India specific points
• The report notes that the largest reductions in poverty continue to be recorded in eastern Asia, with poverty rates in China expected to fall to around 5 per cent in 2015. Poverty rates in India are expected to decline from 51 per cent in 1990 to 24 per cent in 2015, with the number of people living in extreme poverty expected to decrease by 188 million.
• Economic growth in the South Asia region as a whole declined from 9.1 per cent in 2007 to 5.9 per cent in 2008 and to 5.5 per cent in 2009. It is estimated that the region’s economy grew by 8.9 per cent in 2010, led by India, which registered rapid growth of 9.7 per cent in 2010.
• A larger share of women are engaged in vulnerable employment compared to men in South Asia, with gender-based gaps particularly large in India, Nepal and Pakistan. South Asia has the highest rate of vulnerable employment among all regions in the world, at 78.5 per cent of total employment in 2009. The rate has declined modestly in recent years, down from 81.1 per cent in 1999.
Unemployment remains elevated
• The number of unemployed globally stood at 205 million in 2010, essentially unchanged from the year earlier and 27.6 million higher than in 2007, with little hope for this figure to revert to precrisis levels in the near term. The global unemployment rate stood at 6.2 per cent in 2010, versus 6.3 per cent in 2009, but still well above the rate of 5.6 per cent in 2007.
• The ILO projects a global unemployment rate of 6.1 per cent, equivalent to 203.3 million unemployed, through 2011. 55 per cent of the increase in global unemployment between 2007 and 2010 occurred in the Developed Economies and European Union (EU) region, while the region only accounts for 15 per cent of the world’s labour force. In several economies in the developing world, such as Brazil, Kazakhstan, Sri Lanka, Thailand and Uruguay, unemployment rates have actually fallen below their pre-crisis levels.
• The elevated level of global unemployment stands in stark contrast to the recovery that has been seen in several key macroeconomic indicators: real global GDP, private consumption, gross fixed investment and world trade had all recovered by 2010, surpassing pre-crisis levels.
• There has been an uneven recovery in labour markets, with a continued rise in joblessness in the Developed Economies and European Union region, a steady to slightly improving unemployment picture in most developing regions.
• An estimated 1.53 billion workers were in vulnerable employment in 2009, corresponding to a vulnerable employment rate of 50.1 per cent. There were 630 million workers (20.7 per cent of all workers in the world) living with their families at the extreme US$ 1.25 a day level in 2009. This corresponds to an additional 40 million working poor, 1.6 percentage points higher than projected on the basis of pre-crisis trends.
A recovery in growth that has not brought about a comparable recovery in employment
• At the global level, the employment-to-population ratio, which indicates whether the employment-generating capacity of a country or region is rising or falling, declined from 61.7 in 2007 to 61.2 in 2009 and is estimated at 61.1 per cent in 2010. Many economies are simply not generating sufficient employment opportunities to absorb growth in the working-age population.
• In 64 countries for which quarterly data are available, as of the second quarter in 2010, the number of countries with falling employment-to-population ratios was still twice the number that had rising ratios. It is clear that the ongoing economic recovery is not yet leading to a sufficient expansion in employment opportunities in many countries.
Industrial employment hardest hit
• Total global employment in industry declined slightly in 2009, which is a major divergence from the historical annual growth rate of 3.4 per cent over the period from 2002 to 2007. Employment in agriculture grew in 2009, which also represented a divergence versus historical trends.
Growing number of discouraged youth
• The number of unemployed youth (aged 15–24) is estimated to have declined from 79.6 million in 2009 to 77.7 million in 2010, though this is still well above the 2007 level of 73.5 million. The global youth unemployment rate stood at 12.6 per cent in 2010, up from 11.8 per cent in 2007, but down slightly from 12.8 per cent in 2009.
• However, unemployment rates understate the severe extent to which the crisis impacted young people as labour force participation among youth was strongly affected by the crisis. Across 56 countries with available data, there are 1.7 million fewer youth in the labour market than expected based on longer term trends, indicating that discouragement among youth has risen sharply. These discouraged youth are not counted among the unemployed because they are not actively seeking work.
Trends in labour productivity and real wages reveal pressure on employment quality
• Labour productivity growth turned negative in 2009, declining by 1.4 per cent versus growth of 3.3 per cent in 2007. In 2010, global productivity growth recovered to 3.1 per cent.
• The problem of delayed labour market recovery is seen not only in the lag between output growth and employment growth and reduced unemployment but also in some countries in the lag between productivity growth and resumption in real wage growth. This phenomenon can threaten future recovery prospects, given the strong linkages between employment and growth in real wages on the one hand and consumption on the other.
Stagnating progress in reducing vulnerable employment and slowed progress in reducing working poverty
• On the basis of available data, the current estimate of the number of workers in vulnerable employment in 2009 is 1.53 billion, which corresponds to a global vulnerable employment rate of 50.1 per cent. The incidence of vulnerable employment remained roughly flat between 2008 and 2009, versus a steady and substantial average decline in the years preceding the crisis.
• The estimated working poverty rate at the extreme US$ 1.25 level for 2009 is 20.7 per cent, which is 1.6 percentage points higher than the rate projected on the basis of the pre-crisis trend. This amounts to around 40 million more working poor at the extreme US$ 1.25 level in 2009 than would have been expected on the basis of pre-crisis trends. The share of workers living with their families below the US$ 2 a day poverty line is estimated at around 39 per cent, or 1.2 billion workers worldwide.
An improved global economy, yet downside risks predominate in 2011
• Following a contraction in 2009, the global economy grew at a rapid pace of 4.8 per cent in 2010. The recovery is expected to continue in 2011, though at a more moderate pace (4.2 per cent). However, due to the fragile state of the labour market in many countries, high levels of public debt and continued vulnerabilities in the financial sector and private households, downside risks predominate.
• On the basis of current macroeconomic forecasts, the global unemployment rate is projected at 6.1 per cent in 2011, corresponding to global unemployment of 203.3 million. This represents little improvement over 2010 levels.