ILO projects global jobless rate to rise by 2 million in 2024

Business a.m

The International Labour Organisation (ILO) has projected an extra two million workers are expected to be looking for jobs in 2024, indicating an increase in global unemployment rate from 5.1 per cent in 2023 to 5.2 per cent in 2024, despite an expected surge in the labour market.

The ILO’s latest forecast for 2024 paints a picture of a labour market that has been surprisingly resilient despite deteriorating economic conditions. However, it stated that the recovery from the pandemic is still uneven and has been hampered by new vulnerabilities and multiple crises.

Gilbert F. Houngbo,the  ILO director-general stated that the organisation’s latest forecast, the World Employment and Social Outlook Trends: 2024 (WESO Trends), shows that unemployment and the so-called “jobs gap rate” – which measures the number of people without jobs who are actively looking for work – have both fallen below pre-pandemic levels.

According to the ILO’s report, while the global unemployment rate has improved slightly, from 5.3 per cent in 2022 to 5.1 per cent in 2023, the underlying situation may not be as positive as it seems. The report highlights the fragile nature of the global labour market, and projects that unemployment and the overall labor market outlook will worsen in the coming years. 

Houngbo explained that disposable incomes have declined in most G20 countries, which are the world’s largest economies, and that inflation has eroded living standards. He noted that while the global economy is showing some signs of recovery, it is unlikely that these gains will be able to compensate for the losses that people have experienced.

“Furthermore, important differences persist between higher and lower income countries.
While the jobs gap rate in 2023 was 8.2 per cent in high-income countries, it stood at 20.5 per cent in the low-income group. Similarly, while the 2023 unemployment rate persisted at 4.5 per cent in high-income countries, it was 5.7 per cent in low-income countries,” he added. 

In addition to the negative impact on incomes and living standards, the ILO report also notes that the number of workers living in extreme poverty and moderate poverty is likely to persist or even increase in the coming years. 

Despite a brief decline in the number of workers living in extreme poverty (earning less than $2.15 per day per person in purchasing power parity terms) in 2020, the number of such workers increased by about 1 million in 2023. Similarly, the number of workers living in moderate poverty (earning less than $3.65 per day per person in PPP terms) is estimated to have increased by 8.4 in 2023.

According to Houngbo, the workforce challenges identified in the report pose a significant threat to individual livelihoods and the success of businesses. He said that it is essential to take action to address these challenges effectively and quickly, in order to prevent further inequality and social injustice. 

The ILO DG also stressed the importance of policies that support workers and businesses, and provide opportunities for people to improve their living standards.