro­zone econ­omy France.

The worst-hit seg­ment glob­ally were those aged be­tween 15 and 24, with the youth un­em­ploy­ment rate touch­ing 13 per­cent in 2014, almost three times the rate for adults.

Mas­sive suf­fer­ing, mis­ery The UN agency said the steep fall in oil and gas prices would hit the labour mar­ket hard in pro­duc­ing coun­tries in Latin Amer­ica, Africa and the Arab world.

But one of the rare bits of good news was that the mid­dle class com­prised more than 34 per­cent of to­tal em­ploy­ment in de­vel­op­ing coun­tries from 20 per­cent in the 1990s, Ry­der said. How­ever ex­treme poverty con­tin­ues to af­fect one out of 10 work­ers glob­ally who earn less than $1.50 a day, he added.

A widen­ing chasm be­tween the haves and have nots and an un­cer­tain in­vest­ment cli­mate have made it dif­fi­cult for coun­tries to re­bound from the cri­sis, the re­port said. Cut­ting wages has been a key el­e­ment in the in­ter­na­tional bailouts of eu­ro­zone mem­bers.

But there are con­cerns that ex­cep­tion­ally low price rises in the 18 coun­tries shar­ing the euro could au­gur a long pe­riod of slow growth and fall­ing pros­per­ity.

"If low wages lead peo­ple to con­sume less, and in­vest­ment re­mains sub­dued, this ob­vi­ously has a neg­a­tive im­pact on growth," Ry­der said. "In­come in­equal­ity in some ad­vanced economies now ap­proach lev­els ob­served among emerg­ing economies," he said.

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