Global employment growth is set to witness a 1 per cent slump this year compared to 2% in 2022, triggered by the economic fallout of the Ukraine war, high inflation and tighter monetary policy, the International Labour Organisation (ILO) said.
The organisation also predicted that global unemployment would rise slightly in 2023, by around 3 million, to 208 million (corresponding to a global unemployment rate of 5.8 per cent), the ILO said in a report on global trends.
"The slowdown in global employment growth means that we don't expect the losses incurred during the Covid-19 crisis to be recovered before 2025," said Richard Samans, Director of the ILO's Research Department and coordinator of its newly published report.
According to the organisation, the progress in reducing the number of informal jobs in the world is also likely to be reversed in the coming years.
"The current slowdown means that many workers will have to accept lower quality jobs, often at very low pay, sometimes with insufficient hours," ILO said. "Furthermore, as prices rise faster than nominal labour incomes, the cost-of-living crisis risks pushing more people into poverty."
Furthermore, as prices rise faster than nominal labour incomes, the cost-of-living crisis risks pushing more people into poverty. This trend comes on top of significant declines in income seen during the Covid-19 crisis, which in many countries affected low-income groups worst.
The report also identifies a new, comprehensive measure of the unmet need for employment – the global jobs gap. As well as those who are unemployed, this measure includes people, who want employment but are not actively searching for a job, either because they are discouraged or because they have other obligations such as care responsibilities.
The global jobs gap stood at 473 million in 2022, around 33 million above the level of 2019.
Roadblocks to labour market recovery
The emerging geopolitical tensions and the Ukraine conflict, uneven pandemic recovery, and continuing bottlenecks in global supply chains are some of the major obstacles to market recovery.
These factors have created the conditions for stagflation, a phenomenon characterized by high inflation and low growth, for the first time since the 1970s.
Not only is the overall job market suffering, but women and young people are disproportionately affected.
Globally, the labour force participation rate of women stood at 47.4% in 2022, compared to 72.3% for men. This 24.9 percentage point gap means that for every economically inactive man, there are two such women.
This disparity in labour force participation highlights the ongoing challenges faced by women in the job market and the need for targeted solutions to address this issue.