World Employment and Social Outlook Trends 2023 - ILO

ILO Flagship Report
X World
Employment
and Social Outlook
Trends
2023
X World
Employment
and Social Outlook
Trends 2023
International Labour Office • Geneva

Copyright © International Labour Organization 2023
First published 2023
This is an open access work distributed under the Creative Commons Attribution 4.0 International License
(https://creativecommons.org/licenses/by/4.0/). Users can reuse, share, adapt and build upon the original
work, as detailed in the License. The ILO must be clearly credited as the owner of the original work. The
use of the emblem of the ILO is not permitted in connection with users’ work.
Attribution – The work must be cited as follows: World Employment and Social Outlook: Trends 2023.
Geneva: International Labour Office, 2023.
Translations – In case of a translation of this work, the following disclaimer must be added along with
the attribution: This translation was not created by the International Labour Office (ILO) and should not be
considered an official ILO translation. The ILO is not responsible for the content or accuracy of this translation.
Adaptations – In case of an adaptation of this work, the following disclaimer must be added along with
the attribution: This is an adaptation of an original work by the International Labour Office (ILO). Responsibility
for the views and opinions expressed in the adaptation rests solely with the author or authors of the adaptation
and are not endorsed by the ILO.
This CC license does not apply to non-ILO copyright materials included in this publication. If the ma-
terial is attributed to a third party, the user of such material is solely responsible for clearing the rights
with the right holder.
Any dispute arising under this license that cannot be settled amicably shall be referred to arbitration
in accordance with the Arbitration Rules of the United Nations Commission on International Trade
Law (UNCITRAL). The parties shall be bound by any arbitration award rendered as a result of such
arbitration as the final adjudication of such a dispute.
All queries on rights and licensing should be addressed to ILO Publishing (Rights and Licensing),
CH-1211 Geneva 22, Switzerland, or by email to rights@ilo.org.
ISBN 9789220372913 (print); ISBN 9789220372920 (web PDF)

ISSN 2709-7080 (print); 2709-7099 (online)
DOI: https://doi.org/10.54394/SNCP1637
labour market / unemployment / employment creation / inflation / COVID-19 / report
13.01.2
ILO Cataloguing in Publication Data
DOI: https://doi.org/10.54394/SNCP1637
Also available in French: Emploi et questions sociales dans le monde: Tendances 2023, ISBN 9789220372937
(print), 9789220372944 (web PDF); and in Spanish: Perspectivas Sociales y del Empleo en el Mundo: Tendencias
2023, ISBN 9789220372951 (print), 9789220372968 (web PDF).
The designations employed in ILO publications, which are in conformity with United Nations practice, and
the presentation of material therein do not imply the expression of any opinion whatsoever on the part
of the ILO concerning the legal status of any country, area or territory or of its authorities, or concerning
the delimitation of its frontiers.
The responsibility for opinions expressed in signed articles, studies and other contributions rests solely
with their authors, and publication does not constitute an endorsement by the ILO of the opinions
expressed in them.
Reference to names of firms and commercial products and processes does not imply their endorsement
by the ILO, and any failure to mention a particular firm, commercial product or process is not a sign of
disapproval.
Information on ILO publications and digital products can be found at: www.ilo.org/publns.
Photo credits
Front cover: © Kritanut Unsombut/iStock
Produced by the Publications Production Unit (PRODOC) of the ILO.

The ILO endeavours to use paper sourced from forests managed
in an environmentally sustainable and socially responsible manner.
Code: DESIGN/WEI/PMSERV
3
Preface
This year’s World Employment and Social Outlook: Trends provides

a comprehensive assessment of current decent work deficits and
how these have been exacerbated by multiple, overlapping crises
in recent years. It analyses global patterns, regional differences and
outcomes across groups of workers. The report provides labour
market projections for 2023 and 2024 and presents trends in labour
productivity growth, analysing the factors contributing to its decline.
By the end of 2022, the recovery from the COVID-19 crisis was still
incomplete and highly uneven across the world, particularly in low-
income and middle-income countries, and was further hampered
by the consequences of the conflict in Ukraine, accelerating climate
change and unprecedented humanitarian challenges. Projections of
a slowdown in economic and employment growth in 2023 imply that
most countries will fall short of a full recovery to pre-pandemic levels
in the foreseeable future. Worse still, progress in labour markets is
likely to be far too slow to reduce the enormous decent work deficits
that existed prior to, and were exacerbated by, the pandemic. Lack
of access to employment, poor job quality, insufficient pay and major
inequalities are only some of the challenges that undermine social
justice. The globally observed slowdown in productivity growth
is likely to make those challenges even more difficult to address.
In times of crisis, international solidarity is more critical than ever.
A new global social contract is needed to narrow the existing deficits
in decent work and social justice. To this end, in 2023 the ILO will
launch a Global Coalition for Social Justice aimed at strengthening
global solidarity and improving policy coherence, in order to bring
about action and investment for decent work and social justice.
More than ever, the convergence of crises and the associated uncer-
tainties are fuelling the sources of inequalities and undermining the
already endangered social contract. Beyond the individual human
tragedies they have caused, and their impact on the world of work,
these crises have highlighted the interlinkages and dependencies
of economies and societies around the world and have shown the
crucial need for concerted, coordinated action at all levels. We need
both awareness of the necessity to act and new ways of translating
this awareness into resolute action without further delay.
Gilbert F. Houngbo
ILO Director-General
Contents 5
Contents
Preface3
Acknowledgements9
Executive summary 11
1. Stalled labour market recovery undermines social justice 19

Overview19
A challenging macroeconomic environment for labour markets 23

The cost-of-living crisis is eroding disposable incomes 23
Options for fiscal and monetary policy are limited 24
Short-term economic outlook 25
Long-term trends affecting labour market dynamics 27
Labour supply, employment and shortage of jobs 28

Labour supply 28
Quantity of work: Employment and working hours 31
Unemployment 37
The jobs gap, beyond unemployment 39
Workers are likely to face deteriorating working conditions 41

Work incomes and inequality 41
The changing composition of employment growth 43
Risks to the outlook 47
Renewing the social contract and advancing social justice 49
References50
2. Employment and social trends by region 57

Overview57
Africa59
Labour market trends in North Africa 60
Labour market trends in sub-Saharan Africa 60
Job creation potential from climate change adaptation 62
Americas64
Labour market trends in Latin America and the Caribbean 64
Quality of employment remains a concern in Latin America and the Caribbean 66
Labour market trends in North America 67
Labour and skill shortages are widespread in North America 68
6 X World Employment and Social Outlook | Trends 2023
Arab States 69
Labour market trends in the Arab States 70
Jobs in the just transition to a green economy in the Arab States 70
Asia and the Pacific 72

Labour market trends in Asia and the Pacific 73
Ongoing shortages of migrant workers in Association
of Southeast Asian Nations (ASEAN) countries of destination 75
Europe and Central Asia 77

Labour market trends in Europe and Central Asia 78
Labour force growth is a significant challenge in the region 80
References82
3. Global productivity trends:

Reviving growth through the digital economy? 87
Macroeconomic challenges in a global environment of low productivity growth 87
Productivity trends across the globe and structural shifts 90
Technology and labour market linkages 100
What else explains the productivity slowdown? 107
Policy options 109

Creating an environment for sustainable productivity growth 109
Productivity ecosystems for decent work and just transition 111
Institutional arrangements to promote productivity and decent work 112
References114
Appendices127
A. Groupings of countries and economies by region and income level 128
B. ILO modelled estimates 130
C. Tables of labour market indicators, world, by country income group

and by region or subregion 138
D. Estimates of jobs in global supply chains 176
E. Productivity measurement and data 179
F. Productivity growth and structural change 183

Contents 7
List of boxes
1.1. Food price explosion causes rise in food insecurity42
1.2. Accounting for GSC-related jobs45
3.1. Productivity: Measurement and key concepts91
3.2. The impact of the COVID-19 pandemic99
3.3. Productivity growth and automation101
List of figures
1.1. Overview of deficits in decent work and social justice, 2022 or latest year available21
1.2. Food and energy prices indices23
1.3. Median consumer and business confidence indicators (standard deviation from mean)
and policy uncertainty, February 2004 to September 202226
1.4. Growth of GDP per capita, 2010–23, world and country income groups (percentages)27
1.5. Old-age dependency ratio and labour force participation rate (percentages) of people
aged 25–64, 1991–2021, world and by country income group29
1.6. Labour force participation rate, 2022, by sex, world and by subregion (percentages)30
1.7. Youth aged 15–24 not in employment, education, or training, 2022, by sex, world
and by subregion (percentages)31
1.8. Job vacancies (standard deviations from mean), June 2001 to September 202232
1.9. Average annual employment growth, 2010–24, world and by country income group (percentages)33
1.10. Revision to employment growth projection in 2023, world, country income groups
and regions (percentage points)34
1.11. Weekly hours worked per employed person, 2010–24, world and by country income group36
1.12. Weekly hours worked per employed person, 2022, by sex, world and by subregion36
1.13. Youth unemployment rates, 2019 and 2022, world and country income groups (percentages)39
1.14. Unemployment rate and jobs gap, 2022, by gender and country income group (percentages)40
1.15. Index of informal employment incidence, 2004–22, by sex (2004 = 100)44
1.16. Weighted incidence of employment characteristic in middle-income countries, activities
relating to GSCs linked to high-income countries, and all activities, 2019 (percentages)46
1.17. Share of type of workers by economic activities, 2021, by country income group (percentages)47
1.18. Evolution of economic, financial and social globalization, 1970-202248
2.1. Climate change resilience (ND GAIN scores) and informal employment rate (percentages)63
2.2. Change in the share of informal employment in total employment, 2019–22 (percentage points)67
2.3. Employment levels in North America, seasonally adjusted (January 2021 = 100)68
2.4. Number of job vacancies per person unemployed69
2.5. Outflows of documented migrant workers, selected ASEAN Member States,
2010–20 (thousands)76
2.6. Projected labour force participation rates by ILO region and subregion, 2024 (percentages)81
2.7. Projected labour force growth between 2022 and 2024 by ILO region and subregion
(percentages)81
3.1. Labour productivity convergence across geographic regions, China
and country income groups92
3.2. Long-term labour productivity growth: G7 countries versus Brazil,
China and India (percentages)93
3.3. Average labour productivity growth in different ILO regions and countries,
selected periods (percentages)94
3.4. Labour productivity, informality, and working poverty95
3.5. Labour productivity and investment (percentages)98
3.6. Skills mismatches by country income group (percentages)102
3.7. Working-age population trajectories in some of the world’s most populous countries,
1980-2030 (percentages of total population)106
E1. Breakdown of growth in GDP per worker into growth in GDP per hour
and in hours worked per worker (percentages)180
F1. Average labour productivity growth in the main economic sectors, 1992–2018 (percentages)183
F2. Decomposition of labour productivity growth, selected economies (percentages)184
F3. Real value added and employment shares across sectors (percentages)185
List of tables
1.1. Employment and employment-to-population ratio, 2019–24, by sex, world and by country
income group 35
1.2. Weekly hours worked relative to the fourth quarter of 2019, percentages and FTE,
2020–24, world and by country income group37
1.3. Unemployment and unemployment rate, 2019–24, by sex, world and by country income group38
1.4. Extreme working poverty, 2000–22, world and by country income group43
2.1. Estimates and projections of working hours, employment, unemployment
and labour force, regional and subregional, Africa, 2019–2461
2.2. Estimates and projections for working hours, employment, unemployment
and labour force, regional and subregional, Americas, 2019–2465
2.3. Estimates and projections of working hours, employment, unemployment and labour
force, regional and subregional, Arab States, 2019–2471
2.4. Estimates and projections for working hours, employment, unemployment and labour
force, regional and subregional, Asia and the Pacific, 2019–2474
2.5. Estimates and projections for working hours, employment, unemployment and labour
force, regional and subregional, Europe and Central Asia, 2019–2479
9
Acknowledgements
World Employment and Social Outlook: Trends 2023 was prepared by the Macro-economic Policies
and Jobs Unit of the ILO Research Department, led by Ekkehard Ernst. The report was written
by Daniel Samaan, Ekkehard Ernst, Miguel Sanchez Martinez, Richard Horne and Stefan Kühn,
under the overall coordination and leadership of Stefan Kühn. Roger Gomis provided an exten-
sive contribution. Ekkehard Ernst supervised the process and provided decisive contributions.
The report was produced under the overall guidance of Richard Samans, Director of the ILO
Research Department. The authors are grateful for all the input and suggestions received from
the ILO Regional Offices for Africa, the Arab States, Asia and the Pacific, Europe and Central
Asia, and Latin America and the Caribbean.
The ILO modelled estimates presented in this report were produced by the Data Production
and Analysis Unit, led by Steven Kapsos, in the ILO Department of Statistics and by the
Macro‑economic Policies and Jobs Unit of the ILO Research Department. The authors especially
acknowledge the modelling work carried out by Evangelia Bourmpoula, Paloma Carrillo,
Roger Gomis, Stefan Kühn and Avichal Mahajan. The underlying database of international
labour market indicators used to produce the estimates was prepared by the Data Production
and Analysis Unit of the ILO Department of Statistics. The authors also wish to acknowl-
edge the efforts of David Bescond, Vipasana Karkee, Quentin Mathys, Yves Perardel and
Mabelin Villarreal-Fuentes.
Excellent comments and suggestions were provided by James Howard, Senior Adviser to the
ILO Director-General. The ILO Research Department wishes to acknowledge the comments and
suggestions provided by the following ILO colleagues: Catherine Saget, Christian Viegelahn,
Dorothea Schmidt-Klau, Dorothea Hoehtker, Elisenda Estruch-Puertas, Franz Ebert,
Hannah Liepman, Ira Postolachi, Kee Beom Kim, Kieran Walsh, Marie-Claire Sodergren,
Marva Corley-Coulibaly, Nicolas Maitre, Pelin Sekeler, Phu Huynh, Rebecca Napier-Moore,
Roger Gomis, Roxana Maurizio, Sajid Ghani, Sara Elder, Shane Niall O’Higgins, Sher Verick,
Simon Boehmer, Steven Kapsos, Syed Mohammad Afsar, Valeria Esquivel, William Boschetti,
Yashiko Kamakura and Yves Perardel. The authors also thank colleagues from ACTEMP and
ACTRAV for their excellent comments and suggestions.
We would like to express our gratitude to Judy Rafferty and our colleagues in the Publications
Production Unit for assisting with the production process, and to our colleagues in the ILO
Department of Communication and Public Information for their continued collaboration and
support in disseminating the report.
11
Executive
summary
Labour markets face

enormous challenges
The global outlook for labour markets deteriorated signifi-
cantly during 2022. Emerging geopolitical tensions, the Ukraine
conflict, an uneven recovery from the pandemic, and ongoing
bottlenecks in supply chains have created the conditions for a
stagflationary episode, the first period of simultaneously high
inflation and low growth since the 1970s. Policymakers face a
challenging trade-off as they deal with elevated inflation in an
environment of incomplete jobs recovery. Most countries have
not yet returned to the levels of employment and hours worked
seen at the end of 2019, before the outbreak of the COVID-19
health crisis. Yet, a series of supply shocks, predominantly in
food and commodities markets, have raised producer prices,
causing spikes in consumer price inflation and pushing major
central banks into a more restrictive policy stance. In the ab-
sence of corresponding increases in labour incomes, the cost-
of-living crisis directly threatens the livelihoods of households
and risks depressing aggregate demand. Many countries have
accumulated a significant amount of debt, in part to address
the severe fallout from the pandemic. The risk of a global debt
crisis therefore looms large, jeopardizing the fragile recovery
in many frontier markets.
In the midst of these challenging circumstances, major
decent work deficits persist around the world, undermining
social justice. Hundreds of millions of people lack access
to paid employment. Those who are employed all too often
lack access to social protection and fundamental rights at
work, the majority of workers being informal or unable to
express their interests through social dialogue. Incomes are
distributed highly unequally, such that many workers fail to
escape poverty. Labour market prospects are highly unequal,
not only across but also within countries. Gender gaps exist
in all areas of the world of work, and young people face par-
ticular challenges.
Informality and working poverty rose further with the
COVID-19 crisis. Despite the recovery that started in 2021, the on-
going shortage of better job opportunities is likely to worsen with
the projected slowdown, pushing workers into jobs In sum, an environment of high and persistent
of worse quality and depriving others of adequate uncertainty has emerged globally, depressing
social protection. Real labour incomes fall when business investment, especially of small and
prices outpace nominal incomes. The resulting medium-sized enterprises, eroding real wages and
downward pressure on demand in high-income pushing workers back into informal employment.
countries impacts low- and middle-income coun- Progress in poverty reduction achieved over the
tries through global supply chain (GSC) linkages. previous decade has largely faltered and con-
In addition, persistent disruptions to supply chains vergence in living standards and work quality
threaten employment prospects and job quality, is coming to a halt as productivity growth slows
especially in frontier markets, further reducing worldwide, making decent work deficits more
their prospects of a swift labour market recovery. difficult to overcome.
Challenging labour market conditions undermine social justice

Decent work is fundamental to social justice. Informality lacks many characteristics of the formal
Households rely overwhelmingly on labour income employment relationship that are important to
generated by decent work opportunities that advancing social justice. For example, the jobs are
offer a fair income, security in the workplace and much less likely to give access to social protection
social protection. systems than their formal counterparts. Overall,
only 47 per cent of people worldwide are effectively
The global jobs gap stood at 473 million people
covered by at least one social protection benefit,
in 2022, corresponding to a jobs gap rate
meaning that more than 4 billion people still lack
of 12.3 per cent. The global jobs gap is a new
any social protection.
measure of the unmet need for employment
in the world. It consists of the 205 million un- In 2022, an estimated 214 million workers were
employed – corresponding to an unemployment living in extreme poverty (earning less than
rate of 5.8 per cent – and 268 million people who US$1.90 per day per person in purchasing power
have an unmet need for employment but are out- parity [PPP] terms), corresponding to around
side the labour force because they do not satisfy the 6.4 per cent of employed people. Low-income
criteria to be considered unemployed. This jobs gap countries are estimated to have the same rate of
is particularly large for women and in developing extreme working poverty as in 2019, and a rising
countries. Although men and women currently face number of working poor. Without significant pro-
similar global unemployment rates, the jobs gap for gress to break this stagnation, the achievement
women is 15.0 per cent, compared with 10.5 per cent of Sustainable Development Goal (SDG) 1 – the
for men. Personal and family responsibilities eradication of poverty in all its forms – will be
(including unpaid care work), discouragement by impossible. As nominal labour incomes fail to
the lack of decent employment opportunities, and keep up with inflation, the cost-of-living crisis
scarcity of possibilities for (re)training can prevent risks putting more people into absolute or rela-
many people from seeking employment or limit tive poverty – where “relative poverty” equates
their availability to work at short notice. Low-income to falling below a national poverty line. This risk
and lower-middle-income countries present high is particularly elevated for those at the bottom of
job gap rates, between 13 and 20 per cent, whereas the highly unequal income distribution; the lower
upper-middle-income countries show a gap of half of workers globally earn only about 8 per cent
around 11 per cent and high-income countries of total labour income.
register a gap of only 8 per cent.
Women and young people fare significantly
Globally, around 2 billion workers were in worse in labour markets, a fact indicative of
informal employment in 2022. The incidence of large inequalities in the world of work in many
informal employment declined by 5 percentage countries. Globally, the labour force participation
points between 2004 and 2019. Employment rate of women stood at 47.4 per cent in 2022,
recovery from the COVID-19 crisis has been driven compared with 72.3 per cent for men. The gap
mainly by informal employment, which has caused of 24.9 percentage points means that for every
a slight increase in the incidence of informality. economically inactive man there are two such
women. Young people (aged 15–24) face severe of adults (aged 25 or more). More than one in
difficulties in securing decent employment. Their five – 23.5 per cent – of young people are not in
unemployment rate is three times as high as that education, employment or training (NEET).
Multiple crises are impeding employment growth

The ongoing impact of the COVID-19, cost-of- world, including in Africa. Meanwhile, population
living and geopolitical crises is weighing heavily ageing in almost all advanced and many emerging
on labour market prospects. Supply and demand countries has accelerated, causing a depression
shocks have triggered price increases, leading of labour supply that is unlikely to be offset by
to the highest inflation rates in decades. The outward migration from demographically more
Ukraine conflict and other geopolitical conflicts dynamic regions. At the same time, technological
are worsening supply shortages and raising uncer- change, pertaining especially to new digital de-
tainty. The ensuing cost-of-living crisis is eroding the vices and tools such as artificial intelligence, has
purchasing power of household disposable income yet to live up to earlier optimistic projections
and reducing aggregate demand. Tightening of about its potential to increase productivity
monetary policy is squeezing financing conditions growth and alleviate much of the drudgery of
not only in advanced economies but also through work, but such innovations are needed to address
spillovers to emerging and developing economies. some upcoming labour shortages resulting from
In the absence of proper policy coordination, the demographic shifts.
risk is that the dominant economies will pursue a
The interaction of macroeconomic factors, long-
policy agenda primarily catering to their domestic
term trends and institutional settings varies
challenges without due regard for the potential
and affects employment growth differently
collateral impacts. Job vacancies have started to
across country income groups. First, the macro-
fall sharply in those countries that have reported
economic outlook is pessimistic for high-income
them; however, they are falling from record levels
countries, whereas many other countries are
and in October 2022 remained high from a histor-
likely to see a normalization of growth after the
ical perspective.
higher growth rates of 2021 and 2022. Second,
Beyond these immediate challenges, longer- low social protection coverage in low-income
term structural changes in global labour and lower-middle-income countries means that
markets are increasingly being felt. For many workers won’t stop working but will be
example, climate change is contributing to a forced into the informal economy as economic
higher incidence of natural disasters and extreme activity slows. By contrast, countries with tried-
weather events, including flooding, drought, land and-tested employment retention schemes – most
degradation, soil erosion, heatwaves and unpre- of which are high income – will make use of them
dictable rainfall. Adjusting to these new realities again, thereby limiting employment losses. Third,
will require major adaptation initiatives, including enterprises in high-income countries could face
significant infrastructure investment in highly labour shortages in an ensuing upswing because
affected regions. Yet, these adaptation meas- of an ageing and contracting labour force, which
ures also present opportunities for job creation, will motivate them to hold on to their workers if
particularly in some of the poorest areas of the they can.
Employment growth is likely to slow significantly

Global employment is projected to expand by to have edged up to 1.1 per cent. The outlook is
1.0 per cent in 2023, a significant deceleration pessimistic for high-income countries, with close
from the 2.3 per cent growth rate of 2022. This to zero employment growth. By contrast, low-
projection for 2023 is a notable downward revi- income and lower-middle-income countries are
sion of 0.5 percentage points from the previous projected to see employment growth surpassing
projection. No major improvement is projected their pre-pandemic growth trend.
for 2024, when employment growth is expected
The slowdown in employment growth means projected to decline in 2023, but unemployment
that gaps opened up by the COVID-19 crisis, rates should increase only slightly against the
globally, are not projected to be closed in the backdrop of limited growth in the working-age
next two years. Strong employment growth in population. Indeed, in Europe and Central Asia the
2022 raised the global employment-to-population labour force is set to decline in 2023. Regardless of
ratio to 56.4 per cent, up from 54.5 per cent in 2020 these trends in headline labour market indicators,
but still almost half a percentage point below the each region will continue to face a myriad of decent
level of 2019. Total weekly hours worked in 2022 work deficits that are likely to worsen in the face
remained shy of their level in the fourth quarter of of global economic conditions and long-term
2019 by 1.4 per cent when adjusted for population challenges like climate change.
growth; this figure translates into the equivalent
Global labour supply growth is likely to con-
of 41 million full-time jobs (at 48 hours per week).
tinue its deceleration, which will contribute
Average weekly hours worked per worker are
to substantial labour shortages in advanced
projected to decline slightly in 2023 as a result of
economies in particular. Part of this deceleration
the economic slowdown, to remain at just above
is to be expected because over the past decade
41 hours per week. This reduction in activity limits
both developing and emerging countries have
the earnings potential of workers and in all like-
experienced rising income levels that have
lihood lessens opportunities for transitions into
allowed many younger citizens to extend their
better-quality, well-paying jobs.
time in education. Nevertheless, a large share
Employment growth in 2021 was robust as key of young people remain outside employment,
sectors of the economy reopened, and labour education or training (the so-called NEET rate),
market conditions continued to improve in 2022. which will adversely affect their future labour
The employment-to-population ratio surpassed market opportunities. Reducing these NEET rates
its pre-crisis level in Europe and Central Asia in continues to be a significant challenge that needs
2022 and has recovered the majority of its losses to be addressed if the global economy is to benefit
in the other regions. Women, disproportionately from the youth bulge in the demographic profile
affected by employment losses in 2020, have of many developing countries. Even partially
seen particularly strong employment growth. closing the global jobs gap by expanding gainful
By 2022 their employment-to-population ratio employment would reduce decent work deficits
had recovered to within 0.3 percentage points and boost economic activity. Advanced economies
of the pre-crisis level, compared with a gap of have made considerable progress in this regard,
0.6 percentage points for men. However, this offering opportunities for older workers in par-
stronger recovery was mainly driven by informal ticular to remain attached to the labour market;
employment: four out of five jobs created in 2022 this is the only group of countries where labour
for women were informal, versus only two out of force participation rates have increased over the
three for men. past decade rather than declined.
The labour market outlook for 2023 varies con- Global unemployment is projected to edge up
siderably by region. Africa and the Arab States slightly in 2023, by around 3 million, to reach
should see employment growth in the order of 208 million. This corresponds to an unemployment
3 per cent or more. However, with their growing rate of 5.8 per cent. Despite the negative global
working-age populations, both regions are likely economic outlook, global unemployment is pro-
to see unemployment rates decline only modestly jected to increase only moderately, since a large
(from 7.4 to 7.3 per cent in Africa and from 8.5 to part of the shock is being absorbed by rapidly
8.2 per cent in the Arab States). In Asia and the falling real wages in an environment of accelerating
Pacific and in Latin America and the Caribbean, inflation. However, although global unemployment
annual employment growth is projected to be declined significantly in 2022, down to 205 million
in the order of 1 per cent. In North America, from 235 million in 2020, it still remained 13 million
there will be no employment gains in 2023 and above the 2019 level. In 2022, unemployment rates
unemployment will pick up. Europe and Central fell below their pre-crisis level only in the Americas
Asia are particularly hard hit by the economic and in Europe and Central Asia; they remain above
fallout from the Ukraine conflict; employment is that level in the other regions.
Job quality is under pressure as well

Beyond the gap in employment, job quality some workers and enterprises – for example, those
remains a key concern. Without access to social operating in the energy sector – experience income
protection, many people simply cannot afford to gains higher than the inflation rate, which thus
be without a job. They often accept any kind of raise their real income. Falling real incomes are
work, often at very low pay and with inconvenient particularly devastating for poorer households,
or insufficient hours. The projected slowdown is which risk slipping into poverty and food insecurity.
therefore likely to force workers to accept jobs In sub-Saharan Africa and South Asia, respectively,
of worse quality than they might enjoy in better 60.8 per cent and 34.7 per cent of the employed
economic conditions. Furthermore, with prices population in 2021 were considered to be working
rising faster than nominal wages, workers will poor at the US$3.10 per day (PPP per capita) level.
experience rapidly declining disposable incomes
even when they can keep their current jobs. Global supply chain linkages are propagating
to low- and middle-income countries the slow-
Such decent work deficits vary by region in down in demand in high-income countries. An
form and severity, yet they are widespread. estimated average of 11.3 per cent of jobs in the
In the Arab States, North Africa and South Asia, sample of 24 middle-income countries with avail-
gender-related differences in labour market able data – excluding those in agriculture and non-
indicators, including labour force participation market services – are dependent on GSC linkages
rates, are substantial. In Latin America and the to high-income countries (see Appendix D). In some
Caribbean, and sub-Saharan Africa, elevated rates smaller economies, the proportion well exceeds
of informality inhibit access to social protection and 20 per cent. In middle-income countries, sectors
fundamental rights at work. All regions are afflicted with higher GSC integration tend to have a larger
by one or another form of decent work deficit. The share of wage and salaried employment, a lower
current deterioration in global economic conditions incidence of informality and a lower proportion
is likely to reverse past progress and worsen these
of low-paid employees – and hence in principle
deficits in several directions.
a higher quality of employment. Since a slump in
Inflation has a strong impact on the distribution demand in high-income countries is likely to shift
of real incomes. Many workers and enterprises are employment growth in middle-income countries
unable to increase their income in line with inflation to activities not linked to GSCs, the average quality
and they hence suffer real income losses. However, of employment may then decline.
Productivity growth remains vitally important

The long-term slowdown in productivity growth generating dramatically lower greenhouse gas
in advanced economies has spread to major emissions. The last two decades, however, have
emerging economies. This is a matter of much seen a gradual deceleration in productivity growth,
concern, since growth in productivity is key to most pronounced in advanced economies but in-
addressing today’s multiple crises in purchasing creasingly evident in major emerging economies
power, well-being and ecological sustainability. as well.
To address threats to decent work and well-being, Not only has productivity growth slowed but
including widespread poverty, informality, and lack the fruits of such growth are also being shared
of safe and secure workplaces, will require invest- less equally. The global labour income share
ment, innovation and the diffusion of technological was on a declining trend in the decade and a half
progress. For example, investment in people’s skills preceding the COVID-19 crisis. Decades of falling
and capabilities is widely recognized as a central (real) minimum wages, erosion of once strong
factor in labour productivity growth. Moreover, labour market institutions, and failure to revive
the climate goals of the Paris Agreement require social dialogue on a larger scale have prevented
an acceleration of technical progress to enable labour from participating more fully and equitably
economies to grow while using energy and other in the benefits of economic growth. Rising indus-
natural resources much more efficiently and trial concentration in certain sectors is further
fuelling inequality and hindering economic dyna- of economic uncertainty. Ever since the global
mism, especially among small and medium-sized financial crisis, economic uncertainty has been
enterprises. Worsening inequality and slowing pervasive, hindering investment notwithstanding
productivity growth reinforce each other because the low level of interest rates. This investment
they concentrate income gains in a way that fails slowdown has often been accompanied by a
to stimulate investment. shift from business to residential investment,
which is less conducive to rapid productivity im-
The pace of technological innovation in the
provements. Part of the reason is the volatility
digital economy is high but the benefits are
not being shared widely. Industry concentration of general economic conditions stemming from
is particularly prevalent in the digital economy recent crises, which have made businesses reluc-
because of the substantial role of intangible assets tant to expand capacity or start new ventures.
in the business model, causing productivity growth Movement towards a more stable macroeconomic
to diverge between a few leading companies and environment would probably help to close some
the rest. Digital innovations have yet to produce of the investment gap that the pandemic has
economy-wide spillovers in productivity that would magnified. Stronger action to address inequalities
boost jobs and growth. Rather, concentrated would also help to stimulate investment activity
productivity gains have skewed the distribution of by leading to more broadly based increases in
high-skilled job opportunities towards a few tech- disposable incomes.
based industries, exacerbating both inequality A deteriorating labour market outlook and
and the (aggregate) productivity slowdown. increases in informal employment have further
Technological breakthroughs are still missing that undermined incentives for productive invest-
bring with them society-wide benefits, for instance ment. Given the substantial rise in uncertainty re-
in mobility management or grid management garding the future course of the global economy,
for the transition to sustainable energy. Other employment expansion is fastest among informal
opportunities could arise to facilitate the shift workers. This will have knock-on effects on invest-
towards remote and hybrid work and to address ment rates that have continued their long-term
the need for innovative solutions to support col- decline, at least in advanced economies and re-
laboration in an ever more diverse labour market. gardless of the short-term direction of interest
Regulatory and policy innovation is needed to
rates. Moreover, increases in this type of work are
strengthen technological development in areas
associated with lower wage growth and reduced
with high social returns, using a mix of stand-
incentives for employers to invest in workforce
ard-setting and public procurement approaches
upgrading and upskilling. With weakened labour
and productivity-enhancing collaborations among
market institutions, many countries lack mech-
social partners.
anisms to limit or prevent further erosion of real
Productivity growth has suffered from weak- wages and hence to support aggregate demand
ening investment, partly owing to high levels and balanced and inclusive economic growth.
Downside risks are therefore significant in 2023

The labour market outlook is characterized and declining real incomes in the face of rising
by multiple downside risks. Today’s “polycrisis” prices could suppress demand for domestically
could push global economic growth in 2023 produced goods and services, thereby further
below 2 per cent, with serious implications for reducing employment growth, particularly in the
employment creation. Even without such further formal sector.
deceleration of growth, labour market prospects Despite the overall slowdown in employment
could deteriorate if for example businesses were growth, shortages of qualified labour remain
unable to hold on to workers owing to financing a risk in certain countries and sectors. A major
constraints, or governments found themselves in a increase in investment in education and training
debt crisis and unable to support labour markets. is necessary to unlock the full potential of the
In low- and middle-income countries, inequality global labour force. Currently, two thirds of
the global youth labour force remain without a of education over the past decade, thereby
basic set of skills, a circumstance that restricts their contributing to the deceleration of productivity
labour market opportunities and easily pushes growth. In the current environment of challenges
them into lower-quality forms of employment. to both productivity and employment, a broad-
Indeed, the expansion of labour force partici- based labour market initiative focusing on both
pation in advanced economies often came at the employment and skills is necessary to make the
price of a gradual decline in the average quality labour market work for all.
Global policy space is fragmented

The coronavirus pandemic has created sig- critical than ever. Strong commitment to initiatives
nificant capacity challenges for major policy- such as the UN Global Accelerator on Jobs and
making institutions. Central banks around the Social Protection for Just Transitions as well as the
world face difficult trade-offs between further close involvement of social partners in all areas of
supporting recovery from the pandemic and policymaking at national and international levels are
addressing elevated inflation. Although many key measures that will strengthen policy coherence
countries have not yet recovered to pre-pandemic and partnerships to tackle current challenges and
levels in terms of hours worked, shocks to energy respond to long-term trends in the future of work.
and food prices have brought a need to normalize
Amidst large deficits in decent work and social
policy and reduce the emergency measures intro-
justice, a new global social contract is needed to
duced during the pandemic. Governments that
enhance the resilience of economies and societies
have accumulated a significant amount of debt
in the face of today’s multiple crises. The ILO’s
to support local businesses and households now
2019 Centenary Declaration and 2021 global call
find themselves under pressure to phase out some
to action for a human-centred recovery from the
of their support measures, if they have not done
COVID-19 crisis which is inclusive, sustainable and
so already.
resilient frame the core elements of such a strategy
Just as the recovery from the pandemic has at the national and international levels. To this end,
remained uneven across countries, so has the in 2023 the ILO will promote a Global Coalition
exposure to geopolitical tensions and price hikes for Social Justice aimed at strengthening global
stemming from supply disruptions. European solidarity and improving policy coherence in order
countries are facing substantial and sudden rises to bring about action and investments in decent
in energy costs which are contributing to a stag- work and social justice.
flationary dynamic. Among African countries, the
Accelerated progress in reducing the global jobs
food price increases experienced in previous years
gap, strengthening the quality of jobs and pro-
have worsened; many sub-Saharan countries are
tecting real incomes will require renewed policy
not self-sufficient in food production and their
coordination and social dialogue. A strengthened
food imports are not well diversified. Around the
global social contract will also need to integrate
world, ensuring access to basic goods and ser-
longer-term objectives, addressing threats from
vices at reasonable prices has become a national
climate change while resolving deficits in develop-
preoccupation, sometimes without regard for the
ment and living standards, in part through faster
international spillover effects of such action.
productivity growth. Governments and social
In the response to multiple economic and partners should seize the moment to deepen their
geopolitical crises, international solidarity is more collaboration to this end.
1
Stalled labour
market recovery
undermines
social justice
X Overview
A worsening global economic outlook threatens to exacerbate

decent work deficits. Rising geopolitical tensions, an uneven
recovery from the COVID-19 pandemic, and bottlenecks in supply
chains that are only slowly easing have created conditions for
“stagflation”, the first period of high inflation coupled with low
growth since the 1970s.1 The large swings in consumption and
disruptions in supply chains that accompanied the pandemic led to
asymmetric demand and supply shocks, causing labour shortages
and rising prices in a number of sectors. Inflation – in particular,
high food and energy prices – is eroding disposable income, with
repercussions for aggregate demand and the ability of the poorest
in the world to maintain adequate living standards.
1 By September 2022, the Global Supply Chain Pressure Index had started to
fall back to levels seen before the pandemic (Federal Reserve Bank of New
York 2022). In contrast, the indicator of shortage of intermediate inputs among
German manufacturers remained, in the third quarter of 2022, at the high levels
experienced during the pandemic, far above shortages experienced during
previous business cycles (DESTATIS 2022).
These inflationary pressures have prompted population being covered by social protection
major central banks to take a more restrictive (ILO 2021a). In 2020, around 160 million children
monetary policy stance. The ensuing increases in the world were in child labour, most of them
in interest rates, compounded by the conflict working in agriculture (ILO 2021b). This, together
in Ukraine, are slowing economic activity and with the around 28 million people in forced labour
raising the spectre of financial instability in (ILO 2022b), means that a total 188 million people
highly indebted countries.2 This is significantly are in forms of work that should be abolished.
increasing uncertainty and deterring the busi-
ness investment on which continued reduction Women and young people fare significantly
in unemployment and working poverty d epends. worse in labour markets, an indication of the
In short, the progress in decent work and social large inequalities within the world of work in
justice that many countries achieved in recent many countries. Globally, the labour force partici-
decades is at risk of being eroded for many years pation rate (LFPR) of women stood at 47.4 per cent
to come. in 2022, compared with 72.3 per cent for men.
The gap of 24.9 percentage points means that
Decent work deficits remain very large in
for every economically inactive man there are
the midst of such challenging circumstances
two such women. Young people (aged 15–24)
(figure 1.1 ). About 473 million people around
face severe difficulties in securing and keeping
the world are deprived of earning an income
through employment. They include 205 million decent employment. Their unemployment rate is
unemployed – those who satisfy the requirements three times as high as that of adults (aged 25+).
of having recently searched for a job and being More than one in five – 23.5 per cent – of young
available at short notice. Thus there are 268 mil- people are not in education, employment or
lion people who do not satisfy these requirements training (NEET).
but have an unmet need for employment.3 Two Longer-term trends show progress on re-
billion of those who are employed have an in- ducing decent work deficits on some fronts,
formal job, meaning that they are significantly
but that this is not fast enough. Although the
less likely to have rights at work, to have a voice
decline in the extreme working poverty rate from
through social dialogue or to enjoy the benefits of
35 per cent in 1991 to 6.4 per cent in 2022 is a
social protection systems. This is particularly true
notable success, the absence of further progress
in rural areas (ILO 2022a). Furthermore, 214 mil-
in low-income countries means that the num-
lion people are in employment but are unable to
bers of working poor in those countries are on
escape extreme poverty – they and their families
the rise. The decline of the informality rate by
live on less than US$1.90 per person per day in
purchasing power parity (PPP) terms.4 Global 5 percentage points over the past 18 years is too
labour income is distributed highly unequally, slow for widespread formalization to be expected
the bottom 50 per cent of workers earning only any time soon. The gender gap in the LFPR has
around 8 per cent of global labour income. This remained essentially unchanged over the past
inequality is partly driven by a vast gap in labour three decades. The NEET rate among young
productivity: gross domestic product (GDP) per men has increased over the past 17 years, while
worker in high-income countries is 18 times that in it has declined among young women. The global
low-income countries. Access to income support labour income share has declined since 2004.
for those who fall out of employment is also highly Meanwhile, unemployment is generally a cyclical
unequal across the world, only 47 per cent of the phenomenon, without a clear long-term trend.
2 The Capital Flows Tracker of the Institute of International Finance shows large net capital outflows from emerging markets
in the first half of 2022, but some reversal in August to October 2022 (https://www.iif.com/Products/Capital-Flows-Tracker).
3 As the 19th International Conference of Labour Statisticians (ICLS 2018) established, labour underutilization implies an unmet
need for employment of which unemployment is one of the measures.
4 The World Bank revised the threshold for extreme poverty to US$2.15 per day (PPP) during 2022. This change could not yet
be taken into account in the production of estimates for this report, but it will be taken into account in future editions.
X Figure 1.1. Overview of deficits in decent work and social justice, 2022 or latest year available
473
million
2
times
23.5
per cent
Jobs gap Gender gap Young people
473 million want employment – Twice as many women as men 23.5% of youth are
205 million of them are unemployed are outside the labour force not in education,
(meaning actively looking for work) employment or training
2
billion
214
million
47
per cent
Informal employment Working poverty Social protection
2 billion informal workers 214 million workers in extreme Only 47% of the population
with limited rights at work poverty (< US$1.90 PPP per day) are covered by at least one
or access to social protection form of social protection
8
per cent
18times
188
million
Inequality Productivity gap Employment to be abolished
Half of workers earn only Labour productivity is 18 times 160 million children in child
8% of global labour income greater in high-income countries labour and 28 million workers
than in low-income countries in forced labour
Note:Estimates for labour income refer to 2019, estimates for child labour to the beginning of 2020.
Source:ILOSTAT, ILO modelled estimates, November 2022; ILO social protection database; ILO (2021b).
The COVID-19 crisis has exacerbated decent This chapter presents trends and projections
work deficits that existed before the pan- of key labour market indicators globally and
demic (ILO 2021c). In 2020, total hours worked by country income group. First, the chapter
fell short by an estimated 8.7 per cent relative discusses the multiple crises that have created
to the fourth quarter of 2019, corresponding such a challenging environment for labour
to the equivalent of 252 million full-time jobs markets. Next, the key indicators of quantity of
(at 48 hours per week). Although losses of work are presented: labour force, employment,
working hours and therefore also of income working hours and labour underutilization. The
occurred worldwide, the unequal provision chapter subsequently investigates trends in the
of income support measures reinforced ex- types of jobs that people have, and the impli-
isting income inequalities across countries, cations for social justice, and then concludes
since these inequalities depended on the scale with some policy implications.
of existing and emergency social protection
The accumulation of risk factors has resulted
systems. Within countries, too, inequalities
in a highly uncertain labour market outlook.
rose, since women, for instance, and also
This comes on top of uncertainty about the
workers in low- and medium-skill occupations
impact the COVID-19 crisis has had on the
suffered greater losses of employment (ILO
world of work. 5 Consequently, the labour
2022c). Downward trends in the incidence
market indicators presented in this report are
of informality and working poverty have
subject to substantial uncertainty.6 The term
been halted and reversed in the wake of
“employment” as used here applies to activities
the COVID-19 crisis. With a few exceptions,
within the production boundary defined by
most countries have not yet returned to the
the United Nations (UN) System of National
employment and working hours levels – once
Accounts and follows the definition established
adjusted for population growth – seen at
by the 13th International Conference of Labour
the end of 2019, before the outbreak of the
Statisticians (ICLS). The term “work”, according
health crisis. Recovery has been lagging behind
to the more recent standards (adopted by the
in low-income and lower-middle-income
19th ICLS), is defined as any activity performed
countries – where many indicators of decent
by persons of any sex and age to produce goods
work are particularly worrisome.
or to provide services for use by others or for
Global employment growth is projected to one’s own use. This distinction is important
decline drastically in 2023 following the rapid because more people are engaged in work
expansion in 2022. This will entrench the di- (19th ICLS concept) than are in employment
vergence in recovery, making it very difficult for (13th ICLS concept). Women in particular do
low-income and lower-middle-income countries large amounts of work, such as unpaid care
to close the gaps with respect to high-income work, that is not captured by the reported
countries which opened during 2021 and employment figures (ILO 2022d). In this report,
2022. The reduction in global unemployment however, the term “work” is used on occasion
achieved in 2021 and 2022 will also stall; a mod- as a synonym for “employment” for ease of
erate increase is projected for 2023 and 2024. exposition. All statistics presented in the text
Hours worked per person employed are also without an explicit reference are published
projected to decline amidst slowing economic in the ILO modelled estimates repository of
activity and remain significantly below their ILOSTAT;7 many can also be found in the WESO
pre-pandemic level. Data Finder.
5 Many countries conduct labour force surveys infrequently. The missing values are imputed to obtain global estimates
of labour market indicators, published in the ILO modelled estimates. In normal times, the imputed values of labour
market indicators for years when no survey was conducted have relatively small error bounds thanks to the econo-
metric techniques used to produce the ILO modelled estimates. Owing to the size and nature of the COVID-19 shock,
the precision of the labour market estimates has declined.
6 Regions that are composed mainly of countries with good coverage through labour force surveys have a small error
for indicators up to and including 2021. These include the Americas and Europe.
7 See Appendix B for details on the ILO modelled estimates series.
X A challenging macroeconomic environment

for labour markets
The cost-of-living crisis is 2021, activity resumed quickly, thanks to pent-up

demand stimulated by forced savings built up
eroding disposable incomes at the beginning of the pandemic. As a conse-
quence, several sectors, including aviation and
A combination of asymmetric demand and
tourism, experienced serious capacity shortages.
supply shocks has increased core inflation
Surprisingly, the strength of these shocks seems
rates. 8 Part of these problems stems from the
to have been underestimated by policymakers
large swings in consumption observed during the
despite them having been fully anticipated (Ernst
pandemic when demand shifted away from ser-
2020; OECD 2020).
vices towards (electronic) goods in 2020, to swing
back to services in the course of 2021 as economies Rising prices for energy and food, driven by
around the world gradually lifted workplace and cyclical factors and reinforced by supply dis-
travel restrictions. Supply adjustments did not ruptions caused by the conflict in Ukraine,
take place at the same speed, however. Especially pose existential threats for the poor. By March
the rising demand for goods together with the 2022, the global food price index had reached
simultaneous decline in maritime transportation 159.7 points, the highest level since the start of
capacity led to significant disruptions in global the series in 1990 (figure 1.2). Thereafter, prices
supply chains (GSCs) (Rees and Rungcharoenkitkul eased, but in September 2022 they were still
2021). With the gradual opening that began in 43 per cent higher than the average of 2019 and
X Figure 1.2. Food and energy prices indices
400
350
300
250
200
150
100
50
0
2004 2006 2008 2010 2012 2014 2016 2018 2020 2022
Energy index FAO food price index
Note:Food and Agriculture Organization (FAO) food price index with average price of 2014–16 equalling 100.
Source:International Monetary Fund (IMF) primary commodity price system; FAO.
8 In a sample of 35 countries, median core inflation rates started to increase in the second quarter of 2021, from around 2 per cent,
to reach 6.5 per cent in the third quarter of 2022 (IMF 2022).
stood at similar levels as during the last global the gradual erosion of trade union membership
food price crisis, in 2011. Energy prices had risen and a fall in industrial employment have led to
to three times the average price of 2019 by a phasing out of automatic indexation of wages
August 2022, surpassing the price level of the and other nominal anchors, preventing real wages
last high-price period, 2011–14, by 60 per cent. from fully reflecting increases in productivity.11
The combination of high energy and food prices is The unexpected acceleration of inflation came to
causing a cost-of-living crisis for many households, the detriment of workers, who find themselves on
which may become existential for poorer ones the losing side of surprise inflation. Meanwhile,
that tend to spend a larger share of their income the decline of unionization rates and collective
on food and energy.9 Many enterprises too – in bargaining coverage has reduced the power
particular, small and medium-sized ones without of social dialogue to elicit a fair sharing of the
much market power to pass on cost increases cost of inflation (ILO 2017a). In the absence of
to consumers – face an existential threat from redistributive efforts, the majority of households
rising energy prices (Global Alliance for Improved will see declining real incomes, which will cause
Nutrition 2022). The energy price index is a global aggregate demand to fall.
average; the regions have a varying energy mix,
Countries that are experiencing deteriorating
and some energy markets – such as electricity and
terms of trade face additional declines in real
to some degree natural gas – are local and hence
incomes as a result of inflation. These countries
exhibit large price variations around the world.
need to spend significantly more on imports of
As a result, double-digit inflation rates are food and energy, thereby transferring purchasing
affecting more than 2 billion people worldwide power to net exporters of those items.12 This in-
(UNCTAD 2022), deepening inequalities within creased spending can cause balance-of-payment
countries and lowering aggregate demand. crises for developing countries with limited op-
Energy producers and enterprises with market portunities to borrow internationally, thereby
power are earning record profits while other worsening financing conditions for governments
enterprises are struggling to pass on cost and enterprises.13
increases to their customers or are feeling
the crunch of reduced demand.10 Workers are
already experiencing a significant decline in real Options for fiscal and
income and often lack bargaining power to seek monetary policy are limited
compensation for these losses or are employed
by struggling enterprises that are unable to raise Global policy space is limited and fragmented.
their pay. The Global Wage Report 2022–23 shows The COVID-19 pandemic has left a large dent in
that global real wages are estimated to have the capacity of major policymaking institutions.
declined by 0.9 per cent in 2022 (ILO 2022e). Even Central banks around the world have exhausted
among low-wage service workers in advanced their capacity to support the recovery. Similarly,
economies, who have seen the fastest increase fiscal policymakers have accumulated a substantial
in wages in decades owing to a shortage of labour, amount of debt in order to support local businesses
wage growth is barely keeping par with inflation. and households and are increasingly compelled
Labour market and social protection reforms, to phase out some of the support measures, if
9 Price indices show the nominal changes in prices. The evolution of incomes needs to be considered as well to evaluate the
impact of price changes on households.
10 In 2021 and 2022, price hikes amidst still strong consumer demand meant that many companies were able to increase their
profits margin. In the United States, corporate profits before tax as a proportion of gross national product rose from an average
of 10.7 per cent in 2018–19 to an average of 13.4 per cent in 2021 and the first two quarters of 2022 (calculations based on
https://fred.stlouisfed.org/).
11 On the evolution of trade unionization rates and collective bargaining arrangements see Visser (2012) and ILO (2022h).
12 The terms-of-trade effect lowered real incomes by 1.3 per cent in the euro area in the fourth quarter of 2021 (ECB 2022). Energy
prices have risen significantly since then.
13 Even in developed economies with well-integrated financial markets fiscal policy can become constrained through financial
markets requesting significantly higher risk premiums, as shown by events in the United Kingdom in October 2022 surrounding
the proposed large fiscal deficits that necessitated intervention by the Bank of England.
they have not done so already. Rising interest High levels of inequality that have built up
rates, along with a strong US dollar, threaten the over the past few decades are compounding
ability of countries to refinance debt, especially challenges for central bankers in their attempt
when coupled with capital flight. Between 2019 to bring down inflation rates. With an ever larger
and 2022 the proportion of low-income countries proportion of aggregate consumption driven by
experiencing debt distress or facing a high risk well-to-do households that are insensitive to
of debt distress increased from 49 per cent to interest rate hikes, there is a risk that a monetary
56 per cent. It is of utmost importance to ensure policy much tighter than in the past will be
that governments continue to have access to perceived as necessary in order to produce a
significant impact on inflation (Pereira da Silva
finance, since the implementation of austerity
et al. 2022). This will disproportionately raise the
measures, or a situation of being forced to
cost for poorer households and also for businesses
implement them by financial market distress during
with high levels of external financing.
an economic downturn, would be catastrophic for
labour markets. In the absence of proper policy coordination,
the risk is that large advanced and emerging
Fiscal policy needs to balance conflicting goals.
economies will pursue a policy agenda primarily
On the one hand, countries should avoid a gen- catering to their own domestic challenges,
erally expansionary fiscal stance that would run without regard for the wider global spillovers.
counter to the efforts of monetary policy. On the Monetary policy tightening, in particular, seems
other, hard-hit enterprises and households do re- to be reacting to immediate inflation concerns
quire support to weather the crisis. Consequently, without sufficient consideration of intertemporal
support needs to become more targeted at and international spillovers (Obstfeld 2022). This
low-income households, vulnerable workers and may be creating an overly tight global macroeco-
struggling small and medium-sized businesses.14 nomic environment that will have an unduly severe
impact on the real economy and labour markets
Given the current economic policy consensus,
around the world. Alternative policy responses
the process of keeping inflation under control
that balance demand- and supply-side measures
will be painful for households and many enter-
and protect the most vulnerable through targeted
prises. Although inflation is driven more by supply
interventions could offer a more effective means
than by demand factors (IMF 2022), most policy of combating inflation while sustaining economic
action has focused on demand-side management growth and development.
to counter expectations of rising inflation. In par-
ticular, the current policy response in advanced
economies relies very much on monetary policy Short-term economic outlook
causing a contraction in aggregate demand, as
The multitude of challenges are causing a slump
evidenced by the record pace of interest rate hikes.
in confidence – accelerated by the Ukraine con-
Workers will experience pressure on incomes
flict – which will feed into economic contraction.
under such a policy, either because of reduced
GDP-weighted policy uncertainty across 21 coun-
jobs growth, or job losses, or because of falling real tries has been found to have risen since 2021
wages for those who remain employed. Reduced and is at levels far above the long-term average,
aggregate demand also raises competitive although not quite reaching the uncertainty ex-
pressure on firms, thereby limiting price hikes perienced during the early phases of the pandemic
and potentially reducing their profit margins.15 (figure 1.3). Median consumer confidence has fallen
A more balanced approach is needed to limit the to its lowest level in the past two decades in a
economic and social pain, focusing on measures to sample of 44 countries (figure 1.3), highlighting
bolster supply – including accelerated investment the severe impact of the cost-of-living crisis on
in sustainable energy production. households. Median business confidence across
14 Untargeted or poorly targeted support can enable low-productivity enterprises to survive (“zombie firms”), thereby locking in
resources and reducing potential for productivity growth (see Chapter 3). In developing countries, though, many micro, small
and medium-sized enterprises would continue operations anyway but would likely fall into the informal sector.
15 Profit margins are generally procyclical (Macallan, Millard and Parker 2008).
X Figure 1.3. Median consumer and business confidence indicators (standard deviation
from mean) and policy uncertainty, February 2004 to September 2022
–1
–2
–3
2004 2006 2008 2010 2012 2014 2016 2018 2020 2022
Policy uncertainty Business confidence Consumer confidence
Note:The figure shows the median of the standardized consumer confidence indicator across a sample of
44 countries, and the median of the standardized business confidence indicator across a sample of 14 countries.
The policy uncertainty index is a GDP-weighted average across 21 countries. The original series has been rescaled
for display in this figure by dividing the policy uncertainty index by 100 and subtracting 1. All series have been
converted to show the three-month rolling average. The vertical line marks the start of the Ukraine conflict.
Source:Tradingeconomics; http://www.policyuncertainty.com.
14 countries is equally on a downward trend, but In low- and middle-income countries, excluding
in September 2022 the median confidence level China, projected per capita growth is the same
was just below the long-term average. The more as or even larger than the average growth
positive feeling among businesses is good news achieved from 2010 to 2019 (figure 1.4). Low-
for labour markets, since employers are less likely income countries in particular are projected to
to lay off staff, at least for now. achieve significantly higher per capita growth
than in the previous decade. Moreover, the pro-
The global economy is forecast to grow a mere jected global growth in 2023 still exceeds the
2.7 per cent in 2023, far below the 3.6 per cent rate recorded during the financial crisis of 2009.
average annual growth between 2000 and 2021 Thus, although the current slowdown in growth
(IMF 2022). This prediction is down by 0.9 per- will seriously damage efforts to recuperate the
centage points since April 2022, highlighting the output losses incurred through the pandemic, it
marked deterioration of economic conditions. The does not imply that a major global recession is in
slowdown means that, instead of a recuperation of store, especially outside the high-income countries.
the output losses incurred during the pandemic, There is a risk, though, that the global economy
the output gap relative to the pre-crisis trend is will enter a recession if a number of risk factors
widening again. The significant slowdown in the materialize (Guénette, Kose and Sugawara 2022;
world’s three largest economies – China, the euro IMF 2022). The labour market projections in this
area and the United States of America – is a major report are based on the baseline projection of
contributor to the global downturn. World Economic Outlook, October 2022 (IMF 2022).
X Figure 1.4. Growth of GDP per capita, 2010–23, world and country income groups
(percentages)
2010–19 2020 2021 2022 2023
World 2.1 –4.1 5.0 2.2 1.7
Low-income countries –0.7 –3.2 1.7 1.0 2.4
Lower-middle-income countries 3.5 –4.5 4.4 3.6 3.7
Upper-middle-income countries
1.1 –5.9 5.5 1.6 1.1
(excluding China)
High-income countries 1.4 –4.8 5.0 2.3 0.8
Source:ILO calculations based on IMF (2022) and UN population prospects, 2022 revision.
Long-term trends affecting biodiversity or melting of permafrost could ac-

celerate the rise in temperature, causing large
labour market dynamics output and employment losses, especially in
countries with already fragile ecosystems and
Underneath these short-term developments
high average temperatures. By 2030 an estimated
run larger tectonic shifts that are increasingly
2.2 per cent of global working hours could be lost
being felt. Population ageing is exacerbating
to heat stress, mostly in agriculture and construc-
labour shortages in some countries, while
tion (ILO 2019a).
countries with still rapidly expanding populations
face challenges to provide the young generation The transition to net-zero carbon emissions
with sufficient opportunities for productive decent may not come cheap but it will also create
work. Productivity growth faces severe headwinds, opportunities. The current energy price crisis
which threaten the prospects of eliminating may worsen as societies shift towards local green
working poverty, reducing global labour income technologies. Moreover, as advanced economies
inequality and allowing countries to cope with move away from fossil fuels, the price of these
ageing populations while maintaining standards fuels is likely to drop, creating an incentive for
of living (see Chapter 3). A changing world of less developed countries to rely more rather
work – driven also by digitalization and the growing than less on carbon-driven energy production.
needs of the care economy – is altering enterprises’ However, evidence abounds that a faster transition
skills requirements and hence producing skills to a net-zero carbon emission economy will be
mismatch when skills needs are not properly beneficial not only from an ecological but also
addressed through the education system and from an economic point of view (Way et al. 2022;
lifelong learning (ILO 2021d; Carolina Feijao, van IMF 2022). Such a transition could create a net
Stolk Flanagan and Gunashekar 2021). 18 million jobs worldwide (ILO 2018a).
Climate change and mitigation policies are A just transition will involve a (moderate)
likely to impact living standards. The past year reduction in living standards which will need
has seen a series of climatic exceptions that have to be shared equitably, internationally, within
reminded the global community that climate countries and across generations. Delaying the
change is accelerating, causing rising and sizeable necessary adjustment will simply increase the costs
costs even though the global temperature has without making the distributional consequences
not yet reached the threshold of a 1.5 ºC increase any less complicated. Social protection measures
(IPCC 2018). Several climatic tipping points seem and targeted income support, alongside skills
to be near. The crossing of these will significantly policies to support transitions from “brown” to
increase adaptation costs. Irreversible loss of green jobs, will need to be stepped up, in particular
in countries that have the financial means to do carbon sinks in the Global South (Barga 2022). Such
so.16 To create more space, especially in low-income programmes need to be designed with a labour
countries, new forms of international climate market angle in mind in order to facilitate decent
agreements need to be found that will channel work creation aligned with payment for ecosystem
part of the climate-related funds levied among services, for instance (ILO 2018a).
high-income polluters to strengthen investment in
X Labour supply, employment and shortage of jobs
In the coming years, employment growth will opportunities for certain groups, discouragement,
stall, workers will have a harder time finding gender discrimination and other factors that inhibit
quality employment and real incomes are likely participation – meaning that lower participation
to fall. The reasons for these developments are rates are not a good thing per se.
to be found in the dynamics of labour supply
The working-age population has started to
and demographic change, in the structure of
shrink in a number of high-income countries.
labour markets and in the institutional context Among emerging economies, China saw a first
of employment creation and destruction. These reduction in its working-age population in 2015,
determinants differ across countries; differences and this reduction is projected to accelerate.
in the interplay of labour demand and supply and Demographically induced labour shortages have
in worker remuneration will lead to differences in been compounded by health-related increases
labour market outcomes. in inactivity rates. According to estimates by the
World Health Organization (WHO), approximately
Labour supply 20 per cent of those infected by COVID-19 will
suffer from some form of longer-term health con-
The global LFPR is estimated to have recovered sequence (Cox 2021; Stulpin 2022; Van Beusekom
to close to 60 per cent in 2022, slightly below its 2022). Estimates of the impact on labour supply
level in 2019. It is projected to continue its long- vary; studies for the United States suggest that
term downward trend through 2023, declining by 300,000–600,000 workers (Sheiner and Salwati
0.2 percentage points till 2024. In total, around 2022) or even 2–4 million people (Bach 2022) have
3.6 billion people are estimated to have been been out of work because of long COVID. These
part of the labour force in 2022, a figure that is figures represent a range of between 0.2 and
projected to increase by around 35 million per year 2.2 per cent of the labour force.
thanks to the growth of the working-age popu- Maintaining or raising standards of living in a
lation. Economic inactivity, meaning not being context of rising old-age dependency ratios will
in the labour force, can result from positive but require faster productivity growth, increased
also negative factors. The long-term decline in LFPR, or inward migration of young workers.
the LFPR is to some degree driven by the younger This is because, on average, every worker will need
generation spending more time in education and to produce ever more output, since that output
the older generation enjoying longer periods of will need to be sufficient for ever more people who
retirement – achievements made possible by are not economically active.17 Old-age dependency
economic development. However, economic in- ratios – defined as the ratio of the population aged
activity also arises from a lack of labour market 65 and above to the population aged 15 to 64 –
16 “Brown” refers to tasks and activities that inhibit environmental protection, further unsustainable solutions or have a large
negative impact on the environment (Bohnenberger 2022).
17 Rising labour productivity growth is only a necessary condition to maintain standards of living when there is an ageing popu-
lation. Equally important is the redistribution of incomes – meaning the design of pension systems – to allow everyone to actually
experience this standard of living.
X Figure 1.5. Old-age dependency ratio and labour force participation rate (percentages)
of people aged 25–64, 1991–2021, world and by country income group
82
2001
1991
80
2021
Labour force participation rate (ages 25–64)
2001
1991 2011
78 2011 2021 2001
2021 2011
2001
76
2011
1991
1991
74
2021
72
70
2001
2011
68
1991
66
2021
64
0 0.1 0.2 0.3
Old-age dependency ratio
World Low-income countries Lower-middle-income countries

Upper-middle-income countries High-income countries
Note:The old-age dependency ratio is the ratio of those aged 65 and above to those aged 25–64.
Source:World Population Prospects 2022 of UN Population Division; ILOSTAT, ILO modelled estimates,
November 2022.
have risen significantly over the past decade in in LFPR to compensate. Moreover, despite being
high-income countries and also in upper-middle- a long-standing policy objective, lifelong-learning
income countries (figure 1.5). Chapter 3 shows policies have been introduced only sparingly, given
that labour productivity growth has in fact slowed the high opportunity costs of retraining for older
down over the past decade, thereby threatening workers. Experience acquired over one’s working
the ability to maintain the average standard life is often not fully reflected when a worker tran-
of living. sitions to a different occupation or sector, such
that they may lose a significant portion of their
Anticipating these trends, several countries
seniority-linked wage premium (McKinsey 2022).
have long undertaken measures to increase
Finally, more effort could be made to bring more
participation rates. In many high-income coun-
women and marginalized groups into the labour
tries, retirement age limits have been raised and
market through appropriate policies.
incentives for older workers to remain employed
have been increased. In these countries, rising Employers in countries with ageing popula-
LFPRs among those aged 25 to 64, as well as tions will face a shrinking labour force – and
increased participation by those aged 65 and hence a dwindling pool of talent – as raising
above, have balanced to some degree the falling participation rates further becomes ever more
productivity growth, thereby maintaining the difficult. The LFPR of those aged 25 to 64 in high-
potential growth of GDP per capita (figure 1.5). income countries is already 7 percentage points
However, there is a limit to how much such policies above the global average, and further increases
can contribute to overcoming structural shortages will face limits. The labour force is projected to
in labour supply. In simple terms of numbers, the shrink in 2024 in high-income countries. In 2022,
old-age dependency ratio is rising too fast for a rise three quarters of surveyed companies reported
X Figure 1.6. Labour force participation rate, 2022, by sex, world and by subregion
(percentages)
World 47.4 72.3

North Africa 19.8 67.5
Sub-Saharan Africa 62.2 72.9
Latin America and the Caribbean 51.0 74.3
North America 56.9 67.7
Arab States 19.2 76.0
East Asia 60.2 72.5
South-East Asia 54.8 77.2
South Asia 24.8 74.5
Pacific 59.2 66.9
Northern, Southern and Western Europe 53.4 64.0
Eastern Europe 52.0 67.1
Central and Western Asia 48.5 64.3
0 50 100
Women Men
Source:ILOSTAT, ILO modelled estimates, November 2022.
having difficulties finding the talent needed to fill 30 million per year until 2024, mostly as a result of
positions (ManpowerGroup 2022). young people entering the labour market. Africa
is projected to account for almost half of the
Globally, in 2022, the number of working-age
global labour force expansion (16 million workers
women outside the labour force surpassed
per year) while accounting for only a fifth of the
that of men by 750 million – a consequence of
global labour force. The large number of young
women’s LFPR being 24.9 percentage points
people projected to enter the labour market poses
below that of men (figure 1.6). Gender gaps in its own challenges, since young people face par-
LFPR, though a global phenomenon, occur highly ticular difficulties in this process.19
unequally across the world; in areas such as North
Africa, the Arab States and South Asia, women are In 2022, more than one in five of young people
only a third as likely as men to be economically aged 15 to 24 were NEET. This amounts to
active. Deep structural barriers in these areas, 289 million young people who were deprived
often rooted in social norms, hinder women’s par- of opportunity to obtain valuable skills through
ticipation in labour markets (ILO 2019b; 2017b).18 early work experience or some form of training
or education (ILO 2022f). Young women are twice
Low-income and lower-middle-income countries as likely as young men to be NEET, which means
benefit from low old-age dependency ratios that gender gaps in terms of LFPR are likely to
but face the challenge of integrating a large perpetuate. Indeed, regions with large gender
youth population into the labour market. Those participation gaps also show large gender gaps
two country income groups are projected to see in NEET, which underlines the need for trans-
their combined labour force increase by around formative policy approaches to resolve gender
18 These factors may include discrimination, fragmented and segregated labour markets, the unequal distribution of unpaid
care work and care responsibilities between men and women and between families and the State, gender-based violence and
harassment, prevailing gender stereotypes and socio-cultural norms, and the limited voice and representation of women in
collective decision-making processes.
19 Many African youth entering the labour market are located in rural areas (ILO 2022a).
X Figure 1.7. Youth aged 15–24 not in employment, education, or training, 2022,
by sex, world and by subregion (percentages)
Women Total Men

World 32.1 23.5 15.4
North Africa 39.0 28.0 17.3
Sub-Saharan Africa 31.4 25.7 20.1
Latin America and the Caribbean 26.9 20.3 13.9
North America 11.6 11.3 11.0
Arab States 47.2 32.9 19.5
East Asia 18.5 15.6 13.1
South-East Asia 21.8 18.3 14.9
South Asia 49.5 31.7 15.3
Pacific 19.0 17.4 16.0
Northern, Southern and Western Europe 9.7 9.8 9.9
Eastern Europe 14.3 12.4 10.5
Central and Western Asia 27.5 22.0 16.8
inequalities and prevent their perpetuation profitable employment and also those who are
across generations. It is encouraging, though, not currently available to take up employment.
that gender gaps in NEET rates have fallen over (See “The jobs gap, beyond unemployment”
the past 16 years: NEET rates of young women below for an extensive analysis of this unmet
have fallen by 2 percentage points whereas NEET demand for employment.) Unlocking this potential
rates of young men have slightly increased. There could raise labour supply and thereby alleviate
are large variations in NEET rates across regions, labour shortages.
which are partly explained by the gender gaps
and partly by the difficulties young people face
in entering the labour market. For instance, just Quantity of work: Employment
over 10 per cent of young European men are NEET, and working hours
versus almost 20 per cent of young men in the
Arab States (figure 1.7). Aside from those NEET, Determinants of employment growth differ
many young people are economically inactive across country income groups. First, the macro-
because they are pursuing an education (ILO economic outlook differs across countries; some
2022f). The LFPR of young people was around countries are projected to enter a recession
40 per cent in 2022, much lower than that of whereas others are likely to see a normalization
adults. Thanks to the increasing ability of young of growth after the higher growth rates of 2021
people to pursue an extended education, particu- and 2022. Second, institutions differ widely across
larly in middle-income countries, that figure has countries, including in coverage of social protection
come down significantly, having stood at around systems, extent of social bargaining, employment
56 per cent three decades ago. protection legislation and government labour
market policies. Third, countries are at different
In 2022, around 268 million people were not
stages of demographic change.
in the labour force but were nevertheless
interested in obtaining employment. This In low-income and lower-middle-income
group includes workers who are discouraged countries, employment reacts only modestly
because they don’t see any possibility of obtaining to swings in economic activity, since most
X Figure 1.8. Job vacancies (standard deviations from mean), June 2001 to September 2022
2.5
2.0
1.5
1.0
0.5
–0.5
–1.0
–1.5
2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 2022
75th percentile Median 25th percentile
Note:The figure shows the median and the 25th and 75th percentiles of the three-month rolling average
of standardized job vacancy postings across 18 (mostly advanced) economies. Countries covered: Austria,
Cyprus, Czechia, Estonia, Finland, France, Germany, Japan, New Zealand, Poland, Portugal, Slovenia, Spain,
Sweden, Switzerland, Thailand, United Kingdom of Great Britain and Northern Ireland, United States.
Source:Tradingeconomics.
workers are informal and/or self-employed. In consumption, thereby supporting employment

the absence of social protection systems, workers growth. However, higher revenues arising
in the informal economy continue with some type from the terms-of-trade boost are likely to be
of – survival – economic activity. In these coun- concentrated among fewer households, whereas
tries, employment growth is strongly driven by the rising cost of living affects everybody. In the
the number of people who reach working age. absence of appropriate government intervention
Equally, unemployment does not react very much. this state of affairs will increase inequality, which
On the other hand, incomes will react to an eco- could have a depressing effect on employment
nomic downturn, as will, to some degree, hours growth and aggregate demand.
worked, especially for employees without fixed
In high-income countries with ageing popula-
jobs (for example, day labourers).
tions, employment evolution is also determined
In upper-middle-income countries the situation by more medium-term strategic decisions by
is more complex. One of them, China, accounts firms that need to balance laying off workers
for the majority of workers in this income group during a downturn against the risk of labour
and will likely face much lower economic growth shortages during the recovery. Job vacancies
than in the past while its strategy to handle in a sample of 18 mostly high-income countries
COVID-19 is reducing working hours and while have seen a steep decline since June 2022, but in
investment excesses – in particular in the real September 2022 were still at historically high levels
estate sector – are being corrected (Pettis (figure 1.8). Vacancies fluctuate with the business
2022). However, the government is determined cycle and hence are expected to decline further
to maintain growth and will likely apply many as firms stop expanding their workforce. However,
levers to avoid a large impact on the labour companies will need to balance the short-term
market. Quite a few other upper-middle-income need for profitability – and in some cases sur-
countries are net commodity exporters that vival – with the medium-term challenge to obtain
have benefited from a large terms-of-trade and maintain talented staff. This raises the likeli-
boost from the commodity price boom. This hood that companies operating in countries with
may bolster government finances and domestic ageing populations will resort to labour hoarding
X Figure 1.9. Average annual employment growth, 2010–24,

world and by country income group (percentages)
2010–19 2020–21 2022 2023 2024
World 1.1 0.2 2.3 1.0 1.1
Low-income countries 2.8 2.4 3.7 3.3 3.3
Lower-middle-income countries 1.6 0.4 3.0 1.8 1.8
Upper-middle-income countries 0.5 0.0 1.2 0.1 0.3
(excluding China) 1.2 –0.6 3.3 0.7 0.8
High-income countries 1.1 –0.6 2.7 0.2 –0.1
Source:Author’s calculations based on ILOSTAT, ILO modelled estimates, November 2022.
during an economic downturn, avoiding lay-offs growth in high-income countries was positive in
of staff they fought so hard to attract throughout 2022 only because of strong employment growth in
2021 and 2022. the first half of the year. The projected (unweighted)
average employment growth in 2023 with respect
Many firms may lack the resources to main-
to the third quarter of 2022 is essentially zero in
tain staff, especially ones already hit hard
those high-income countries with available quar-
by the COVID-19 crisis and ones with higher
terly data, and employment growth in high-income
financing costs. Small and medium-sized
countries is projected to continue to be close to
enterprises in particular may not be able to
zero in 2024.20 All other country income groups
survive a large reduction in aggregate demand.
are projected to see employment growth in 2024
Insolvencies may rise, especially given the fact that
similar to that in 2023.
a substantial insolvency backlog probably exists
after two years of exceptionally low numbers of The multiple crises hitting the world of work
insolvencies (Allianz Research 2022). Nevertheless, have caused projected employment growth in
numbers of insolvencies are projected to remain 2023 to be 0.5 percentage points below what
moderate, and not surpass their pre-pandemic was projected in the previous edition of this
level, thanks to continued state support (Allianz report one year ago (figure 1.10). This slowdown
Research 2022). Consequently, employment will significantly delay the recovery of employment
losses in high-income countries in the next losses incurred during the COVID-19 crisis in those
two years will be limited relative to the extent of countries where gaps persist. The downward re-
economic downturn. vision is relatively small in lower-middle-income
countries; it is largest in the Americas. In the latter
Global employment is projected to expand by
region, though, employment recovery in 2022 was
1.0 per cent in 2023, a marked deceleration
very strong, capturing some of the recovery that
following 2.3 per cent growth in 2022 (figure 1.9).
was previously expected to occur in 2023.
There is a significant dichotomy between country
income groups: employment in low-income and Employment growth is hardly sufficient to
lower-middle-income countries is projected to match the growth of the working-age popu-
expand at rates seen before 2020, but upper- lation, causing a stabilization of employment-
middle-income and high-income countries will see to-population ratios (EPRs) across all country
much slower employment growth. Employment income groups. The global EPR reached 56.4 per cent
20 Quarterly employment data are available for 37 high-income countries.

X Figure 1.10. Revision to employment growth projection in 2023, world,

country income groups and regions (percentage points)
World −0.5
Low-income countries −0.6
Lower-middle-income countries −0.3
−0.6
High-income countries
−0.8
Africa
−0.6
Americas
−1.3
Arab States
−0.5
Asia and the Pacific −0.3
Europe and Central Asia −0.6
–2 0 2 4
WESO Trends 2023 WESO Trends 2022
Source:ILOSTAT, ILO modelled estimates, November 2022; ILO modelled estimates, November 2021.
in 2022, a strong improvement on the low of past three years, they nevertheless remain less
54.5 per cent in 2020, but still half a percentage point likely than men to be in employment. Similarly
below the rate in 2019 (table 1.1). The EPR gap in 2022 to the LFPR, the gender gap in the global EPR
relative to the pre-crisis level was 0.7 percentage stands at 23.5 percentage points, with a regional
points in low-income countries, whereas high-income pattern similar to that shown in figure 1.7. The
countries managed to exceed the pre-crisis EPR, employment outlook for men and women is fairly
which highlights the large divergence in recovery similar: employment growth for both men and
that took place. The EPR is projected to fall slightly women is projected to slow down at roughly the
in 2023 and 2024. same pace.
Women experienced a much stronger Youth employment has been hit particularly
employment recovery than men, their EPRs hard during the pandemic and its recovery re-
approaching the rates of 2019. This stronger remains far behind that of adults (ILO 2022f). In
covery was mainly driven by informal employment, 2022 the global EPR of young people aged 15 to 24
though; four out of five jobs created for women in was 34.5 per cent, 0.7 percentage points below
2022 were informal, versus only two out of three the level of 2019. For adults, the gap was 0.5 per-
for men. In high-income countries, women’s EPR centage points. Since the EPR of young people
was up by half a percentage point in 2022 com- is much lower than that of adults, the relative
pared with 2019, versus a decline of 0.3 percentage shortfall is also much larger for youth – almost
point for men. Lower-middle-income countries 2 per cent, versus 0.7 per cent for adults. Gender
have had a similar experience, women’s EPR gaps in employment rates are equally present
having largely recovered while men’s EPR has among young people, highlighting the strong
remained 0.9 percentage points below the 2019 persistence of the factors that drive gender gaps
level. Women in low-income and upper-middle- (ILO 2017b, 2019b and 2022f). Young workers also
income countries have similar employment deficits have different types of jobs from older workers,
relative to 2019 as men. Despite the improved including a higher likelihood of a temporary con-
labour market developments for women over the tract (ILO 2022g and 2022f).
X Table 1.1. Employment and employment-to-population ratio, 2019–24,

by sex, world and by country income group
Country group Sex EPR (percentages) Employment (millions)
2019 2020 2021 2022 2023 2024 2019 2020 2021 2022 2023 2024
World Total 56.9 54.5 55.7 56.4 56.3 56.1 3273 3176 3283 3359 3393 3430
Women 45.0 43.0 44.0 44.7 44.5 44.4 1299 1256 1301 1335 1347 1360
Men 68.8 66.1 67.5 68.2 68.1 68.0 1974 1920 1982 2024 2046 2070
Low-income Total 62.0 60.7 61.0 61.3 61.4 61.4 242 245 254 263 272 281
countries
Women 53.1 51.8 52.2 52.1 52.1 52.1 105 106 110 113 117 121
Men 71.2 69.8 70.1 70.8 70.9 71.0 137 139 144 150 155 160
Lower-middle- Total 52.0 49.8 50.6 51.4 51.5 51.6 1205 1174 1213 1249 1272 1296
income countries
Women 33.7 32.3 32.8 33.5 33.6 33.7 388 378 390 405 413 421
Men 69.9 67.1 68.2 69.0 69.2 69.2 816 796 823 845 859 875
Upper-middle- Total 61.0 58.0 60.1 60.4 60.0 59.8 1225 1173 1223 1237 1239 1243
income countries
Women 53.2 50.4 52.3 52.7 52.4 52.1 539 514 537 545 545 546
Men 68.8 65.7 67.9 68.1 67.8 67.6 686 659 685 692 694 696
High-income Total 58.1 56.3 57.0 58.2 57.9 57.7 602 585 594 610 611 610
countries
Women 51.0 49.3 50.2 51.4 51.1 50.9 267 259 264 272 273 272
Men 65.4 63.3 63.9 65.1 64.8 64.6 335 326 329 338 338 338
Total hours worked recovered less well from worked indicates a high degree of time-related
the COVID-19 crisis than did employment: hours underemployment, which also depresses labour
worked per worker have persistently declined. incomes and raises the risk of poverty. High labour
Whereas in 2019 the average weekly hours per productivity allows workers in high-income coun-
worker, globally, was slightly above 42 hours, tries to work relatively few weekly hours while
the figure was only 41.4 hours per week in 2022 maintaining a good income. Contrastingly, workers
(figure 1.11). The decline is most significant in in middle-income-countries worked more than
lower-middle-income countries (minus 1 hour 42 hours per week on average in 2022.
per week), but also sizeable in low-income and
Globally, women in employment work around
high-income countries (about minus 0.5 hours
seven paid hours per week less than men, with
per week). This decline in hours will have reduced
large variations of that gender gap by region
income per worker where workers have been
(figure 1.12). The fewer hours that women spend
unable to raise their hourly earnings. Weekly hours
in paid employment compound the already large
worked per worker are projected to decline in all
gender gaps in employment rates. The unequal
country income groups, with the largest decline
burden of unpaid work that falls on women hence
(of 0.4 hours per week) in high-income countries.
impacts not only their participation in the labour
The low level of hours worked per worker in market but also their hours of work when they
low-income countries is directly related to the are employed. Interestingly, women in South Asia
lack of decent work opportunities. Although and Central and Western Asia – both subregions
the EPR is the highest among all the country with large gender gaps in employment rates – do
income groups, the low average number of hours not work very low hours in global comparison.
X Figure 1.11. Weekly hours worked per employed person, 2010–24,

world and by country income group
45
44
43
42
41
40
39
38
37
36
35
34
2010 2012 2014 2016 2018 2020 2022 2024
Upper-middle-income countries Lower-middle-income countries World

Upper-middle-income countries (excluding China) High-income countries Low-income countries
X Figure 1.12. Weekly hours worked per employed person, 2022, by sex,
world and by subregion
World 37.3 44.1

North Africa 36.3 43.0
Sub-Saharan Africa 34.6 38.7
Latin America and the Caribbean 35.9 42.1
North America 32.5 37.8
Arab States 33.9 45.3
East Asia 43.4 46.4
South-East Asia 38.9 40.6
49.7
South Asia 34.2
30.4
Pacific 37.2
Northern, Southern and Western Europe 32.3 39.0
Eastern Europe 34.0 36.8
Central and Western Asia 33.2 47.9
30 35 40 45 50
Women Men

X Table 1.2. Weekly hours worked relative to the fourth quarter of 2019,
percentages and FTE, 2020–24, world and by country income group
Weekly hours worked (population FTE (at 48 hours per week) of difference
adjusted) relative to Q4 2019 in weekly hours worked (population
(percentages) adjusted) relative to Q4 2019
(millions)
Country group 2020 2021 2022 2023 2024 2020 2021 2022 2023 2024
World –8.7 –3.6 –1.4 –1.6 –1.3 –252.2 –106.3 –41.4 –47.2 –37.8
Low-income countries –5.9 –4.6 –2.1 –2.1 –1.4 –10.9 –8.8 –4.2 –4.2 –2.9
Lower-middle-income countries –11.2 –6.4 –2.7 –2.6 –2.1 –125.3 –72.1 –30.6 –30.2 –24.3
Upper-middle-income countries –7.1 –0.8 –0.3 –0.5 –0.4 –80.2 –8.5 –3.6 –5.4 –4.6
High-income countries –7.6 –3.6 –0.6 –1.6 –1.3 –35.8 –16.9 –2.9 –7.4 –6.0
Note: Q4 2019 = fourth quarter of 2019.

However, men in these two regions have the Unemployment

highest numbers of weekly hours, hence large
gender gaps in terms of hours as well. Global unemployment declined significantly in
2022 to 205 million, down from 235 million in
Hours worked per worker declined massively
2020 but still 13 million above the level of 2019.
in 2020. One of the defining features of the
The unemployment rate, standing at 5.8 per cent
COVID-19 crisis with its workplace closures was the
in 2022, was still above its 2019 rate (table 1.3).
relatively limited impact on employment despite
High-income countries have experienced con-
the significant decline in work activity. Total hours
siderable progress in reducing unemployment,
worked, which track the level of work activity in an
the rate having declined to 4.5 per cent in 2022,
economy, declined by almost 9 per cent relative
even lower than the 4.8 per cent of 2019. Whereas
to the fourth quarter of 2019 when adjusted for
upper-middle-income countries have managed to
population growth (table 1.2). In line with the in-
recuperate to the unemployment rate of 2019, both
complete employment recovery and lower hours
low-income and lower-middle-income countries
worked per worker, total hours worked (adjusted
still face rates that exceed the pre-crisis levels by
for population) in 2022 were 1.4 per cent lower than
more than half a percentage point.
their level in the fourth quarter of 2019; this gap
corresponds to the equivalent of 41 million full-time Global unemployment is projected to edge up
jobs.21 The recovery of losses in working hours slightly in 2023, by around 3 million. The relatively
is highly unequal across the world; low-income modest projected increase in unemployment
and lower-middle-income countries were still in despite the negative global economic outlook
2022 experiencing much larger gaps relative to the arises from the multiple country-specific factors
fourth quarter of 2019 (ILO 2022c). The gaps are presented above that also limit employment losses.
projected to widen further in 2023 at the global Enterprises in high-income countries that face
level, albeit only marginally, and then to narrow labour shortages amidst an ageing population
in 2024, to around 1.3 per cent globally. will resort to labour hoarding where possible.22
The economic outlook in low-income and
21 The tenth ILO Monitor on the World of Work (ILO 2022c) presents a shortfall in working hours equivalent to 40 million full-time
jobs for the first three quarters of 2022.
22 Many high-income countries are likely to support enterprises to hold on to workers through employment retention schemes
that have been used during the pandemic.
X Table 1.3. Unemployment and unemployment rate, 2019–24,

by sex, world and by country income group
Country group Sex Unemployment rate Unemployment

(percentages) (millions)
2019 2020 2021 2022 2023 2024 2019 2020 2021 2022 2023 2024
World Total 5.5 6.9 6.2 5.8 5.8 5.8 191.9 235.2 216.4 205.2 208.2 210.9
Women 5.6 6.7 6.2 5.8 5.8 5.9 77.3 90.3 86.5 81.9 83.5 84.7
Men 5.5 7.0 6.1 5.7 5.7 5.7 114.7 144.9 129.9 123.3 124.7 126.3
Low-income Total 5.2 5.9 5.8 5.8 5.7 5.7 13.1 15.4 15.7 16.1 16.5 16.9
countries
Women 5.4 6.1 6.1 6.0 6.0 6.0 6.0 6.9 7.2 7.3 7.5 7.7
Men 5.0 5.7 5.6 5.5 5.5 5.4 7.2 8.4 8.6 8.8 9.0 9.2
Lower-middle- Total 5.5 7.4 6.4 6.2 6.1 6.2 70.1 93.8 82.8 82.0 83.3 85.3
income countries
Women 5.6 6.8 6.3 6.2 6.2 6.2 22.9 27.7 26.2 26.7 27.3 28.0
Men 5.5 7.7 6.4 6.2 6.1 6.1 47.2 66.1 56.5 55.4 56.1 57.3
Upper-middle- Total 6.0 6.8 6.3 6.0 5.8 5.8 78.6 85.3 82.6 78.4 76.9 77.0
income countries
Women 6.0 6.6 6.4 5.9 5.8 5.8 34.3 36.5 36.7 34.3 33.8 33.9
Men 6.1 6.9 6.3 6.0 5.9 5.8 44.3 48.8 46.0 44.1 43.1 43.1
High-income Total 4.8 6.5 5.6 4.5 4.9 5.0 30.1 40.7 35.2 28.7 31.5 31.8
countries
Women 5.0 6.9 5.9 4.8 5.2 5.3 14.1 19.2 16.5 13.7 14.9 15.1
Men 4.5 6.2 5.4 4.3 4.7 4.7 15.9 21.5 18.8 15.1 16.6 16.7
Source: ILOSTAT, ILO modelled estimates, November 2022.
lower-middle-income countries is not very negative more likely to exit the labour market following
compared with pre-crisis trends. Moreover, these job loss, partly because of increased burdens of
countries have historically had less elasticity of unpaid care work. By 2022, the gender gap in
unemployment in response to economic growth. the unemployment rate was close to its level in
Unemployment rates are projected to remain 2019, since stronger employment recovery among
relatively stable across country income groups women came along with a recovery of women’s
except the high-income group. labour force participation. Women and men are
projected to experience similar changes in un-
Women in the labour market are marginally
employment rates in 2023 and 2024.
more likely than men to be unemployed; their
unemployment rate was 5.8 per cent in 2022, Young people in the labour force are three
0.1 percentage points above that of men. Women times as likely as adults to be unemployed,
also experience greater labour underutilization, the global youth unemployment rate being
globally and across all country income groups (see about 14 per cent in 2022. This translates into
“The jobs gap, beyond unemployment” below). 69 million young people who were looking for a
In 2020, women’s unemployment rate increased job but unable to find one.23 Youth unemployment
much less than men’s because they were much rates are highest in upper-middle-income countries
23 In addition to looking for a job, people also need to be available for employment if they are to be defined as unemployed.
X Figure 1.13. Youth unemployment rates, 2019 and 2022, world and country income groups
(percentages)
World
Low-income countries
Lower-middle-income countries
(excluding China)
0 5 10 15 20
2019 2022
Note:“Youth” refers to ages 15–24.

excluding China, at 17 per cent in 2022, and lowest The jobs gap, beyond
in low-income countries, at 9 per cent (figure 1.13).
Youth unemployment rates also exhibit great re- unemployment
gional variation (ILO 2022f). Youth unemployment
Unemployment is the best-known but also
rates are still higher globally than in 2019 but have
one of the most restrictive measures of
fallen in high-income and upper-middle-income
labour underutilization. To be considered un-
countries excluding China. Global youth un-
employed, people need to be available to take up
employment is projected to increase by 1 million
employment at short notice and to have recently
between 2022 and 2023 and to remain roughly
been searching for a job (ICLS 2018). Although this
stable in 2024. The figure of 289 million young
metric is a highly informative measure of labour
people who are NEET (see figure 1.7) highlights
underutilization, indicating those who are jobless
the fact that youth unemployment is only one of
and placing immediate pressure on the labour
multiple problems faced by young people in the
market, a vast number of people do not fulfil those
labour market.
conditions yet nevertheless have an interest in
finding employment. The total unmet need for
employment is far larger than what unemployment
numbers alone can capture. A novel ILO data set
shows the magnitude of this extended conception
of labour underutilization.24
24 The new estimates follow guidance from the 19th ICLS. The resolution concerning statistics of work, employment and labour
underutilization provides operational concepts, definitions and guidelines for measures of labour underutilization (ICLS 2018). The
main measures of labour underutilization highlighted in the resolution are time-related underemployment, unemployment and
the potential labour force. An additional group of interest in the measurement of labour underutilization whom the resolution
identified are willing non-jobseekers. This group evinces a lower degree of labour market attachment than those in the potential
labour force, but they are nonetheless relevant to social and gender analysis, as acknowledged in the resolution. The new ILO data
set on the jobs gap complements the existing set of indicators in the ILO modelled estimates by providing combined estimates of
the potential labour force and willing non-jobseekers. Hence, the estimates include those who have recently been searching for a
job but are not available to work within a short reference period, those who have not recently searched for a job but are available
to work within a short reference period, and those who fall into neither of the previous categories but do want employment.
X Figure 1.14. Unemployment rate and jobs gap, 2022, by gender

and country income group (percentages)
20 20.4
15
14.9
13.2
10 11.5
10.5
8.4
5 5.8 5.7 5.8 6.2 6.0

4.5
0
Women Men Low-income Lower-middle- Upper-middle- High-income
World countries income countries income countries countries
Unemployment rate Jobs gap
In 2022, around 473 million people were jobs gap rate for women is 15.0 per cent compared
interested in finding a job but did not have with 10.5 per cent for men (figure 1.14). In other
one. This unmet demand for jobs includes the words, an additional 153 million women are iden-
205 million unemployed people and an additional tified as having an unmet need for employment,
268 million who wanted employment but did not when we apply this wider focus, compared with
qualify as unemployed. The latter group includes, 115 million men. Personal and family responsi-
for instance, workers who are discouraged from bilities, including unpaid care work, can prevent
searching because they see no possibility of many people from seeking employment or limit
obtaining employment and also those currently their availability to work at short notice. Such lim-
unable to take up employment at short notice, iting factors disproportionately affect women and
such as those with family responsibilities and thus explain the large gap in this broader measure
full-time students. The jobs gap is a new indicator of labour underutilization. The difference between
that captures the entirety of unmet demand for the broader jobs gap and unemployment is also
employment – 473 million – and provides a much disproportionately large in the developing world.
better representation of labour underutilization Two factors are likely to be driving this. First, a high
than does unemployment alone. incidence of informality can reduce the prospects
Globally, the jobs gap rate was 12.3 per cent in of finding employment, discouraging those who
2022, well above the global unemployment rate desire employment from searching. Second, avail-
of 5.8 per cent.25 This jobs gap is particularly large ability to start a job at short notice can be more
for women. Globally, men and women experienced constrained in developing countries by a greater
a similar unemployment rate in 2022. However, the amount of time being spent on household tasks
25 The incidence rate of labour underutilization, including willing non-jobseekers, is defined as analogous to the combined rate of
unemployment and potential labour force used in the 19th ICLS. The additional jobs gap is defined as the sum of the potential
labour force and willing non-jobseekers divided by the sum of the extended labour force and willing non-jobseekers. Using
the latest available estimates of the potential labour force (ILO modelled estimates, November 2021), it can be inferred that in
2019 the potential labour force accounted for approximately 40 per cent of the additional jobs gap; the remainder comprised
those wanting employment but neither available nor seeking it.
that cannot be characterized as employment.26 the jobs gap. Low-income and lower-middle income
Regardless of the mechanism, the estimates point countries have very high jobs gaps, of 20 and
to a much higher jobs gap than unemployment 13 per cent, respectively, whereas upper-middle-
rate in developing countries. Whereas there are no income countries present a gap of 11 per cent
strong differences between country income groups and high-income countries register a gap of only
in unemployment rates, striking differences arise in 8 per cent (figure 1.14).
XWorkers are likely to face deteriorating

working conditions
Beyond the size of the jobs gap, job quality re- the inflation of the cost of living or inputs, and
mains a key concern. Many people simply cannot hence experience real income losses. On the flip
afford to be without a job, owing to their poverty side, some workers and enterprises experience
and lack of access to social protection. They will income gains (far) higher than the inflation rate,
undertake any kind of activity, often at very low and their real incomes therefore increase. This
pay, sometimes with insufficient hours. A shortage causes a shift in real incomes in the economy.
of better job opportunities in the context of the
Global labour incomes are distributed highly un-
projected slowdown will push workers into jobs of
equally across the world, the bottom 50 per cent
worse quality. Furthermore, as prices rise faster
earning only 7.8 per cent of global labour
than nominal labour incomes, many workers will be
income in 2019, the last year with available
unable to maintain their real income. Both factors
estimates. A large part of this inequality is driven
imply deteriorating labour market conditions in
by differences in average standards of living across
dimensions other than employment.
countries, rather than by inequality within coun-
tries (ILO 2020). The unweighted average share
Work incomes and inequality of labour income across all countries that went to
the bottom 50 per cent in 2019 was 17.2 per cent.
Inflation, especially when driven by rising
Low- and middle-income households are more
commodity prices, has a strong impact on
vulnerable to inflation owing to the composition
income distribution. Rising prices of inputs and
of their income, asset and consumption baskets
final goods and services stretch the budgets of
(Gill and Nagle 2022).
enterprises and households needing to purchase
them, but they also raise the revenues earned by Global labour income inequality has declined
sellers. Total real income is affected by the chan- since 2005, mainly thanks to the economic
nels through which inflation affects real activity, convergence of middle-income countries (ILO
and real GDP estimates show that real income 2020). The share of labour incomes earned by
continued to grow in most countries of the world the top 20 per cent of workers declined from
in 2022. This, however, does not mean that inflation 76.6 per cent in 2010 to 67.3 per cent in 2019.
has no effect on households’ real incomes. First, Meanwhile, significant income growth has accrued
depending on the terms-of-trade effect of rising among the lower strata of global income distribu-
commodity prices, countries may experience a tion (Milanovic 2022). However, the global labour
fall in national disposable income because they income share declined from 54.1 per cent in 2004
need to spend more on imports. Second, and more to 52.6 per cent in 2019. The decline in this time
importantly, many workers and enterprises are period is part of a longer-term decline in those
unable to raise their income or revenue in line with countries with available data (ILO 2020).
26 See, for instance, https://www.researchgate.net/publication/304636246_Time-Use_Surveys_in_Developing_Countries_An_

Assessment.
X Box 1.1. Food price explosion causes rise in food insecurity

The world is facing the largest food crisis in modern history. Recent estimates from 79 countries
where the World Food Programme (WFP) is present indicate that 349 million people faced acute
food insecurity in 2022 – that is, these people’s inability to consume adequate food was putting
their life and/or livelihood in immediate danger (WFP 2022). Over the course of the COVID-19 crisis,
and exacerbated by the Ukraine conflict, the number of people facing acute food insecurity has
increased by 200 million. Global estimates show that in 2021 between 702 and 828 million people
experienced hunger or the prevalence of undernourishment, an increase of 150 million from 2019
(FAO et al. 2022). Hunger and food insecurity are driven by high food prices arising from economic
factors, active conflicts that directly hinder or prevent agricultural activity, and weather-related dis-
ruptions that are only going to become worse and more frequent with climate change (WFP 2022).
Average real wages fell in 2022, meaning that The impact of current inflation on extreme working
wage and salaried workers are unable to raise poverty is heterogeneous, since 65 per cent of the
their incomes in line with inflation (ILO 2022e). extremely poor work in agriculture (Castañeda et
This decline is reducing the purchasing power of al. 2018) and hence may also benefit from rising
the middle class and hitting low-income groups incomes owing to higher food prices, which may
particularly hard and comes on top of substan- even lift some of them out of poverty.28 At the same
tial losses in the total wage receipts for workers time, millions of people live and work in rural areas
and their families during the COVID-19 crisis. The where agricultural productivity is insufficient, and
decline in real wages in 2022 is estimated to have thus rely on purchased food; hence a significant
been most severe in advanced economies, at increase in food insecurity in 2022 (box 1.1).
2.2 per cent. Emerging economies, on the other
In 2022 an estimated 214 million workers were
hand, experienced reduced but positive wage
living in extreme poverty, corresponding to
growth of 0.8 per cent.
around 6.4 per cent of the world’s employed
Falling real incomes are particularly devastating (table 1.4). The substantial decline by 14 million
for poorer households, who risk slipping into workers since 2020 is a consequence of the lifting
poverty and food insecurity. The higher share of of workplace closures.29 Worryingly, however, in
food and transportation in the budget of poorer 2022 low-income countries are estimated to have
households means that the cost-of-living increase had the same rate of extreme working poverty
among low-income households can be between as in 2019. This stagnation following some prom-
1 and 4 percentage points higher than that faced ising progress in the preceding decades does
by high-income ones (ILO 2022e). The World Bank not bode well for the achievement of Sustainable
estimates that in a pessimistic scenario, in which Development Goal (SDG) 1: the eradication of
the impact of high food prices falls mainly on the poverty in all its forms. The number of working
bottom 40 per cent of the income distribution, poor is even increasing in low-income countries,
20 million more people around the world were in ex- since too much of the expansion of employment
treme poverty in 2022 than in the baseline scenario is in subsistence agriculture and other informal
of equal impact across the income distribution.27 activities with low pay.
27 Retrieved from https://www.worldbank.org/en/topic/poverty on 13 October 2022.

28 Among the working poor, a substantial part of food production is for one’s own consumption, which would hence be “budget
neutral” regardless of the world market price.
29 South Asian and South-East Asian countries in particular experienced significant workplace closures in 2021.
X Table 1.4. Extreme working poverty, 2000–22, world and by country income group
Country group Share of extreme working poverty Extreme working poverty

(≤ US$1.90 PPP per day) (≤ US$1.90 PPP per day)
2000 2010 2019 2020 2021 2022 2000 2010 2019 2020 2021 2022
World 25.8 13.7 6.7 7.2 6.7 6.4 666.9 405.9 218.8 228.3 220.6 214.3
Low-income 56.9 45.6 38.3 38.8 38.5 38.6 81.3 86.2 92.7 95.0 97.7 101.6
countries
Lower-middle- 35.5 20.2 9.6 10.4 9.3 8.2 308.1 213.1 115.6 122.5 112.6 102.2
income countries
Upper-middle- 25.9 9.1 0.8 0.9 0.8 0.8 277.2 106.5 10.4 10.6 10.1 10.3
income countries
The changing composition points between 2004 and 2019, with a slowdown
in the pace of the decline towards the end of the
of employment growth period (figure 1.15). In 2020 informal workers
were disproportionately affected by lockdowns
Security in the workplace and social protection
and public health restrictions. This was mainly
for all, better prospects for personal develop-
because informal workers were over-represented
ment and social integration, and the freedom
in microenterprises and small enterprises. 30
of people to express their concerns, organize,
Moreover, informal workers had more limited
and participate in the decisions that affect their
access to support measures such as job retention
lives are just as important to achieving social
programmes and flexible working arrangements.
justice as are opportunities for productive work
Informality trends have differed markedly by
that delivers a fair income. Consequently, the
gender. Informally employed women experienced
type of employment that workers have is very
disproportionally large job losses, which drove
important and will be investigated in this section.
down the incidence rate of informality among
Informality lacks many characteristics of the women during 2020, whereas in the same period
formal employment relationship that are the incidence of informality increased among
important to the advancing of social justice. men. This evidence strongly supports the view
Informal workers are engaged in economic activ- that care demands coupled with informal workers’
ities that are either insufficiently covered or not lack of access to telework, flexible hours or leave
covered at all by formal arrangements in law or in resulted in a disproportionate job destruction rate
practice. These workers, and also businesses run by for women in informal employment (ILO 2018b and
informal employers, tend to lack legal recognition, 2018c; World Bank 2020; IMF 2020; UN Women
to fail to comply with fiscal obligations, and to face 2020; İlkkaracan and Memiş 2021).
difficulties in entering into commercial contracts.
A recovery from the pandemic is driven by
Moreover, informal workers are much more likely
informal jobs. As countries lifted lockdowns
to be living in conditions of poverty (ILO 2018b).
and public health restrictions and economies
Globally, around 2 billion workers were in recovered, informal jobs rebounded faster than
informal employment in 2022. Informality had formal ones. Hence the slow but steady reduction
been trending downwards over the last decade in informality, sustained for more than a decade,
and a half, global rates falling by 5 percentage has come to a halt. Around two thirds of the job
30 See, for instance, ILO (2021e) for an analysis of the differential impact of the pandemic upon firms by firm size.
X Figure 1.15. Index of informal employment incidence, 2004–22, by sex (2004 = 100)
100
98
96
94
92
90
88
2004 2006 2008 2010 2012 2014 2016 2018 2020 2022
Men Total Women
gains between 2020 and 2022 were in informal their supply chains after observing vulnerabilities
employment; thus the incidence of informality in to supply disruption during the COVID-19 crisis and
2022 was slightly higher than in 2019. The growth geopolitical shifts (Kearney 2021; Maihold 2022).
of informal employment has been particularly These short-term adjustments of supply chains
strong for women (ILO 2022c). The scarcity of data, are underpinned by a longer-term trend of slowing
particularly during the COVID-19 crisis and the globalization (see “Risks to the outlook” below).
recovery, means that such trends must be carefully
GSCs linked to high-income countries are an
interpreted; nonetheless, this development is par-
important source of employment in middle-
ticularly worrying, since it points to a deterioration
income countries. In a sample of 24 middle-
in an area where progress was already modest.
income countries, the share of employment in
Moreover, if the economic environment were to
activities, excluding agriculture and non-market
deteriorate further than currently anticipated, the
services,32 that are related to GSCs linked to high-
upward trend of informality could be prolonged
income countries was 11.3 per cent in 2021, down
over the medium term.
from 13.7 per cent in 2000 (box 1.2). In 5 of the
The projected economic slowdown in high- 24 middle-income countries, this share is greater
income countries is likely to have important than 20 per cent. The share of employment related
spillovers for low- and middle-income countries to GSC linkages with other middle-income countries
through GSC linkages. Growth in imports by ad- was 8.9 per cent. Whereas large economies have
vanced economies is projected to decline from an a large internal market, employment in smaller
average rate of 3.5 per cent in the period 2015–19 economies tends to be much more reliant on GSCs.
to only 2 per cent in 2023.31 As a consequence, GSC The slowdown in high-income countries could
activities linked to these economies could lose im- therefore cause a shift of employment creation in
portance as a source of employment growth among middle-income countries towards activities that are
developing and emerging economies. This trend not linked through GSCs to high-income countries.
could be reinforced by companies reorganizing Those activities could include more involvement
31 Calculation based on IMF World Economic Outlook Databases, October 2022.

32 Non-market services include public administration, education, health services, and community, social and other services and
activities. See https://ilostat.ilo.org/resources/concepts-and-definitions/description-labour-force-statistics/.
X Box 1.2. Accounting for GSC-related jobs

In this chapter the estimates characterizing jobs connected to GSCs are based on the input–output
methodology (see Appendix D for details and country coverage). This methodology allows one
to track with the help of inter-country input–output tables the shares of output produced by an
economic activity which at some point in the supply chain cross international borders. Those
shares are then translated into numbers of jobs, both the total for the economy and by certain
characteristics. The analysis here presents only jobs in non-agricultural activities because GSC-
related agricultural businesses likely exhibit very different employment characteristics from those
of other agricultural businesses, and at the time of writing no robust estimates of these differences
exist. In other economic activities the differences are likely to be smaller – for instance, the same
companies are involved in GSCs linked to high-income countries and in other supply chains – and
so the estimates are less sensitive to the underlying assumptions (see Appendix D). Non-market
services have by nature very little exposure to GSCs and hence are excluded from the analysis.
The analysis in figure 1.16 presents sectoral composition effects, showing the weighted incidence
of employment characteristics – that is, whether sectors with higher GSC-related jobs shares have,
on average, a higher or lower incidence of a certain employment characteristic than the rest of
the economy. The figure can be interpreted as showing the incidence of a particular characteristic
in GSC-related activities only if one makes the assumption that, within each sector, GSC-related
activities have the same incidence of a characteristic as activities that are not GSC related. This
assumption is unlikely to hold. For example, there is ample evidence that exporting firms tend
to pay higher wages than non-exporting firms (Milner and Tandrayen 2007; Melitz and Redding
2014). Furthermore, rates of formality and wage employment are also likely to be higher among
exporters than non-exporters. Consequently, the incidence of wage employment in GSC-related
activities shown in figure 1.14 is likely to be underestimated and the incidence of informality and
low pay to be overestimated.
of intra-regional supply chains, but also activities than non-market services would likely cause
unrelated to GSCs. The following analysis assumes working conditions to deteriorate. The prob-
that intra-regional supply chains are not fully able ability that a worker is informal or self-employed
to replace job creation in the short run, which is significantly lower in sectors with a high share
results in jobs shifting towards activities unrelated of GSC-related activities linked to high-income
to GSCs.33 The analysis looks at the characteristics countries than is the probability in other activ-
of employment outside non-market services, since ities (excluding non-market services) (figure 1.16).
these very often depend on allocated government Contrastingly, in middle-income countries the
budgets and hence will not be a viable alternative share of high-skilled workers is lower in GSC-
for overall job creation unless governments raise intensive sectors linked to high-income countries
budget allocations. Shifts of employment out of than in the remainder of the economy – a result of
GSC-related activities to other economic activities middle-income countries mainly playing the role
will have consequences for the composition of of the world’s manufacturing workshop, given
employment in terms of factors such as gender, that most occupations typically found in manufac-
age, status, formality and pay.
turing are not classified as requiring high skill.
A shift of employment growth in middle-income Furthermore, the share of employees with low
countries from GSC activities linked to high- pay – defined as those earning less than two thirds
income countries towards alternatives other of the median – is slightly lower in GSC-intensive
33 This assumption can be motivated on several grounds. For instance, consumers in high-income countries have a large spending
power that is unlikely to be fully replaced by that of consumers in middle-income countries, especially during an economic
slowdown.
X Figure 1.16. Weighted incidence of employment characteristic in middle-income countries,

activities relating to GSCs linked to high-income countries, and all activities, 2019 (percentages)
66.9
Share of wage and salaried employees
56.5
15.3
Share of high-skilled workers
19.6
46.8
Share of informal workers
75.0
9.4
Share of low-paid employees
10.0
42.0
Share of women
44.2
14.2
Share of youth
14.1
Activities, excluding agriculture and non-market services, All other activities except non-market services
relating to GSCs linked to high-income countries
Note:Weights are given by that sector’s employment share in total employment, or by that sector’s share of
GSC-related employment in total GSC-related employment. For both cases, “total” excludes non-market services;
“total” also excludes agriculture for GSC-related employment. The data cover 24 middle-income countries, mostly
in Asia. Non-market services excluded from the figure are public administration, health and social services,
education, arts and recreation. “High-skilled” refers to occupations requiring high skill. “Youth” refers to ages
15–24. “Low-paid” is defined as earning less than two thirds of median monthly income.
Source:ILO estimates based on Asian Development Bank (ADB) multi-region input–output tables; see box 1.2.
activities. Importantly, though, “low pay” here only increasing labour productivity (Blanas, Huynh and
refers to employees; a shift to non-GSC-related ac- Viegelahn, forthcoming).
tivities greatly raises the chances of becoming an
Reductions in spending and public employment
own-account or contributing family worker – and
in emerging and developing countries would
such individuals face a much higher risk of working diminish average employment quality.
poverty than do employees (Huynh and Kapsos Countries might be forced into such a reduction
2013). The employment shares of women are in spending should their financing conditions
slightly lower (and those of youth essentially the worsen as a result of spillovers from monetary
same) in sectors with a high share of GSC-related tightening; major spending cuts may arise in
activities than in middle-income countries overall, the case of a full-blown debt crisis. Workers in
indicating that a shift of employment growth from economic activities that depend rather strongly
GSC-related activities to other activities would not on public expenditure – public administration,
place a disproportionate burden on either women education, health and social services – are much
or youth.34 Further analysis conducted for South- more likely to be employees, high skilled and
East Asia that goes beyond simple comparison formal and are much less likely to be low paid
of averages demonstrates an important positive (figure 1.17). Consequently, average job quality
effect of forward and backward linkages in global would decline if countries were to engage in large
value chains on reducing working poverty and public spending cuts.
34 In South-East Asia, women and youth are slightly over-represented in GSC-related activities relative to the rest of the economy
(ADB and ILO, forthcoming).
X Figure 1.17. Share of type of workers by economic activities, 2021,

by country income group (percentages)
Wage and
salaried High-skilled Informal Employees
Low-income countries workers workers workers with low pay Women
All other activities 13 3 92 56 44

Public administration, education,
87 62 47 14 40
health and social services

91 67 30 19 44

96 58 12 4 58
Note:“Low pay” refers to earning less than two thirds of the median monthly wage.
Source:ILO estimates.
X Risks to the outlook
The labour market outlook presented in this measures to avoid further distortions,35 thereby
report has significant downside risks. For one putting under threat the support measures that
thing, global economic growth has a significant households and businesses require to navigate
risk of falling below 2 per cent for a multitude of the crisis. In low- and middle-income countries,
reasons: policy mistakes in terms of monetary there is risk that economic growth may not be very
tightening, dollar strength, persisting inflationary inclusive and that this, coupled with rising food
forces, widespread debt distress in vulnerable and energy prices, may leave a large proportion of
emerging markets, a halting of gas supplies to households with lower disposable income. This in
Europe, a resurgence of global health scares turn will reduce demand for many locally produced
and a further slowdown of China’s economic goods and services, likely causing a reduction in
growth (IMF 2022). Lower economic growth and at least formal employment growth.
aggregate demand will also affect employment Slowing globalization is limiting decent work
creation negatively. However, labour market pro- opportunities in low- and middle-income coun-
spects could turn out more negative even without tries. The emergence of a global middle class
those threats materializing. Businesses may be and the notable reduction in working poverty
unable to hold on to workers should financing over the last two decades were supported by a
conditions worsen significantly, causing a major continued integration of international markets and
rise in unemployment that will further depress the integration of frontier markets in GSCs. This
growth. Sovereign bond interest rates may rise dynamic was already slowing down, however, after
to levels that force governments into austerity the global financial crisis of 2009. As geopolitical
35 Debt sustainability is one problem. Pension funds as large holders of government bonds may face solvency problems if bond
prices decline too much.
X Figure 1.18. Evolution of economic, financial and social globalization, 1970–2022
65 75
70
60
65
55
60
50
55
45
50
40
45
35 40
1970 1980 1990 2000 2010 2020 1970 1980 1990 2000 2010 2020
KOF Globalisation Index KOF Social Globalisation Index
KOF Trade Globalisation Index KOF Interpersonal Globalisation Index
KOF Financial Globalisation Index KOF Informational Globalisation Index
Source:KOF Globalisation Index: https://kof.ethz.ch/en/forecasts-and-indicators/indicators/kof-globalisation-index.html.
tensions rise, there is a risk of retrenchment of the expected acceleration. Despite the impressive
supply chains and the possibility of a reversal in the growth and profitability of leading companies in
progress of decent work creation (see figure 1.18). the digital economy, their innovations have failed,
In addition to re- or near-shoring certain high-end so far, to lead to an acceleration in productivity
activities in or closer to advanced economies, more broadly, since diffusing them has proved to
the quest for multiple suppliers to strengthen be challenging. The barriers to diffusion lie partly
supply chain resilience is likely to increase costs in the substantial role of intangible assets in the
and undo part of the benefits gained from glo- business model, so that benefits are reaped by
balization over previous decades. Although this only a few companies (Bessen 2022; Ernst 2022).
may have only limited effects on employment, Changes in the regulatory environment together
it will add to cost pressures, keeping inflation with accelerated investment in people’s skills will
rates above levels observed previously. However, be necessary to enable a broader diffusion of the
“friend-shoring” will provide opportunities for benefits of digital innovation across all sectors of
countries that manage to present themselves as the economy.
a reliable partner.
Global uncertainty remains elevated amidst
Headwinds in productivity trends may further a multitude of risks, depressing investment
limit progress in living standards and real and job creation. A ratcheting of uncertainty has
wages. Productivity growth remains disappoint- been observed over the last 15 years, starting
ingly low, both in advanced economies and in major with the global financial crisis and exacerbated
emerging countries. Part of the productivity slow- by the COVID-19 pandemic and the Ukraine
down in frontier markets was to be expected as conflict. Major crises such as financial or health
further potential gains from structural adjustment crises often trigger further disruptions because
diminished. However, even at the technological of the knock-on effect they have on the social
frontier, productivity growth has not experienced fabric (Tooze 2022). In particular, unless supported
by strong policy action, economies often fail to incomes cause social unrest and political instability
recover the output lost and, worse, will settle on (Vlandas and Halikiopoulou 2022). Such socio-
a less dynamic path of economic development economic crises are self-reinforcing, creating long
(Cerra and Saxena 2008). Shattered expectations spells of economic and political instability that
and heightened conflict about the distribution of demand major overhaul and a new social contract.
XRenewing the social contract

and advancing social justice
The global economy has undergone no fewer than The ILO’s Constitution reminds us that social
five major crises with global repercussions over justice is a precondition for lasting peace. Its
the last 25 years. Geopolitical tensions, financial Preamble states that “conditions of labour exist
crises and a global pandemic have diminished involving such injustice, hardship and privation
confidence in the ability of national policymakers to large numbers of people as to produce unrest
and the multilateral system to respond to societies’ so great that the peace and harmony of the world
most pressing needs. are imperilled”. Founded in 1919 in the aftermath
of a world war, a global pandemic and pervasive
A more human-centred policy approach is
industrial and social unrest, the ILO was given a
required to strengthen the resilience of econ-
mission to promote the improvement of those
omies and societies – to advance social justice
conditions of labour for the purpose of justice and
amidst the major economic shifts and shocks
humanity and to ensure permanent peace in the
under way. This needs to include strengthening
world. Although there is no single authoritative
labour and social protection to insure workers
definition of social justice, a broad consensus exists
and their families against various forms of risk
among the ILO’s constituents about the central
as well as expanding education and vocational
importance of decent work, including respect for
training to help workers to transition to alternative
fundamental principles and rights at work, pro-
sectors or occupations. Large educational gaps
ductive and freely chosen employment, universal
exist, producing significant barriers to structural
social protection, and social dialogue as a means of
transformation and productivity upgrading (see
shaping economic progress that benefits everyone.
Chapter 3). Stronger implementation of the
The labour market trends presented in this chapter
human-centred approach framed by the ILO’s
underscore the ongoing critical importance of this
2019 Centenary Declaration and 2021 Global Call
agenda for all societies.
to Action is needed to strengthen national social
contracts and advance global social justice at a time
when they are under increased pressure.
References
X ADB (Asian Development Bank) and ILO. Forthcoming. ASEAN and Global Value Chains: Locking in
Resilience and Sustainability.
X Allianz Research. 2022. “Insolvency Report 2022”, 18 May 2022. https://www.allianz-trade.com/
en_global/news-insights/news/insolvency-report-2022.html.
X Bach, Katie. 2022. “New Data Shows Long Covid Is Keeping as Many as 4 Million People out of
Work”. Brookings, 24 August 2022. https://www.brookings.edu/research/new-data-shows-long-
covid-is-keeping-as-many-as-4-million-people-out-of-work/.
X Barga, João Paulo. 2022. “Greening Macroeconomic Policies: Current Trends and Policy
Options”, ILO Policy Brief. https://www.ilo.org/wcmsp5/groups/public/---ed_emp/---emp_ent/
documents/publication/wcms_863317.pdf.
X Bessen, James. 2022. The New Goliaths. New Haven, CT: Yale University Press.
X Blanas, Soteris, Phu Huynh, and Christian Viegelahn. Forthcoming. “Is Deeper Global Value
Chain Integration Linked to More Inclusive Labour Markets in South-East Asia?” A Global
Comparative Analysis”, ILO Working Paper.
X Bohnenberger, Katharina. 2022. “Is it a Green or Brown Job? A Taxonomy of Sustainable
Employment”. Ecological Economics 200: 107469.
X Carolina Feijao, Isabel, Christian van Stolk Flanagan, and Salil Gunashekar. 2021. The Global
Digital Skills Gap: Current Trends and Future Directions. RAND Corporation. https://doi.org/10.7249/
RRA1533-1.
X Castañeda, Andrés, Dung Doan, David Newhouse, Minh Cong Nguyen, Hiroki Uematsu, and
João Pedro Azevedo. 2018. “A New Profile of the Global Poor”. World Development 101 (January):
250–267. https://doi.org/10.1016/j.worlddev.2017.08.002.
X Cerra, Valerie, and Sweta Chaman Saxena. 2008. “Growth Dynamics: The Myth of Economic
Recovery”. American Economic Review 98 (1): 439–457.
X Cox, Tracy. 2021. “How Many People Get ‘Long COVID?‘ More than Half, Researchers Find“.
PennState, 13 October 2021. https://www.psu.edu/news/research/story/how-many-people-get-
long-covid-more-half-researchers-find/.
X DESTATIS (Federal Statistical Office of Germany). 2022. “Zusammenhang zwischen
Materialknappheit und Industrieaktivität”. Statistisches Bundesamt. https://www.destatis.de/
DE/Themen/Branchen-Unternehmen/Industrie-Verarbeitendes-Gewerbe/materialknappheit-
industrieaktivitaet.html.
X ECB (European Central Bank). 2022. “Update on Economic, Financial and Monetary
Developments”, Economic Bulletin No. 3. https://www.ecb.europa.eu/pub/economic-bulletin/
html/eb202203.en.html.
X Ernst, Ekkehard. 2020. “The Return of the Fourth Horseman: How the Current Pandemic Might
Re-shape Our World”. Medium, 30 March 2020. https://medium.com/@ekkehard_ernst/the-return-
of-the-fourth-horseman-how-the-current-pandemic-might-re-shape-our-world-4f82d7f8eac4.
X ———. 2022. “The AI Trilemma: Saving the Planet without Ruining Our Jobs”. Frontiers in Artificial
Intelligence 5 (October). https://doi.org/10.3389/frai.2022.886561.
X FAO (Food and Agriculture Organization), IFAD (International Fund for Agricultural
Development), UNICEF (United Nations Children’s Fund), WFP (World Food Programme), and
WHO (World Health Organization). 2022. The State of Food Security and Nutrition in the World
2022: Repurposing Food and Agricultural Policies to Make Healthy Diets More Affordable. https://doi.
org/10.4060/cc0639en.
X Federal Reserve Bank of New York. 2022. “Global Supply Chain Pressure Index”.
X Gill, Indermit, and Peter Nagle. 2022. “Inflation Could Wreak Vengeance on the World’s Poor”.
Brookings, 18 March 2022. https://www.brookings.edu/blog/future-development/2022/03/18/
inflation-could-wreak-vengeance-on-the-worlds-poor/.
X Global Alliance for Improved Nutrition. 2022. Challenges Facing Small- and Medium-Sized
Enterprises in the Food System: Results of an Online Survey. https://sunbusinessnetwork.org/wp-
content/uploads/2022/09/SBN-SME-Survey-2022-Results-Final.pdf.
X Guénette, Justin Damien, M. Ayhan Kose, and Naotaka Sugawara. 2022. “Is a Global Recession
Imminent?” Equitable Growth, Finance and Institutions Policy Note No. 4.
X Huynh, Phu, and Steven Kapsos. 2013. “Economic Class and Labour Market Inclusion: Poor and
Middle Class Workers in Developing Asia and the Pacific”, ILO Working Paper, 7 August 2013.
X ICLS (International Conference of Labour Statisticians). 2018. Resolution concerning statistics
of work, employment and labour underutilization. http://www.ilo.ch/wcmsp5/groups/public/---
dgreports/---stat/documents/normativeinstrument/wcms_230304.pdf.
X İlkkaracan, İpek, and Emel Memiş. 2021. “Transformations in the Gender Gaps in Paid and
Unpaid Work during the COVID-19 Pandemic: Findings from Turkey”. Feminist Economics 27 (1–2):
288–309.
X ILO. 2017a. “Trends in Collective Bargaining Coverage: Stability, Erosion or Decline?” ILO
Issue Brief No. 1. https://www.ilo.org/wcmsp5/groups/public/---ed_protect/---protrav/---travail/
X ———. 2017b. World Employment and Social Outlook: Trends for Women 2017. https://www.ilo.org/
global/research/global-reports/weso/trends-for-women2017/lang--en/index.htm.
X ———. 2018a. World Employment and Social Outlook 2018: Greening with Jobs. https://www.ilo.org/
global/publications/books/WCMS_628654/lang--en/index.htm.
X ———. 2018b. Women and Men in the Informal Economy: A Statistical Picture, 3rd ed. https://www.
ilo.org/wcmsp5/groups/public/---dgreports/---dcomm/documents/publication/wcms_626831.pdf.
X ———. 2018c. Care Work and Care Jobs for the Future of Decent Work. https://www.ilo.org/global/
publications/books/WCMS_633135/lang--en/index.htm.
X ———. 2019a. Working on a Warmer Planet: The Impact of Heat Stress on Labour Productivity
and Decent Work. https://www.ilo.org/wcmsp5/groups/public/---dgreports/---dcomm/---publ/
X ———. 2019b. A Quantum Leap for Gender Equality: For a Better Future of Work for All. https://www.
ilo.org/global/publications/books/WCMS_674831/lang--en/index.htm.
X ———. 2020. World Employment and Social Outlook: Trends 2020. https://www.ilo.org/global/
research/global-reports/weso/2020/lang--en/index.htm.
X ———. 2021a. World Social Protection Report 2020–22: Social Protection at the Crossroads – in
Pursuit of a Better Future. https://www.ilo.org/global/publications/books/WCMS_817572/lang--en/
index.htm.
X ———. 2021b. Child Labour: Global Estimates 2020, Trends and the Road Forward. https://www.ilo.
org/ipec/Informationresources/WCMS_797515/lang--en/index.htm.
X ———. 2021c. World Employment and Social Outlook: Trends 2021. https://www.ilo.org/global/
research/global-reports/weso/trends2021/WCMS_795453/lang--en/index.htm.
X ———. 2021d. Changing Demand for Skills in Digital Economies and Societies: Literature Review and
Case Studies from Low- and Middle-Income Countries. https://www.ilo.org/skills/areas/skills-training-
for-poverty-reduction/WCMS_831372/lang--en/index.htm.
X ———. 2021e. ILO Monitor: COVID-19 and the World of Work. Eighth Edition. Updated Estimates
and Analysis. https://www.ilo.org/wcmsp5/groups/public/---dgreports/---dcomm/documents/
briefingnote/wcms_824092.pdf.
X ———. 2022a. “Advancing Social Justice and Decent Work in Rural Economies”, ILO Policy Brief.
https://www.ilo.org/wcmsp5/groups/public/---ed_dialogue/---sector/documents/briefingnote/
wcms_858195.pdf.
X ———. 2022b. Global Estimates of Modern Slavery: Forced Labour and Forced Marriage. https://doi.
org/10.54394/CHUI5986.
X ———. 2022c. ILO Monitor on the World of Work. 10th Edition. Multiple Crises Threaten the Global
Labour Market Recovery. https://www.ilo.org/wcmsp5/groups/public/---dgreports/---dcomm/---
publ/documents/briefingnote/wcms_859255.pdf.
X ———. 2022d. Care at Work: Investing in Care Leave and Services for a More Gender Equal World of
Work. https://www.ilo.org/global/topics/care-economy/WCMS_838653/lang--en/index.htm.
X ———. 2022e. Global Wage Report 2022–23: The Impact of Inflation and COVID-19 on Wages and
Purchasing Power. https://www.ilo.org/global/research/global-reports/WCMS_862569/lang--en/
index.htm.
X ———. 2022f. Global Employment Trends for Youth 2022: Investing in Transforming Futures for
Young People. https://www.ilo.org/global/publications/books/WCMS_853321/lang--en/index.htm.
X ———. 2022g. World Employment and Social Outlook: Trends 2022. https://www.ilo.org/global/
X ———. 2022h. Social Dialogue Report 2022: Collective Bargaining for an Inclusive, Sustainable and
Resilient Recovery. https://www.ilo.org/wcmsp5/groups/public/---dgreports/---dcomm/---publ/
X IMF (International Monetary Fund). 2020. “Who Will Bear the Brunt of Lockdown Policies?
Evidence from Tele-workability Measures across Countries”, IMF Working Paper. https://www.
imf.org/en/Publications/WP/Issues/2020/06/12/Who-will-Bear-the-Brunt-of-Lockdown-Policies-
Evidence-from-Tele-workability-Measures-Across-49479.
X ———. 2022. World Economic Outlook: Countering the Cost-of-Living Crisis. https://www.imf.org/
en/Publications/WEO/Issues/2022/10/11/world-economic-outlook-october-2022.
X IPCC (Intergovernmental Panel on Climate Change). 2018. Global Warming of 1.5°C: An IPCC
Special Report on the Impacts of Global Warming of 1.5°C above Pre-industrial Levels and Related
Global Greenhouse Gas Emission Pathways, in the Context of Strengthening the Global Response to the
Threat of Climate Change, Sustainable Development, and Efforts to Eradicate Poverty. Cambridge and
New York, NY: Cambridge University Press.
X Kearney. 2021. The Tides Are Turning: 2021 Reshoring Index. https://www.kearney.com/consumer-
retail/article/-/insights/the-2021-reshoring-index-the-tides-are-turning#:~:text=Our%20latest%20
Reshoring%20Index%20is,Manufacturing%20Import%20Ratio%20(MIR).
X Macallan, Clare, Stephen Millard, and Miles Ian Parker. 2008. “The Cyclicality of Mark-ups and
Profit Margins for the United Kingdom: Some New Evidence”, Bank of England Working Paper
No. 351. https://doi.org/10.2139/ssrn.1280900.
X Maihold, Günther. 2022. “A New Geopolitics of Supply Chains: The Rise of Friend-Shoring”, SWP
Comment 2022/C 45. https://www.swp-berlin.org/en/publication/a-new-geopolitics-of-supply-
chains.
X ManpowerGroup. 2022. “The 2022 Global Talent Shortage”. https://go.manpowergroup.com/
hubfs/Talent%20Shortage%202022/MPG-Talent-Shortage-Infographic-2022.pdf.
X McKinsey. 2022. “Human Capital at Work: The Value of Experience”, 2 June 2022. https://www.
mckinsey.com/capabilities/people-and-organizational-performance/our-insights/human-capital-
at-work-the-value-of-experience.
X Melitz, Marc J., and Stephen J. Redding. 2014. “Heterogeneous Firms and Trade”. In Handbook
of International Economics, edited by Gita Gopinath, Elhanan Helpman and Kenneth Rogoff, Vol. 4,
1–54. Amsterdam: Elsevier.
X Milanovic, Branko. 2022. “The Three Eras of Global Inequality, 1820–2020 with the Focus on the
Past Thirty Years”. SocArXiv Papers. https://doi.org/10.31235/osf.io/yg2h9.
X Milner, Chris, and Verena Tandrayen. 2007. “The Impact of Exporting and Export Destination on
Manufacturing Wages: Evidence for Sub-Saharan Africa”. Review of Development Economics 11 (1):
13–30.
X Obstfeld, Maurice. 2022. “Uncoordinated Monetary Policies Risk a Historic Global Slowdown”.
Peterson Institute for International Economics, 12 September 2022. https://www.piie.com/blogs/
realtime-economic-issues-watch/uncoordinated-monetary-policies-risk-historic-global-slowdown.
X OECD (Organisation for Economic Co-operation and Development). 2020. “Coronavirus: The
World Economy at Risk”. OECD Economic Outlook, 2 March 2020. https://read.oecd-ilibrary.org/
economics/oecd-economic-outlook/volume-2019/issue-2_7969896b-en#page1.
X Pereira da Silva, Luiz Awazu, Enisse Kharroubi, Emanuel Kohlscheen, Marco Lombardi, and
Benoît Mojon. 2022. Inequality Hysteresis and the Effectiveness of Macroeconomic Stabilisation
Policies. Bank for International Settlements (BIS).
X Pettis, Michael. 2022. “China’s Overextended Real Estate Sector Is a Systemic Problem”. China
Financial Markets, 24 August 2022. https://carnegieendowment.org/chinafinancialmarkets/87751.
X Rees, Dan, and Phurichai Rungcharoenkitkul. 2021. “Bottlenecks: Causes and Macroeconomic
Implications”, BIS Bulletin No. 48. https://www.bis.org/publ/bisbull48.pdf.
X Sheiner, Louise, and Nasiha Salwati. 2022. “How Much Is Long COVID Reducing Labor Force
Participation? Not Much (So Far)”, Hutchins Center Working Paper No. 80. https://www.brookings.
edu/wp-content/uploads/2022/10/WP80-Sheiner-Salwati_10.27.pdf.
X Stulpin, Caitlyn. 2022. “Global Prevalence of Long COVID ‘Substantial,’ Researchers Say”. Healio,
1 May 2022. https://www.healio.com/news/infectious-disease/20220425/global-prevalence-of-
long-covid-substantial-researchers-say.
X Tooze, Adam. 2022. “Chartbook #165: Polycrisis – Thinking on the Tightrope”, Chartbook,
29 October 2022. https://adamtooze.substack.com/p/chartbook-165-polycrisis-thinking.
X UNCTAD (United Nations Conference on Trade and Development). 2022. Trade and Development
Report 2022. Development Prospects in a Fractured World: Global Disorder and Regional Responses.
https://unctad.org/system/files/official-document/tdr2022_en.pdf.
X UN Women. 2020. Unlocking the Lockdown: The Gendered Effects of COVID-19 on Achieving the
SDGs in Asia and the Pacific. https://data.unwomen.org/sites/default/files/documents/COVID19/
Unlocking_the_lockdown_UNWomen_2020.pdf.
X Van Beusekom, Mary. 2022. “Global Data Reveal Half May Have Long COVID 4 Months on”.
CIDRAP News, 18 April 2022. https://www.cidrap.umn.edu/global-data-reveal-half-may-have-long-
covid-4-months.
X Visser, Jelle. 2012. “The Rise and Fall of Industrial Unionism”. Transfer: European Review of Labour
and Research 18 (2): 129–141. https://doi.org/10.1177/1024258912439160.
X Vlandas, Tim, and Daphne Halikiopoulou. 2022. “Welfare State Policies and Far Right Party
Support: Moderating ‘Insecurity Effects’ among Different Social Groups”. West European Politics 45
(1): 24–49.
X Way, Rupert, Matthew C. Ives, Penny Mealy, and J. Doyne Farmer. 2022. “Empirically Grounded
Technology Forecasts and the Energy Transition”. Joule 6 (9): 2057–2082. https://doi.org/10.1016/j.
joule.2022.08.009.
X WFP (World Food Programme). 2022. WFP Global Operational Response Plan 2022: Update #6.
https://www.wfp.org/publications/wfp-global-operational-response-plan-update-6-
november-2022.
X World Bank. 2020. “Who on Earth Can Work from Home?” Working Paper. https://
openknowledge.worldbank.org/handle/10986/34277#:~:text=The%20ability%20to%20
telework%20is,lagging%20regions%2C%20and%20poor%20workers.
2
X Overview
Employment
and social trends
by region
Decent work deficits vary by region in magnitude, yet are

widespread, undermining social justice across all regions. In
the Arab States, North Africa and South Asia, gender gaps in labour
market indicators, including the LFPR, continue to prevail; in Latin
America and the Caribbean, and in sub-Saharan Africa, elevated
rates of informality inhibit access to social protection and funda-
mental rights at work. Such circumstances are not limited to these
or any particular regions, but affect all regions to different degrees,
and global economic conditions are likely to reverse progress and
worsen these problems. Rising costs of living and inflation, in
particular, threaten to worsen working poverty and reduce the
ability of workers and their households to earn enough to sustain
themselves above the poverty line. In sub-Saharan Africa and
South Asia, 60.8 per cent and 34.4 per cent, respectively, of the
employed population in 2021 were considered to be working poor
at the US$3.10 per day (2011 PPP per capita) level.1
1 In 2022, the World Bank revised the threshold for extreme poverty from
US$1.90 per day in 2011 PPP to US$2.15 per day in 2015 PPP. This change could
not yet be taken into account in the production of estimates for this report, but it
will be taken into account in future editions.
Headline labour market indicators showed spillover effects from this mean that the outlook
improvements in 2022 from a year earlier, for 2023 remains highly volatile and uncertain.
despite a slowdown in GDP growth. Elevated prices and cost of living are likely to
Employment growth is estimated to have impair livelihoods and aggregate demand, with
remained positive for the whole year, albeit implications for the labour market.
at slower pace in the Americas, and in Asia
The labour market outlook for 2023 varies
and the Pacific than was seen in 2021 (see
considerably by region. Employment growth
Chapter 1). In the Arab States, employment
for 2023 is expected to remain in positive ter-
growth is expected to have grown faster than
ritory despite slowing from a year earlier, with
in 2021 owing to higher commodity prices in
significant variations by region. Africa and the
the first half of 2022. The global unemployment
Arab States should see employment growth
rate fell in 2022 by 0.4 percentage points to
of the order of 3 per cent or more. However,
reach 5.8 per cent, and declines in the un-
both regions, with growing working-age popu-
employment rate were experienced in all
lations, will see unemployment rates remain
regions. Nonetheless, beneath the surface of
relatively unchanged (at around 7.1 per cent in
these headline labour market indicators, there
Africa and 9.1 per cent in the Arab States). In
are signs that decent work deficits have wors-
Asia and the Pacific, and in Latin America and
ened in many regions, including in relation to
the Caribbean, annual employment growth will
informality in Latin America and the Caribbean
be less than 1 per cent. In North America, and
and poor-quality jobs in Asia and the Pacific.
in Europe and Central Asia, there will be slightly
The outlook for 2023 remains volatile and positive or negative employment growth in
uncertain as inflation persists and the con- 2023, but unemployment rates should hold
flict in Ukraine continues. Inflation continues steady against the backdrop of limited growth
to wreak havoc across the globe and, with in the working-age population. Indeed, in
central banks raising interest rates to levels Europe and Central Asia, the labour force is
last seen before the global financial crisis, set to decline in 2023. Despite these trends in
the risk of a global recession has heightened headline labour market indicators, each region
considerably. The risk is particularly acute in will continue to face a myriad of decent work
advanced economies, where growth is set to deficits that are likely to worsen with global eco-
slow to 1.4 per cent (IMF 2022a). Moreover, the nomic conditions and in the face of long-term
continuation of the conflict in Ukraine and the challenges like climate change (see Chapter 1).
X Africa
Africa saw a strong rebound in 2021, with employment, underemployment and working
4.7 per cent annual GDP growth, after an poverty characterize the region’s labour market,
annual contraction of 2.2 per cent in 2020. especially in rural areas. Comparably robust
Annual growth for the region, however, slowed economic growth rates are failing to significantly
to around 3.5 per cent in 2022 and is expected reduce inequalities in the region, which worsened
to be 3.9 per cent in 2023 (IMF 2022b). Although during the pandemic. The challenge is that the
growth has recovered to a rate in line with histor- deterioration in growth at the end of 2022 has
ical averages, the slowdown suggests that to get come on the tail end of the pandemic and at a
back to pre-pandemic output will take longer, with time when fiscal space is already weakened by
implications for productivity and standard of living, the pandemic’s impact and when public debt is
among other things. Any improvement in the global rising in many African economies (IMF 2022c).
economic situation in 2023 would be expected to The lack of fiscal space is also likely in 2023 to
support higher growth in Africa in 2023 (World become a pivotal factor that will undermine the
Bank 2022a). Yet, as elsewhere in the world, there ability of governments to respond to shocks and
are significant and increasing inflation-related risks support those workers in poor-quality forms of
as a result of ongoing supply chain constraints and employment. This raises the spectre that debt relief
the conflict in Ukraine (World Bank 2022b). and other support measures may be required from
the international community.
Several emerging factors pose risks to growth
in the region; a number of countries are con- P o p ul a t i o n gr ow t h ha s un d e r p inn e d
fronted with significant downward revision employment gains in recent years but has in-
of growth projections. Severe effects of the tensified decent work deficits. Total employment
COVID-19 pandemic are still impacting economic in Africa is estimated to reach 511 million in 2023,
growth, particularly following a relatively slow having increased by 3.6 per cent per annum from
vaccination roll-out. At least 30 million people 2021 to 2023. This follows 2.0 per cent employment
in Africa were forced into extreme poverty as a growth per annum between 2019 and 2021. The
result of the pandemic and this trend continues strong employment gains in Africa have largely
(AfDB 2022). In around half of Africa’s economies, been driven by working-age population growth
per capita incomes are expected to remain below in the sub-Saharan Africa subregion but have
pre-pandemic levels by the end of 2023 (World tended to be associated with fewer hours worked
Bank 2022b). Underlying structural risks relating per person and higher rates of informality and
to policy uncertainty, social unrest and violence other poorer-quality forms of employment. Africa’s
are also hampering a fuller economic recovery total informal employment rate increased from
in some countries (IMF 2022c). The ILO’s social 84.3 per cent in 2019 to 85.0 per cent in 2022.
unrest indicator identifies 22 countries (of 55 in
In Africa, employment elasticities of growth
the region) that saw an increase in social unrest
vary across countries, with implications for
between 2021 and 2022. The effects of climate
the labour market recovery. In a number of
change continue to affect sub-Saharan Africa
African countries, there is a weak association
disproportionately, reducing regional GDP by an
between GDP growth and employment growth,
estimated 5 to 15 per cent per year (AfDB 2022).
in part owing to different degrees of reliance on
This is a large and increasing barrier to sustainable
resource exports (ILO 2022a). Alongside rapid
growth and is increasing already high levels of food
population growth, this means that the economic
insecurity (World Bank 2022c).
recovery observed in the region is not necessarily
Structural decent work deficits in the region associated with equivalent developments in
continue to weigh on Africa’s ability to achieve employment growth, as can be observed in the
inclusive growth. Elevated rates of informal following subsections.
Labour market trends of 4 million in total employment, from 65 million

in 2019 to 69 million in 2022. Employment growth
in North Africa without equivalent growth in working hours
could imply increases in temporary or part-time
The economic recovery from the pandemic
employment as well as in the numbers of those
has been particularly strong in the North
working fewer hours in full-time employment, for
African subregion. North Africa attained around
instance, because of greater care responsibilities. It
4.8 per cent growth in 2021 and 3.5 per cent in
may also represent an increase in participation of
2022 and is expected to attain 4.2 per cent in 2023
those on the margins of the labour market, many
(IMF 2022b). There was a recuperation of total
of whom are women. Increases in the incidence of
output to pre-pandemic levels by 2021. However,
temporary employment, in particular, are common
there are increasing risks to growth in the sub-
in post-crisis periods (ILO 2022a).
region. Several countries in North Africa, such as
Egypt, are net importers of oil and food and they
began 2022 with high levels of debt (Gatti et al. Labour market trends
2022). Morocco has become a net importer of food
because of drought – an example of how Africa in sub-Saharan Africa
is becoming more vulnerable to climate change. Sub-Saharan Africa is experiencing very uneven
Furthermore, spatial inequalities in the region
growth, and this pattern is predicted to continue
remain a structural barrier to more inclusive
into 2023. The subregion saw 4.3 per cent growth
growth patterns and risk perpetuating inequalities.
in 2021 and 3.6 per cent in 2022, and 3.8 per cent
Disadvantaged areas with limited connections to
is expected for 2023. Regional figures hide uneven
the centres of economic activity – particularly rural
existing and projected growth patterns. Positive
areas – are systematically excluded from work
growth in 2022 was supported by particularly
and economic opportunities (World Bank 2020).
strong performance of hydrocarbon exporters
Population-adjusted working hours are still such as Nigeria and Angola, thanks to higher prices
behind the levels of 2019, but total working and increased output (World Bank 2022b). Regional
hours are up because of population growth. growth was also supported by South Africa in 2021,
Following the initial drop in working hours at the but rising unemployment, power shortages and
height of the COVID-19 pandemic, total working infrastructure damage from climate events have
hours in North Africa are expected to return to slowed growth in the region’s largest economy
pre-pandemic levels. Total weekly working hours, (World Bank 2022b). Relaxation of pandemic re-
denominated in full-time equivalent (FTE) jobs, strictions in many countries throughout 2022 has
were estimated to be around 59 million in 2022; also facilitated this relatively strong overall growth
the figure was 57 million in 2019, before the pan- in the region (World Bank 2022b).
demic, and down to 52 million in 2020 (table 2.1).
The conflict in Ukraine is placing many direct
Although this increase in labour input marks a
and indirect pressures on regional growth. Many
return to a pre-pandemic level of economic activity,
African countries are reliant on wheat imports
once population growth is taken into account,
from the Russian Federation and Ukraine (IMF
the ratio of total weekly hours to the population
2022d; World Bank 2022b). The conflict in Ukraine
aged 15 to 64 is still below pre-pandemic levels,
pushed millions more Africans into poverty in 2022,
at 17.6 weekly hours, compared with 17.9 weekly
and many more are expected to fall into poverty in
hours in 2019. This suggests that the labour market
2023 (AfDB 2022). There are widespread warnings
recovery in North Africa continues to be laggard.
that current monetary tightening to fight inflation
The recovery exhibits a reduction in hours could overshoot, potentially leading to high levels
worked per person employed; this reduction of unemployment (IMF 2022d). Sub-Saharan Africa
may include people working fewer hours in a is particularly vulnerable to food price inflation and
full-time job as well as an increasing incidence shortages, which increase poverty and create a
of part-time and temporary employment. barrier to growth (World Bank 2022b). There has
Moreover, the EPR in 2022 remained below pre- also been a recent increase in the proportion of
pandemic levels, at 38.8 per cent, compared with countries in Africa at high risk of debt distress (from
39.2 per cent in 2019. This is despite an increase 53 per cent to 61 per cent) (World Bank 2022a).
X Table 2.1. Estimates and projections of working hours, employment, unemployment

and labour force, regional and subregional, Africa, 2019–24
Region/subregion Ratio of total weekly hours worked Total weekly working hours in FTE jobs
to population aged 15–64 (FTE = 48 hours/week) (millions)
2019 2020 2021 2022 2023 2024 2019 2020 2021 2022 2023 2024
Africa 23.6 21.9 22.4 23.1 23.1 23.2 363 347 365 386 397 411
North Africa 17.9 16.1 16.8 17.6 17.5 17.7 57 52 55 59 60 62
Sub-Saharan Africa 25.0 23.4 23.8 24.5 24.5 24.6 306 295 309 327 337 349
Employment-to-population ratio Employment

2019 2020 2021 2022 2023 2024 2019 2020 2021 2022 2023 2024
Africa 58.5 57.2 57.6 58.1 58.3 58.4 459 462 478 496 511 527
North Africa 39.2 37.7 38.2 38.8 38.8 38.8 65 64 66 68 69 71
Unemployment rate Unemployment

2019 2020 2021 2022 2023 2024 2019 2020 2021 2022 2023 2024
Africa 6.5 7.1 7.2 7.1 7.1 7.0 32.0 35.3 37.0 37.9 39.1 39.8
North Africa 10.9 12.0 11.6 11.3 11.3 11.1 8.0 8.7 8.6 8.7 8.8 8.9
Sub-Saharan Africa 5.7 6.3 6.4 6.4 6.4 6.4 24.0 26.6 28.4 29.3 30.3 30.9
Labour force participation rate Labour force

2019 2020 2021 2022 2023 2024 2019 2020 2021 2022 2023 2024
Africa 62.5 61.6 62.1 62.6 62.7 62.8 491 498 515 534 550 566
North Africa 44.0 42.8 43.2 43.7 43.7 43.7 73 72 74 77 78 80
Indicators of total working hours and the region, especially those in rural areas. Despite
employment suggest that a relatively quick lockdowns and other COVID-19 containment meas-
labour market recovery took place in 2021. ures, as well as impacts on business from supply
In sub-Saharan Africa, total working hours de- chain shocks, much of the informally employed
nominated in FTE terms showed a quick rebound population in sub-Saharan Africa were more likely
in 2021, to 309 million FTE jobs, compared with to have to work than were their better-paid and
306 million in 2019. This increased to 327 million formally employed counterparts.
FTE jobs in 2022. These figures are consistent with
an increase in total employment from 394 mil- Significant population growth has kept
lion in 2019 to 428 million in 2022. In fact, total employment and average working hours de-
employment did not decrease during the peak pressed, partially undermining gains in decent
pandemic years of 2020 and 2021 in sub-Saharan work. For a start, the weekly hours per person
Africa. Such trends relate also to high working aged 15 to 64, of 24.5 hours, in 2022 had not yet
poverty rates, informality and the lack of social recovered to pre-pandemic levels. At the same
protection available to much of the labour force in time, the EPR in 2022 remained, at 63.1 per cent,
below the pre-pandemic level (63.6 per cent in The complexity of climate change and the
2019). This suggests that population growth con- breadth of its impacts will have major implica-
tinued to drive employment growth as well as tions for the labour market in the region. Climate
total FTE growth in sub-Saharan Africa throughout change, including increasing global temperature,
2020 and 2021 and that total working hours per is contributing to greater incidence of natural
person are not yet back to pre-pandemic levels. disasters and extreme weather events as well
It appears that many people are employed but as slow-onset disasters. These include flooding,
working fewer hours than they would like and that droughts, land degradation, soil erosion, heat-
time-related underemployment has been amplified waves and unpredictable rainfall. In Africa, rising
in the region. temperatures are negatively affecting ecosystems
and the jobs and livelihoods closely linked to them,
The statistics of increasing informality and
such as in agriculture, a sector upon which much of
working poverty paint a more accurate picture
the employed population relies. In East Africa and
of the labour market impact in sub-Saharan
the Horn, for example, where rain-fed agriculture
Africa than do the unemployment figures. The
and pastoralism are widespread, unpredictable
unemployment rate in the region did increase from
rainfall and rising temperatures are leading to food
5.7 per cent in 2019 to 6.4 per cent in 2021 and then
insecurity and driving human displacement; pasto-
remained at 6.4 per cent in 2022. Although this
ralists and farmers are forced to migrate in order
trend is similar to that of the global unemployment
to maintain their livelihoods (DTM 2021). In the
rate over this period, it does not fully capture the
absence of regular migration pathways, migrants
lack of productive opportunities for much of the
are exposed to protection risks and decent work
labour force. Indeed, many of those working
deficits. At the same time, many countries in Africa
find themselves among the ranks of the working
are experiencing heat-related problems that are
poor, that is, living in households with per capita
damaging workers’ health and having a negative
earnings that keep them below the moderate or
impact on the economic activity of enterprises.
extreme poverty line. Around 60.8 per cent of total
It is estimated that up to 2.3 per cent of total
employment, or 251 million employed people, were
working hours in Africa will be lost to heat stress
living below the moderate poverty line of US$3.10 a
in 2030 relative to a situation without heat stress;
day (2011 PPP per capita) in 2021. Many of those in
East Africa and West Africa are the most affected
poor-quality employment in sub-Saharan Africa are
subregions (ILO 2019).
in informal employment. New estimates suggest
that 87.3 per cent of the employed population in Africa has low levels of resilience to and
sub-Saharan Africa were in informal employment readiness for climate change, so the population
in 2022, equating to 373 million employed people, is highly exposed to climate change impacts.
up from 86.9 per cent in 2019. The degree to which climate change will impact
a society or community depends, in part, on
climate change resilience factors. The Notre
Job creation potential from Dame Global Adaptation Initiative (ND GAIN)
climate change adaptation Index uses a composite of different indicators to
assess a country’s vulnerability to climate change
Africa’s share of global carbon emissions is and its readiness to improves its resilience (Chen
around 3 per cent, despite the region accounting et al. 2015). Countries in Africa dominate the
for 17.4 per cent of the world’s population in lowest rankings of vulnerability and readiness.
2021 (AfDB 2022; UNDESA 2022). The region also Recognizing this, and also acknowledging the
fares relatively well in terms of its renewable energy historical contribution of developed countries to
production; with appropriate policies, governance climate change, the Glasgow Climate Pact, agreed
and action, indigenous clean renewable energy upon at the UN Climate Change Conference of the
could account for up to 67 per cent of sub-Saharan Parties in 2021, reaffirmed the pledge to provide
Africa’s energy needs by 2030 (IRENA 2020). At US$100 billion a year to developing countries to
the same time, many of the minerals needed for expand provisions for climate change adaptation.
technologies to facilitate a global just transition are The African Development Bank calculates that
found in Africa, including lithium, cobalt, copper climate change adaptation will cost the region
and rare earth minerals. US$50 billion a year by 2050.
X Figure 2.1. Climate change resilience (ND GAIN scores) and informal employment rate
(percentages)
80
60
ND GAIN Index
40
20
0 10 20 30 40 50 60 70 80 90 100
Informal employment rate
Africa Americas Arab States Asia and the Pacific Europe and Central Asia
Note:For the ND GAIN Index, a high score means low levels of vulnerability and high levels of readiness for
climate change; a low score means high levels of vulnerability and low levels of readiness for climate change.
Source:Notre Dame Global Adaptability Index (ND GAIN) and ILOSTAT, ILO modelled estimates, November 2022.
A low level of climate change resilience in development. Such efforts are typically labour-
a country is closely related to decent work intensive projects that contribute to job creation
deficits. As figure 2.1 shows, an increasing vul- and can furnish workers with skills that can be
nerability to climate change directly correlates used in other projects (ILO 2018a). Investment
with an increasing rate of informal employment in skills development – particularly skills devel-
(used as a proxy for decent work deficits). Many opment in areas of climate adaptation, such as
of those in poor-quality employment are most activities relating to water and forestry – can be
at risk of climate change impacts, and yet this a suitable policy option to support new entrants
kind of employment is often prevalent in climate- into the labour market and to help offset labour
vulnerable situations. Many of these workers will market displacement arising from climate change.
not have access to social security and will have The enhancement of social protection policies,
limited employment support in response to climate including eligibility and access, can help to sustain
change impacts. This is particularly a concern in workers who are impacted by climate change in
Africa, where there is a preponderance of countries labour market transitions The adoption of sus-
with the poorest climate change resilience rankings tainable practices, including in agriculture, and
and the highest rates of informal employment. enhancement of resilience in rural areas are vital
Climate change adaptation has the potential to climate change adaptation efforts (ILO 2022b).
to contribute significantly to job creation These are, however, just the tip of the iceberg of
and livelihoods. Although climate adaptation policy options available to facilitate climate change
can take many forms, many of these will entail adaptation and contribute to job creation, better
construction jobs, in particular in infrastructure jobs and livelihood support.
X Americas
The macroeconomic situation and growth out-

look of both Latin America and the Caribbean
Labour market trends in Latin
and North America has been dampened by America and the Caribbean
the combination of geopolitical uncertainty in
Ukraine and persistent inflation. Both factors Weakening of external demand is affecting
have eroded consumer and business confidence the region’s outlook, especially among key
and reduced overall aggregate demand and in- exporters. Initial boosts of commodity exports in
vestment. In turn, job growth has weakened and, early 2022 began to erode in the second half of the
in some instances, turned negative. year (UNCTAD 2022). This is driven in part by overall
weakening of external demand as global economic
Slowdowns in Brazil and Mexico weighed on growth slows and inflation remains sticky. It will
the growth performance of Latin America and make it difficult to sustain recent gains in formal
the Caribbean in 2022, and further decline is employment in Latin America and the Caribbean
expected in 2023. In the case of Latin America and for wage growth in the region to keep pace
and the Caribbean, GDP growth for 2022 at with inflation. The IMF estimates that inflation
3.4 per cent may be down from the initial rebound was around 12.1 per cent in 2022 and will ease to
of 6.6 per cent in 2020 but is significantly higher 8.7 per cent in 2023; the highest rates on record
than pre-pandemic rates (IMF 2022b). Despite for the past quarter-century (IMF 2022a).
this, significant decelerations in the growth rate
of the subregion’s major economies, notably Brazil Employment growth remained robust over
and Mexico, have prevented more elevated rates 2022. Despite the slowdowns in economic ac-
(IMF 2022a). Following relatively strong growth tivity that took place throughout 2022, overall
in the first half of 2022, GDP has since slowed employment growth for the region remained
as commodity prices have weakened and global strong at 4.9 per cent, following 6.4 per cent in
financial conditions have deteriorated. As a result, 2021. As a result, the unemployment rate dropped
and against the backdrop of persistent inflation, to 7.0 per cent in 2022, compared with 8.0 per cent
growth is expected to decrease further in 2023, in 2021 and well below the pandemic peak of
with estimates ranging from 1.4 to 1.8 per cent 10.2 per cent (table 2.2).
(ECLAC 2022; IMF 2022b) With a reduction in the GDP growth rate,
In North America, GDP growth in Canada employment growth is expected to slow
and the United States has similarly slowed. between 2023 and 2024 and will only suffice
The two countries’ growth is forecast to be 3.4 to offset the growth in the working-age
and 2.3 per cent, respectively, for 2022, but population. Employment levels in the region are
both economies have already witnessed weaker expected to grow moderately over the coming
growth than originally anticipated (IMF 2022a). years. Following relatively strong job gains in
This slowdown has been driven by historically 2022, employment growth will slow to 1.0 per cent
high and persistent inflation (in mid-2022, infla- and 1.5 per cent in 2023 and 2024, respectively.
tion stood at approximately 7 per cent in Canada Given that GDP growth will remain relatively
and 8 per cent in the United States) and by global low, the continued growth in employment
uncertainty and weakening global demand (IMF suggests a relatively high employment elasticity
2022a). In the United States, according to the US of growth. The employment gains will be in line
Bureau of Economic Analysis’s updated release, with working-age population growth and, as a
GDP fell by 0.6 per cent in the second quarter of consequence, the EPR in the region will remain
2022, following a 1.6 per cent decline in the first close to its current rate of 58.0 per cent – a
three months of the year (BEA 2022). In Canada, the considerable improvement on the low reached in
latest estimates show that growth is still positive 2020 (53.1 per cent), but still below pre-pandemic
but at an annualized rate of only 0.1 per cent. levels (58.5 per cent in 2019).
X Table 2.2. Estimates and projections for working hours, employment, unemployment
and labour force, regional and subregional, Americas, 2019–24
2019 2020 2021 2022 2023 2024 2019 2020 2021 2022 2023 2024
Americas 26.0 22.6 25.0 26.3 26.0 26.0 368 321 358 378 375 379
Latin America 25.6 21.5 24.6 26.1 25.8 25.9 231 196 226 241 241 244
and the Caribbean
North America 26.9 24.6 25.9 26.8 26.3 26.4 137 125 132 136 134 135

2019 2020 2021 2022 2023 2024 2019 2020 2021 2022 2023 2024
Americas 59.3 54.4 56.8 58.7 58.4 58.3 469 435 458 478 481 486
Latin America 58.5 53.1 55.9 58.0 57.9 58.0 286 263 279 293 296 300
and the Caribbean
North America 60.5 56.5 58.2 59.9 59.3 58.8 183 173 179 186 185 185

2019 2020 2021 2022 2023 2024 2019 2020 2021 2022 2023 2024
Americas 6.4 9.4 7.8 5.8 6.1 6.2 32.2 45.3 39.0 29.4 31.3 32.3
Latin America 8.0 10.2 9.2 7.0 7.0 6.9 24.8 29.8 28.4 22.1 22.1 22.4
and the Caribbean
North America 3.9 8.2 5.6 3.8 4.7 5.1 7.4 15.4 10.6 7.3 9.2 9.9

2019 2020 2021 2022 2023 2024 2019 2020 2021 2022 2023 2024
Americas 63.4 60.1 61.6 62.3 62.2 62.2 502 481 497 508 512 518
Latin America 63.6 59.1 61.6 62.4 62.2 62.4 311 292 308 315 318 323
and the Caribbean
North America 62.9 61.6 61.6 62.2 62.2 61.9 191 188 190 193 195 195
Unemployment levels and rates are expected It would be, however, partly a result of the fact that
to remain unchanged over the course of participation rates are expected to remain more
the next two years. As the participation rate than a full percentage point lower than in 2019.
stabilizes (relative to the peak of pandemic-induced The slower recovery of sectors predominantly
disruption) and assuming that employment gains employing women continues to put women at
remain in line with working-age population growth, a disadvantage. Women’s employment decreased
the unemployment rate for Latin America and to a greater degree than men’s in the Latin America
the Caribbean is anticipated to remain at around and the Caribbean subregion between 2019 and
7.0 per cent through to 2024. Although this rate 2021 (by 1.8 per cent per annum for women versus
would be unchanged from 2022, it would remain 0.7 per cent per annum for men). The employment
1.0 percentage point below the pre-pandemic level. recovery in 2022 was quicker for women than for
men, but considerable heterogeneity is hidden and Colombia and Paraguay (7 per cent). The
within this recovery. Sectors employing dispropor- gains in formal employment since the height of
tionately high numbers of women were adversely the pandemic are also a result of a number of
affected by the pandemic and these sectors have country-specific policies that were implemented
had a slower path to recovery (World Bank 2022d). to bolster formal job creation (ECLAC and ILO 2021).
Accommodation and food services as well as do- Throughout 2022, gains slowed and, given the in-
mestic services contracted the most sharply and creasing uncertainty of the outlook, businesses by
before the pandemic at least 60 per cent of em- and large adjusted their workforce complements
ployees were female in both these sectors. Sectors in 2022 by adjusting hours rather than hiring more
with relatively high levels of male employment, formal workers.
such as construction and transportation, have
Informal employment as a share of total
recovered more quickly (ILO 2022c). Some sectors
employment increased marginally between
previously dominated by female workers – such
2019 and 2021, to 53.7 per cent in 2022. The
as real estate and administrative services – have
overall increase in employment in the region
reported rises in the share of male employment
since late 2020 is also partly due to a recovery in
in the course of pandemic recovery, placing more
informal employment. Between half and more
constraints on the employment prospects of
than three quarters of the net gain in jobs over the
women in the region. For both men and women,
past two years has been from informal job growth
the EPR is expected not to recover to pre-pandemic
(ILO 2022c). 2 The recent increases in informal
levels even by 2023.
employment are largely due to the lifting of pan-
demic-related restrictions on own-account workers
Quality of employment and the reopening of many small businesses,
many of which are informal in nature. Yet, given
remains a concern in Latin that formal job growth has outpaced informal,
America and the Caribbean the overall shares of informal employment have
declined in a number of countries in the region
Elevated hours of work point to increased pres- (figure 2.2). The decline has been most pronounced
sure on existing workers. Despite a slowdown in in Uruguay and Costa Rica, where the share of
economic activity, employment growth is expected informal employment has fallen by 5 and 3 per-
to remain muted in 2023 and 2024, yet total weekly centage points, respectively. The other countries
hours remain marginally higher than pre-pandemic shown in the figure have also seen declines in the
levels. In 2022, total weekly hours in FTE jobs per share of informal employment since late 2019, with
person employed reached 39.6 (compared with the exception of Peru.
38.7 in 2019) and are expected to remain at that
There is a growing risk that the declining trend in
level through 2023.
informal employment will reverse, with adverse
Formal job creation has fully recovered from effects on young women in particular. A number
the pandemic, but further gains have stalled. of factors could lead to increased informality in the
Bolstered by a combination of strong economic coming years, including the removal or weakening
growth in 2021 and at the beginning of 2022, levels of policies to support formal employment and the
of formal private employment have fully recovered creation of new formal employment. Furthermore,
from the pandemic in the vast majority of coun- the context of uncertainty poses a threat to the
tries in the region (ILO 2022c). As of June 2022, creation of formal work opportunities. As formal
among countries with available data (Argentina, employment growth slows, there is a risk that in the
Brazil, Colombia, Costa Rica, El Salvador, Mexico, absence of decent work opportunities informal jobs
Paraguay, Peru and Uruguay), formal private will become the default. There are already some
employment levels were higher than those in early indications that such a situation could be
June 2020. Over the two-year period, formal job taking hold. At the end of 2021, among 11 countries
growth was particularly strong in Brazil (8 per cent) with available data, nearly one in every two jobs
2 Data refer to Argentina, Brazil, Costa Rica, Chile, Mexico, Paraguay and Peru. Figures refer to shares of net employment gains
between Q3 2020 and Q3 2022 and range from a high of 83 per cent in Paraguay to a low of 47 per cent in Chile.
X Figure 2.2. Change in the share of informal employment in total employment, 2019–22
(percentage points)
1
2.5
0
–0.5 –0.6 –0.2
–1 –1.5 –1.3
–2
–3 –3.2
–4
–5.0
–5
Argentina Brazil Chile Costa Rica Mexico Paraguay Peru Uruguay
Note:Data refer to Q4 2019 and Q1 2022 (with the exception of Chile and Mexico, for which the data refer to Q2 2022).
Source:ILO (2022c).
created was informal. The challenge of creating Employment growth has already begun to
enough decent work opportunities relates to the slow in Canada. Typically, the labour market is a
fact that 8 million individuals of working age are lagging indicator, so weaknesses here are typically
expected to join the labour force in the region over observed some time after economic growth slows.
the next two years. This means that young workers However, in the United States, despite negative
are particularly vulnerable. Young women were GDP growth in the first half of 2022, employment
already hit hard during the pandemic because they has continued to grow, almost uninterrupted
were disproportionately concentrated in sectors (figure 2.3). Over the first eight months of 2022,
that were affected by lockdowns. the US economy added 3 million jobs and the
unemployment rate remained near historic lows.
Somewhat contrastingly, despite the fact that
Labour market trends GDP has all but remained in positive territory,
in North America employment in Canada was already beginning to
fall in June 2022. As a result, in the latter half of
The onset of a recession seems inevitable. The 2022 the unemployment rate in Canada has in-
US economy shrank for two consecutive quar- creased from a historic low, whereas in the United
ters to the start of 2022. The third update on the States it has remained at or near an all-time low.
second quarter reflected a downward revision
on exports that were not captured in preliminary Economic growth is forecast to remain weak in
estimates. The decline in GDP of 0.6 per cent in 2023. Following robust growth in both countries
the quarter was mainly a result of reductions in in 2021, GDP growth is expected to decelerate and
inventory investment, residential fixed investment remain weak throughout 2023. GDP growth in
and government spending (at the federal, state 2023 in the United States should reach 1.0 per cent
and local levels). In Canada, growth has remained and in Canada 1.5 per cent (IMF 2022b). In both
positive (0.1 per cent in July 2022), driven by a instances, the pace of growth will be considerably
modest rebound in the oil and gas sector as well weaker than in 2022 (less than half). The fact that
as strong growth in agriculture. Persistent weak- inflation has lasted longer and remained much
ening of manufacturing and exports to the United higher than expected has translated into more
States has posed a growing risk of a recession severe and frequent increases in interest rates than
(IMF 2022a). previously anticipated. Although both the United
X Figure 2.3. Employment levels in North America, seasonally adjusted (January 2021 = 100)
108
106
104
102
100
Jan Apr Jul Oct Jan Apr Jul Oct
2021 2022
United States Canada
Source:ILOSTAT, Short-Term Labour Force Statistics.
States and Canada are net energy exporters and per person unemployed reached more than two in
receive a boost to national income from higher mid-2022, with Canada not far behind. Employers
energy prices, for households the cost of living is across many sectors of the economy have been
likely to increase. Over the next year, residential struggling to fill job openings. The situation has
and private sector investment is expected to been particularly acute in certain sectors, such as
remain muted and consumer spending weak as healthcare and accommodation and food services.
household purchasing power continues to erode. The post-pandemic labour market has been charac-
terized by significant shifts in employment across
Labour markets will continue sluggishly along
and within sectors and occupations. Many of these
in 2023 and 2024. As GDP growth continues to
shifts are s upply-side driven, such as nurses leaving
weaken, employment growth will also slow con-
because of burnout or workers in the accommo-
siderably (table 2.2). After 3.6 per cent growth
dation and food services sector changing jobs in
in employment in 2021 and 3.7 per cent growth in
search of more decent work. In the latter half of
2022, job gains will stall in the coming years, even
2022, the number of vacancies started to decline as
contracting by 0.1 per cent in 2023. Amidst growing
growth slowed (US Bureau of Labor Statistics 2022).
labour force growth, unemployment rates are
expected to increase moderately over the fore- Skill shortages in North America have reached
cast period. decade highs. The ManpowerGroup Surveys found
that in the United States talent shortages were par-
ticularly elevated in 2022: 74 per cent of employers
Labour and skill shortages are stated that they had difficulty in finding the talent
widespread in North America they needed (compared with 46 per cent in 2018)
(ManpowerGroup 2022a). In Canada the figure was
Labour market tightness reached all-time highs 77 per cent (compared with 41 per cent in 2018)
in 2022. Once the pandemic-induced restrictions and employers cited challenges in finding the ap-
were lifted (by and large) in early 2021, the demand propriate technical skills and personal strengths
for labour far exceeded the numbers of available of (ManpowerGroup 2022b). In both the United States
workers (figure 2.4). This issue in both the United and Canada talent shortages were elevated in
States and Canada has intensified over the past two construction, manufacturing and wholesale and
years. In the United States the number of vacancies retail trade, and in Canada such shortages were
X Figure 2.4. Number of job vacancies per person unemployed
2.0
1.5
1.0
0.5
0
2015 2016 2017 2018 2019 2020 2021
United States Canada
Source:ILO calculations based on Federal Reserve Economic Data (FRED), US Bureau of Labor Statistics
and Statistics Canada.
also elevated in IT and technology and education, placing downward pressure on labour force
health and government. growth. Although this structural shift in the demo-
Population ageing will continue to constrain graphic composition of the labour force has been
labour force growth in the long run. Short-term long in the making, it is exacerbating the current
pandemic-induced labour and skill shortages are labour and skills shortage problem. Immigration,
underpinned – at least in part – by a structural constrained during the pandemic, will play a key
slowdown in labour force growth as a result role in boosting labour force growth in the future,
of population ageing. Large numbers of baby but efforts to retain older workers will be crucial,
boomers, often in high-skilled occupations, have as will efforts to support greater labour market
reached retirement age and left the workforce, engagement among under-represented groups.
X Arab States
The economies of the Arab States contracted There are some positive indicators of growth for
significantly during the pandemic and are dis- the region. High vaccination rates were achieved
playing a slower rebound from the immediate in 2022, meaning that pandemic restrictions could
pandemic impact than many other regions, with be lifted and hence a boost provided to GDP (World
only 2.5 per cent growth in 2021. The latter was Bank 2022e). Growth in the region is also being sup-
one of the lowest regional growth rates in the ported by a particularly strong performance of Saudi
world that year. The region is now catching up, Arabia, thanks to measures to attract private invest-
with 6.6 per cent regional growth expected for ment, increased female labour force participation,
2022 and 3.9 per cent projected for 2023. Growth an expanded tourism sector and proactive public
will be disproportionately weighted towards Gulf finance management (Mati and Rehman 2022).
Cooperation Countries (GCC) that will benefit from Ongoing economic diversification and more active
higher government revenues thanks to higher development of the sovereign wealth fund should
hydrocarbon prices. also strengthen the country’s longer-term prospects.
There are likely to be very different pictures High youth unemployment rates in the region
for the net resource exporters and the other persist, but a spectrum of decent work op-
countries in the region. Hydrocarbon-exporting portunities for youth could be derived from
countries such as those in the GCC are predicted the transition to a green economy. The total
to benefit from higher commodity prices resulting unemployment rate in non-GCC countries in
from the conflict in Ukraine, although this highlights 2022 was significantly higher, at 14.3 per cent,
the region’s ongoing reliance on fossil fuel produc- than the unemployment rate in GCC countries,
tion and vulnerability to global prices (Gatti et al. at 4.0 per cent. 3 However, youth (aged 15–24)
2022). Continuing political and economic turmoil in continue to be particularly affected by the pan-
the region is also affecting the region’s prospects; demic in non-GCC countries, which had a youth
for example, the situation in Lebanon continues unemployment rate of 29.8 per cent in 2022, down
to limit inward investment. Countries that began from a peak of 31.3 per cent in 2020, compared
2022 with high levels of debt have been espe- with an unemployment rate for adults (aged 25+) of
cially vulnerable to global changes, including via 10.3 per cent in 2022 (after a peak of 10.5 per cent
monetary policy spillovers. Currency devaluations in 2020) (see Appendix C, table C11). NEET rates
in several countries are increasing inflation further. for the region are also particularly elevated (see
Low-income demographic groups are the most vul- Chapter 1). Given the region’s dependence on
nerable to the spiralling food and energy prices and hydrocarbons for economic growth, the poten-
therefore face the greatest economic challenges. tial for green investment to stimulate job creation
for youth is significant, and simulations of the
employment impacts of green policy measures
Labour market trends suggest that more than 400,000 jobs could be
in the Arab States created for youth in the Arab States (ILO 2022d).
Notably, however, less than 10 per cent of these
Trends in total weekly hours reflect an economic would be jobs for young women, to judge by the
recovery but not yet a full labour market re- simulations, reflecting the persistent gender
covery. Total weekly working hours in FTE jobs in inequalities that hamper the region’s progress.
2022 (51 million FTE) returned to pre-crisis (2019)
levels (table 2.3). This was after a 9 per cent drop
in 2020 and a steady increase since. Total working
Jobs in the just transition
hours in FTE jobs reflect labour input in the economy to a green economy
and correlate with overall economic growth. The in the Arab States
recovery in hours was driven by non-GCC countries,
which tend to have lower per capita incomes and Although all countries and territories are af-
poorer quality of work. For instance, in 2021 around fected by climate change, few are both major
36 per cent of the employed in non-GCC countries contributors to GHG emissions and also likely
were in working poverty (according to a moderately to be so heavily impacted as the GCC countries.4
poor threshold of US$3.10 per day per capita in 2011 Hydrocarbons account for significant proportions
PPP terms) compared with less than 1 per cent in of GDP in GCC countries (for example, 59 per cent
GCC countries. This suggests, as was observed in Kuwait, 38 per cent in Qatar and 27 per cent in
in many countries globally, that although those in Saudi Arabia) (World Bank 2022e). At the same
informal employment and without social safety time, a 2 ºC increase in global temperatures above
nets were heavily impacted by the pandemic, they pre-industrial levels would see a 4–5 ºC increase in
often had little choice but to find ways of resuming surface temperatures in GCC countries (MacDonald
employment. Total weekly hours in the GCC coun- 2022). Temperatures have already been increasing
tries have yet to return to pre-crisis levels and are significantly, impacting the day-to-day life of thou-
not forecast to do so till around 2024. sands of people for several months of the year.
3 Unemployment rates in GCC countries are typically lower owing to the large number of international migrant workers in the
labour force, whose stay (that is, their visa) is conditional on having a job.
4 It should be noted that non-GCC countries too are affected by climate change impacts and that for them also a just transition
is highly relevant. Non-GCC countries face many of the same and also some different challenges (including green financing and
lack of green technologies) with regard to a just transition.
X Table 2.3. Estimates and projections of working hours, employment, unemployment

and labour force, regional and subregional, Arab States, 2019–24
2019 2020 2021 2022 2023 2024 2019 2020 2021 2022 2023 2024
Arab States 22 .0 19.6 20.2 20.9 21.0 21.2 51 46 48 51 53 54
Non-GCC 15.7 14.3 14.8 15.3 15.5 15.7 22 21 22 23 24 26
GCC 31.6 28.2 29.2 30.5 30.7 31.0 29 26 26 28 28 29
2019 2020 2021 2022 2023 2024 2019 2020 2021 2022 2023 2024
Arab States 46.8 45.4 45.1 45.6 45.9 46.0 54 54 54 56 58 60
Non-GCC 35.9 34.6 34.5 35.2 35.6 35.9 26 25 26 27 29 30
GCC 64.0 63.2 63.0 63.8 64.0 64.1 29 28 28 29 29 30
2019 2020 2021 2022 2023 2024 2019 2020 2021 2022 2023 2024
Arab States 8.7 10.1 9.8 9.3 9.3 9.5 5.2 6.1 5.9 5.8 6.0 6.3
Non-GCC 13.7 14.8 14.8 14.3 14.2 14.2 4.1 4.4 4.5 4.6 4.8 4.9
GCC 3.8 5.4 4.7 4.0 4.0 4.3 1.1 1.6 1.4 1.2 1.2 1.3
2019 2020 2021 2022 2023 2024 2019 2020 2021 2022 2023 2024
Arab States 51.3 50.5 50.0 50.4 50.6 50.8 60 60 60 62 64 66
Non-GCC 41.6 40.6 40.5 41.0 41.5 41.8 30 30 31 32 34 35
GCC 66.6 66.8 66.1 66.5 66.7 67.0 30 30 29 30 31 31
Furthermore, the United Arab Emirates and Saudi labour market transformation, including a demand
Arabia are among the most water-stressed coun- for workers and skills, and job displacement from
tries in the world (World Bank 2022e). The region traditional sectors. An important consideration is
is also subject to rising sea levels and increasing that the Arab States are a major destination for
climate-change-related shocks, including environ- international migrant workers. Around 74 per cent
mental and ecological degradation. All of which has of the employed population in Saudi Arabia were
major implications for workers and enterprises in international migrant workers in Q2 2022 (GASTAT
these countries. 2022), 94 per cent of total employment in Qatar
in 2020 (PSA 2020) and 85 per cent of the labour
GCC countries are, however, committing to the force in Kuwait in 2018 (de Bel Air 2019). Climate
notion of transitioning to a green economy change impacts, including heat stress for many
(World Bank 2022e). This is a necessity from the migrant workers who work outdoors in these
perspectives of diversifying away from depend- countries, are already a factor driving workers
ence on hydrocarbons and also of reducing the to leave, but the shifting labour market structure
countries’ contribution to climate change. Such a will have implications for the demand for these
transition to a green economy will entail significant workers, particularly in filling skill gaps.
There will be inevitable job losses as a result of governments to invest in green sectors, there is a
the transition to a green economy, but there need to incentivize and encourage entrepreneurs
will also be growth in demand for certain oc- to implement green technologies and processes
cupations and skill sets. With a shift away from and participate in the circular economy.
traditional industries, some workers will lose their
Moreover, the notion of a just transition
jobs and have either to find alternative work that
requires that governments and other stake-
demands a similar skill profile or to reskill for newly
created jobs arising from the transition (ILO 2018b). holders work together to support those who
The skills required for many jobs in carbon-inten- will lose out from the consequences of green
sive industries can be applicable to jobs in low- transition. This is particularly important for the
carbon industries such as construction, renewable many workers in vulnerable situations who are
energy generation, urban planning, food produc- likely to be disproportionately affected by the tran-
tion and water management. Such jobs are likely sition; these include informal workers, low-skilled
to include both low- and high-skilled occupations workers and migrant workers. Social protection
and to provide opportunities such as high-income is key, and there is a need to ensure that workers
jobs for youth, including young women. To realize who lose their jobs as a result of the transition are
these gains and mitigate downside risks and costs provided with some sort of support to facilitate
of adjustment, a comprehensive and coordinated their re-employment. In GCC countries, around
strategy that encompasses investment, skills and 10 per cent of all employment is in low-skilled jobs
social protection should be established and imple- and, as mentioned earlier, many of these countries
mented as soon as possible (World Bank 2022e; are heavily reliant on migrant workers, particularly
ILO 2022d). Even where limited resources exist for in the private sector.
X Asia and the Pacific
Growth projections for the region as a whole the pandemic it did not see negative annual growth.
have been revised downwards. The region saw A sharp slowdown in China’s growth worsened by
3.9 per cent growth in 2022 and is expected to see very strict COVID-19 management policies in 2022
4.3 per cent in 2023, but these figures mask great has set the context for the rest of the region (IMF
variance in subregional trends (IMF 2022b). Growth 2022d). Large capital outflow and depreciation in
in 2022 was slower than previously projected, some countries owing to interest rate rises in other
mostly because of downward revisions for East regions have increased debt burdens, which is a
and South Asia (ADB 2022a). As with other regions, problem in the region, since many countries began
the dampened growth projections are put down to the pandemic with high levels of debt (World Bank
the global economic slowdown, rising debt levels 2022f). Energy and food subsidies are reducing
and policy over-reliance on commodity subsidies governments’ ability to spend on core, growth-
(World Bank 2022f). An anticipated decline in enabling services such as health, infrastructure
global demand weighs on the region despite the and education (World Bank 2022f).
recovery in exports since the onset of the COVID-19
South-East Asia and the Pacific are highly
pandemic. The appreciation of the US dollar over
dependent on trade with China, such that
2022 also exacerbated this (IMF 2022d). As in other
economic slowdown in China poses a threat to
regions, inflation is increasing, particularly owing
growth prospects for 2023 (World Bank 2022f).
to high energy and food prices (ADB 2022a).
Dramatic increases in commodity prices will tend
A slowdown in China is stalling growth prospects to hit commodity importers the hardest, whereas
in the rest of East Asia. Growth in this subregion net exporters such as Indonesia and Malaysia will
in 2022 was revised down to 2.9 per cent – consider- be more protected (World Bank 2022f). Myanmar
ably lower than the 6.7 per cent estimated in 2021, continues to be impacted by the ongoing difficult
with 3.8 per cent projected for 2023 (IMF 2022b). economic conditions relating to commodity price
The subregion was unusual in that throughout inflation as well as the political crisis and conflict
(ILO 2022e). The strongest growth in 2022 was from the pandemic has been deeply uneven.
observed in the Philippines, Malaysia and Viet Nam. The highest-paid workers are much more likely
Thailand’s crucial tourism economy is struggling to have returned to work than are lower-skilled mi-
to recover for a combination of reasons (including grant workers (World Bank 2022h). Recent high and
the impact of the “zero COVID” policies in China volatile energy prices have shown how vulnerable
and the conflict in Ukraine) on its biggest markets, the region is with respect to energy imports; there
as well as COVID-19-related immigration restric- is a clear need to become less dependent on these
tions (World Bank 2022f). In the Pacific, a revival imports (ILO 2022f). The region remains highly
of tourist numbers is likely to bolster growth for vulnerable to natural disasters, for example on the
tourist-dependent nations, such as Fiji, the Cook flood plains of Pakistan and Bangladesh. Countries
Islands and Palau (ADB 2022b). such as Pakistan are also increasingly held back by
very high levels of energy subsidies, which weigh
South Asia has seen the strongest growth in
heavily on public finances and are failing to reduce
the region and some of the highest regional
poverty effectively (World Bank 2022g).
figures in the world: 6.0 per cent in 2022 and
5.3 per cent projected for 2023 (IMF 2022b).
Exports of services from the subregion are in- Labour market trends
creasing and are expected to have contributed
positively to growth in 2022 and to do so again
in Asia and the Pacific
in 2023 (World Bank 2022g). The digital services East Asia’s lagging labour market recovery
sector has performed particularly strongly, weighs on the overall recovery across the
whereas sectors like tourism and construction region. 5 Total employment in Asia and the
have not recovered to pre-pandemic levels in most Pacific increased by 30 million from 2021 to
of the subregion (World Bank 2022h). Originally 2022 (table 2.4). The EPR of 56.2 per cent in 2022
high growth projections for India have been re- remained below the 2019 level of 56.9 per cent.
vised downwards and may be so revised further, The slow employment recovery can be partly
given deteriorating global conditions and faster attributed to developments in East Asia. China’s
than anticipated monetary tightening (IMF 2022d). restrictive COVID-19 containment policies, despite
Household consumption will be held back by slow maintaining positive economic growth throughout
recovery of the labour market and by high inflation the pandemic, have had major implications for the
(World Bank 2022g). subregion’s labour market and for that of the whole
South Asia has few direct links with the Russian region. East Asia accounts for a negligible share
Federation and Ukraine but is very vulnerable of the region’s total employment growth between
to the higher global commodity prices that 2021 and 2022, despite accounting for 46 per cent
have resulted from the conflict (World Bank of the region’s total employment in 2022. South
2022h). GDP growth in 2022 was revised down Asia accounted for the majority (74 per cent) of the
by around 2 percentage points as a result of the resurgence in total employment in 2022; this was
conflict, owing to inflation and worsened public mainly among adults, the recovery being slower for
youth (see Chapter 1 and Appendix C, table C15).
finances. Growth prospects were already “uneven
and fragile” and now all figures have been revised Total working hours per person are still below
downwards. Global economic pressures resulting pre-pandemic levels. In Asia and the Pacific,
from the conflict in Ukraine are expected to worsen total working hours in FTE terms are estimated
public finances and domestic inflation in the sub- to have been 1,764 million FTE in 2022. This marks
region. One extreme example is Sri Lanka, which a return to 2019 levels and reflects the economic
is already unable to pay import bills (World Bank recovery. At the same time, weekly hours per
2022h). Several countries, such as Bangladesh, person aged 15 to 64 remain, at 28.6, below the
rely heavily on exports to Europe; weaker demand pre-pandemic level of 29.1. It thus appears, as in
for these goods is reducing growth prospects many other regions, that employment growth as
in the subregion. Inequality both between and part of the labour market recovery has been driven
within countries is growing and the recovery by people working fewer hours, a circumstance
5 Please see ILO (2022f) for more extensive analysis of the labour market situation and outlook.
and labour force, regional and subregional, Asia and the Pacific, 2019–24
2019 2020 2021 2022 2023 2024 2019 2020 2021 2022 2023 2024
Asia and the Pacific 29.1 26.8 28.2 28.6 28.6 28.6 1 761 1 630 1 725 1 764 1 773 1 790
East Asia 34.9 33.6 35.2 34.8 34.8 34.8 834 800 836 825 823 823
South-East Asia 29.4 27.1 27.3 28.6 28.5 28.7 274 256 260 274 276 280
South Asia 23.9 20.7 22.4 23.4 23.4 23.5 638 561 615 651 660 672
Pacific Islands 24.8 23.9 24.2 24.8 24.4 24.5 14 14 14 15 15 15
2019 2020 2021 2022 2023 2024 2019 2020 2021 2022 2023 2024
Asia and the Pacific 56 .9 54.5 55.8 56.2 56.0 55.9 1 874 1 817 1 880 1 910 1 925 1 940
East Asia 63.9 61.6 63.6 63.3 63.0 62.6 875 847 879 878 877 877
South-East Asia 65.6 63.8 63.4 64.2 64.4 64.4 325 320 323 330 335 339
South Asia 46.8 44.3 45.6 46.5 46.5 46.5 655 630 659 681 692 703
Pacific Islands 60.0 58.6 59.8 60.8 60.3 60.0 20 20 20 21 21 21
2019 2020 2021 2022 2023 2024 2019 2020 2021 2022 2023 2024
Asia and the Pacific 4.7 6.1 5.2 5.2 5.1 5.1 93.1 117.7 104.0 104.8 103.7 104.5
East Asia 4.3 4.8 4.4 4.6 4.4 4.3 39.5 42.3 40.1 42.5 40.4 39.7
South-East Asia 2.4 3.0 2.9 2.6 2.4 2.6 8.0 9.9 9.5 8.7 8.4 8.9
South Asia 6.4 9.3 7.5 7.2 7.2 7.3 44.6 64.4 53.4 52.8 54.1 55.1
Pacific Islands 4.6 5.6 4.6 3.6 3.4 3.4 1.0 1.2 1.0 0.8 0.8 0.7
2019 2020 2021 2022 2023 2024 2019 2020 2021 2022 2023 2024
Asia and the Pacific 59.7 58.0 58.9 59.2 59.1 58.9 1 967 1 934 1 984 2 015 2 029 2 045
East Asia 66.8 64.7 66.5 66.4 65.9 65.5 914 889 919 921 917 916
South-East Asia 67.2 65.7 65.3 65.9 66.0 66.1 333 330 332 339 343 348
South Asia 50.0 48.8 49.3 50.1 50.2 50.2 699 694 712 734 747 758
Pacific Islands 62.9 62.1 62.7 63.0 62.4 62.1 21 21 21 22 22 22
that may correspond to more time-related in 2022 – while around 15.7 per cent of the total
underemployment, temporary employment employed population in 2021, equivalent to
and part-time employment. Growth in poor- 294 million people, were in working poverty as
quality employment is likely in a region where defined by a moderately poor threshold of US$3.10
unemployment is relatively low – at 5.2 per cent per day (2011 PPP per capita).
A greater policy focus on expanding social resilience to sustain themselves and their depend-
protection is critical for informal workers and ents through extended periods of disruption.
the ability to sustain future economic shocks.
In countries of destination, such as Brunei
Decent work deficits characterize employment in
Darussalam, Malaysia, Thailand and Singapore,
the region, since economic growth has not been
which rely heavily on migrant workers, en-
accompanied by corresponding improvements
terprises are still struggling to meet their
in decent work (ILO 2022f). Nearly two thirds
labour demand needs. Before the onset of the
(65.6 per cent) of the region’s total employment
pandemic (in 2019), international migrant workers
was in informal employment in 2022. As in other
accounted for nearly 40 per cent of the employed
regions, those in informal employment were par-
population in Singapore, 37 per cent in Brunei
ticularly vulnerable during the pandemic years of
Darussalam, 14 per cent in Malaysia and 7 per cent
2020 and 2021, given their lack of access to social
in Thailand (ILO, forthcoming). Despite the re
protection. Thus, many governments in the region
opening of borders and an end to COVID-19 travel
sought to expand social assistance during this
restrictions, governments have not fully opened
period, with a view to addressing shortcomings
labour migration pathways to pre-pandemic levels.
for the long term (ILO 2020a). Such measures have
The resulting labour shortages in industries that
included extending social protection to informal
rely heavily on migrant workers have prompted
workers (ILO 2020a). Nevertheless, limited fiscal
industry bodies and the private sector to lobby the
space may compromise progress in this regard
government to address the issue by facilitating
over the medium term (ILO 2022f).
the entry of migrant workers, regularizing the
irregular status of migrant workers (for example
Ongoing shortages of migrant in Thailand) and establishing memoranda of
workers in Association understanding with other countries to promote
the inflow of migrant workers (ILO, forthcoming).
of Southeast Asian Nations Despite these efforts, in late 2022 many industry
(ASEAN) countries groups were still citing major labour shortages
as a consequence of the lack of migrant workers,
of destination including in rubber plantations in Malaysia and in
multiple sectors in Thailand such as construction
The COVID-19 pandemic has resulted in major
and manufacturing.
disruption of labour migration in the region,
impacting livelihoods in countries of origin and Governments perceive labour migration as
destination (ILO, forthcoming). For net countries necessary for a recovery in economic output
of origin, employment abroad is a major source of in migrant-dependent sectors. Recovery of
livelihood for the workers themselves and for their economic growth, meanwhile, is a critical factor
families and dependents back in their countries shaping the characteristics and magnitude of
of origin, particularly through remittances. The labour migration in South-East Asia. In Malaysia,
pandemic saw a significant drop in deployments for instance, more than 30 per cent of total
of international migrant workers (figure 2.5) as well employment in the agriculture sector is accounted
as an increase in migrants returning home (ADBI, for by migrant workers; in Singapore, more than
OECD and ILO 2022). This resulted in the stock of 60 per cent of workers in the industry sector
international migrant workers decreasing signifi- are migrant workers; and in Brunei Darussalam
cantly in a number of countries (ILO, forthcoming). 56 per cent (ILO, forthcoming). Sectors with high
For many migrant workers, the lack of access density of migrant workers include manufacturing,
to social protection or other support measures construction, accommodation and food services,
(including financial ones) – most of which were and domestic work. In Malaysia, in mid-2022,
available to nationals only – left little choice but manufacturers were claiming to be short of around
to return home.6 Many of these workers are low 600,000 workers, construction required 550,000
paid and have low levels of savings and economic more workers, the palm oil industry reported a
6 These were just some of the challenges faced by migrant workers which affected their decisions and abilities to stay in a country.
Other challenges related to testing and health access, housing constraints and payment of wages (ILO 2020b; ADBI, OECD and
ILO 2022).
X Figure 2.5. Outflows of documented migrant workers, selected ASEAN Member States,
2010–20 (thousands)
(a) Philippines (b) Indonesia

2000 600
1500
400
1000
200
500
332 113
0 0
2010 2012 2014 2016 2018 2020 2010 2012 2014 2016 2018 2020
(c) Viet Nam (d) Myanmar

150 250
200
100
150
79
100
50
77
50
0 0
2010 2012 2014 2016 2018 2020 2010 2012 2014 2016 2018 2020
(e) Thailand (f) Cambodia

150 125
100
100
75
50
50
41 25
23
0 0
2010 2012 2014 2016 2018 2020 2010 2012 2014 2016 2018 2020
Source:ILO (forthcoming).
shortage of 120,000 workers, and chipmakers processing sectors were among those cited as
were lacking 15,000 workers (Lee, Latiff and Chu particularly in need of migrant labour (Heijmans
2022). In Thailand, enterprises took to lobbying 2022). It should be noted that the labour and
the government – noting the labour shortages human rights of migrants cannot be neglected,
in sectors such as agriculture, construction, not only for the sake of the workers involved but
hospitality and garment-making (Charoensuthipan also to ensure there is a level playing field in which
2022). In Singapore, the construction and the labour market can function more efficiently.
X Europe and Central Asia
After a strong recovery from the pandemic in have contracted, largely because GDP growth in
2021, with growth of 5.9 per cent, the region’s the Russian Federation is thought to have fallen
economy grew at 1.9 per cent in 2022 and is more than 3 per cent in 2022 (IMF 2022b). The
expected to slow to 0.7 per cent in 2023. Very economic prospects of some economies in Central
modest annual growth is expected over the Asia were expected to improve in the latter half
medium term. This is a rapidly evolving situation of 2022 (EBRD 2022). Several countries in the
and some estimates suggest that the contraction subregion are benefiting from the relocation of
in the region in 2022 has been even larger (World private businesses from the Russian Federation
Bank 2022i). and Ukraine. Currencies have largely settled to
pre-conflict levels, real estate in major cities is
Growth in 2022 and 2023 has been and will be
booming and some countries’ roles as re-exporters
significantly less than previous projections,
of goods from China are expanding. Oil-exporting
owing to the conflict in Ukraine and the re-
countries such as Kazakhstan and Turkmenistan
sulting economic and political fallout (World
are benefiting from higher oil prices.
Bank 2022i). Geopolitical strife continues to wreak
havoc on the region. The conflict in Ukraine and Major increases in energy prices are placing
tighter monetary policy to attempt to curb inflation significant pressure on energy-intensive indus-
have led to a significant deterioration in economic tries in Europe. With energy prices elevated in the
conditions, with a considerable number of im- European Union (EU), energy-intensive industries
portant spillover effects (for example, increasing are disproportionately affected (Hollinger et al.
migration flows and weakening manufacturing 2022). Manufacturing industry in Spain, for ex-
output stemming from disruptions in supply ample, which employs around 2.5 million people
chains and record high energy prices that have and accounts for 11 per cent of GDP, consumes
been exacerbated by restrictions on European around a quarter of the gas and electricity used
trade with the Russian Federation as well as supply in the country (INE 2022). The situation forces
cuts by the Russian Federation). Inflation in Europe businesses to try to reduce energy consumption
remains elevated and poses considerable risks where possible, for example by adjusting oper-
to household purchasing power; in Central Asia, ations, but levers to adjust operations can be
most economies are confronted with double-digit limited – as observed in efforts to adapt to the
price increases. Some countries have put in place pandemic (Stemmler 2022). Some EU countries
electricity consumption restrictions. are intervening to provide financial support to
energy-intensive industries. For example, in July
There is considerable heterogeneity of GDP
2022 Germany launched a €5 billion fund to support
growth in Europe and Central Asia. The impacts
its most exposed industries, such as chemicals,
of conflict, the global slowdown, and rising prices
glass and metals (BMWK 2022); however, the level
are impacting countries in the region to different
of support needed to cushion the full impact is
degrees. Growth in 2022 is estimated to have
not sustainable.
been of the order of 3.1 per cent in Northern,
Eastern and Western Europe (IMF 2022b), The impact of the energy price crisis on
whereas in Eastern Europe GDP is expected to employment in Europe is not yet known. Though
energy-intensive industries directly employ only grow by 1.6 per cent. This masks considerable
a small percentage of workers in the EU (around intraregional differences: Central and Western
3.2 million people in total, or 1.6 per cent of the Asia lead the charge with 3.4 per cent employment
employed EU-27 workforce), around 15 per cent of growth, compared with a decline in Eastern Europe
the region’s workers are employed in the industry of around 0.7 per cent and a gain of 2.4 per cent
sector as a whole (Bruyn et al. 2020). Any decline in Northern, Southern and Western Europe.
in competitiveness and industrial employment Meanwhile, unemployment across the region is
will also likely have knock-on effects in the region, expected to fall substantially, by more than 3 mil-
whether through weakened macroeconomic pos- lion – equivalent to a 0.7 percentage point drop in
itions, falling investor confidence or input price the unemployment rate.
inflation. In theory, the rising energy prices should
The fallout from the Russian Federation’s ag-
work to accelerate the low-carbon transition in
gression in Ukraine is already stark and the full
Europe, increasing the urgency to move away from
effects on the region’s labour market are not yet
fossil fuels and improving the relative viability of
low-carbon energy sources and technologies. At known. In October 2022, the ILO estimated that
the same time, there are other dimensions, such as 2.4 million jobs had been lost in Ukraine alone (ILO
the suppression of demand by higher household 2022g). The United Nations High Commissioner
spending on energy, with subsequent implications for Refugees (UNHCR) reports more than 7 million
for the shape of the impact on employment in refugees from Ukraine in Europe as of October
different sectors. 2022, including 1.4 million in Poland and 800,000
in Germany (UNHCR 2022). The impact of these
In the long term the energy price shock may inflows of refugees on domestic labour markets,
result in more opportunities for job creation social insurance systems and public services – in-
in the emerging low-carbon sectors. In the cluding in neighbouring countries such as Hungary,
meantime, the impacts of uncertainty and macro- the Republic of Moldova, Poland, Romania and
economic weakening may reduce investment in the Slovakia – are not yet clearly established (ILO
green economy, at least in the short term. Given 2022h). For youth, the labour underutilization
the weakened state of public finances in Europe, caused by the pandemic and the fallout from the
governments will be under pressure to make Ukraine conflict are exacerbating the risk that
savings and to redirect budgets to other sectors, many young people will be scarred by multiple
which may include clean energy providers. Several periods of inactivity and uncertainty; gaps in
countries, such as Germany, have also resorted
experience and expiring skills will increase the
to reviving the use of coal in industry and power
chances of long-term unemployment and under-
generation, although the intention is that this
employment (World Bank 2022j).
move will be temporary and small-scale (European
Commission 2022). Any reversal or watering down Complex and conflicting economic factors in
of previous commitments to the green economy Central Asia will determine the subregion’s
represents a risk to employment in Europe, though labour market prospects in 2023. Several
opportunities to focus on a green recovery will still countries in Central Asia have seen paradoxical
be present. The net impacts of energy prices on short-term benefits from the turmoil in Ukraine,
employment in Europe are a live topic that should for example through a boom in hydrocarbon
be monitored over the coming year. export revenue. Remittances from the Russian
Federation also increased in the first half of
2022, up 96 per cent on the same period in 2021
Labour market trends in in Uzbekistan, as a result of surging demand for
Europe and Central Asia migrant workers and a 30 per cent appreciation
of the rouble (Warren 2022). A significant number
Divergent employment growth in 2022 mir- of business owners in the Russian Federation
rors the economic situation. Except in Eastern and Belarus have sought to relocate operations
Europe, the region witnessed relatively strong job to countries such as Kazakhstan and Uzbekistan,
growth in 2021 as it emerged from the pandemic promoting strong private sector growth there
(table 2.5). The pattern of job growth continued in (Warren 2022). However, the economic prospects
2022, the region as a whole seeing employment of the Russian Federation seem weak and highly
and labour force, regional and subregional, Europe and Central Asia, 2019–24
2019 2020 2021 2022 2023 2024 2019 2020 2021 2022 2023 2024
Europe and 25.8 23.8 25.1 25.4 25.4 25.5 327 301 317 320 320 320
Central Asia
Northern, Southern 26.1 23.9 25.3 26.2 26.0 26.1 158 145 153 158 156 156
and Western Europe
Eastern Europe 26.9 25.5 26.3 25.1 25.5 25.6 110 103 106 100 101 101
Central and 23.5 20.8 22.6 24.0 23.9 24.0 59 53 58 62 63 63

Western Asia

2019 2020 2021 2022 2023 2024 2019 2020 2021 2022 2023 2024
Europe and 54.5 53.4 53.9 54.7 54.5 54.2 416 408 412 419 418 417
Central Asia
and Western Europe
Eastern Europe 56.6 55.7 56.1 56.0 55.8 55.3 139 136 136 135 134 133
Central and 51.2 49.5 50.8 51.9 51.8 51.6 69 67 70 72 73 73

Western Asia

2019 2020 2021 2022 2023 2024 2019 2020 2021 2022 2023 2024
Europe and 6.6 7.0 6.9 6.1 6.3 6.3 29.4 30.9 30.4 27.3 28.2 28.2
Central Asia
Northern, Southern 6.9 7.3 7.3 6.3 6.6 6.6 15.5 16.2 16.3 14.2 14.9 14.8
and Western Europe
Eastern Europe 4.7 5.6 5.2 5.0 5.1 5.1 6.9 8.0 7.5 7.1 7.1 7.2
Central and 9.2 9.0 8.7 7.7 7.8 7.8 7.0 6.7 6.6 6.0 6.1 6.2
Western Asia

2019 2020 2021 2022 2023 2024 2019 2020 2021 2022 2023 2024
Europe and 58.4 57.5 57.9 58.3 58.1 57.8 445 439 443 446 446 445
Central Asia
and Western Europe
Eastern Europe 59.4 59.0 59.2 59.0 58.8 58.3 145 144 144 142 141 140
Central and 56.4 54.4 55.6 56.2 56.1 56.0 76 74 76 78 79 80

Western Asia

volatile. This is likely to translate into weakened Labour force growth

employment prospects in Central Asia, given the
subregion’s strong trade and migrant worker ties is a significant challenge
to the Russian Federation. in the region
Considerable uncertainty regarding the eco-
Falling participation rates explain, in part, im-
nomic outlook for the region is likely to persist.
provements in the unemployment rate.7 The
The dynamic, evolving and volatile situation of the
fact that the unemployment situation in the region
conflict in Ukraine and its consequences make the
continues to fare reasonably well in contrast to
forecast for the region highly uncertain. There
the economic situation may be partly explained
also remain important questions about the impact
by falling participation rates in a context of an
of sanctions on the Russian Federation, and the
ageing population. Between 2019 and 2024, the
effect on neighbouring countries. Already, energy
participation rate in Europe and Central Asia is
rationing is negatively affecting major sectors and
expected to have declined by 0.5 percentage
will be, all else equal, a significant drag on growth
points; in the subregions of Eastern Europe and
in 2023. Although it is too early to determine
Central and Western Asia participation will fall by
whether inflationary pressures will recede in early
as much as 1.1 and 0.5 percentage points, respect-
2023, significant disparities within the region will
ively. The situation is relevant to enterprises in
continue. Modest improvements of the GDP fore-
particular, since falling headline unemployment
cast are expected in Eastern Europe and Central
rates can sometimes suggest that jobs are being
and Western Asia. In 2023, the Russian Federation’s
created and economic activity is expanding, but
GDP is set to decline by 3.5 per cent – not as badly
the combination of falling unemployment and a
as in 2022. Growth in the euro area will barely
diminishing labour force means there is likely to be
surpass 1 per cent, being hampered by higher
more mismatch of skills as enterprises struggle to
energy costs and reductions in external demand,
find the labour and skills they need for their oper-
which are expected to be particularly acute among
ations, and can result in labour hoarding (Colijn
major economies such as Germany and Italy.
and Biehl 2022).8
Unemployment is expected to continue to
Participation rates are already among the
increase marginally. In the face of widespread
lowest in the world. Several regions have wit-
uncertainty and a deterioration in economic
nessed declines in participation rates over the past
growth, the levels and rates of unemployment
several years. This phenomenon was commonplace
are expected to trend upwards over 2023 and 2024.
during the height of the pandemic when many
In Northern, Southern and Western Europe the
workers stopped seeking employment.9 However,
unemployment rate is set to increase slightly to
in Europe and Central Asia, participation rates are
6.6 per cent in 2023 and remain at that level in
projected to be particularly low in 2024 (figure 2.6).
2024. In other subregions the unemployment rate
Only the Arab States have lower participation rates,
will increase to different degrees. In Eastern Europe
which are driven by low female participation,
it is expected to increase marginally to 5.0 per cent
whereas in Europe and Central Asia the male labour
by 2024 – higher than its pre-pandemic level of
force participation rate is the lowest in the world
4.7 per cent. In Central and Western Asia also,
(see Chapter 1).
unemployment is expected to increase marginally
in both 2023 and 2024, to reach 7.8 per cent – still The challenge is exacerbated by a declining
significantly lower than its pre-pandemic rate of labour force. All ILO regions (except Africa and
9.2 per cent in 2019. the Arab States) saw a decline in their labour force
at the height of the pandemic in 2020. Since then,
however, most regions have returned to positive
labour force growth. The exception is Europe and
7 The unemployment rate is the total unemployed population as a proportion of the total labour force.
8 See Chapter 1 for further analysis of global labour force shortages and hoarding.
9 Declining participation rates are also a function of a number of structural factors such as population ageing and declining
participation rates among men in their prime.
X Figure 2.6. Projected labour force participation rates by ILO region and subregion, 2024
(percentages)
70
60 62.2 62.8
58.3 58.3 58.9
56.0
50
50.8
40
30
20
10
0
Arab States Central and Northern, Eastern Europe Asia and Americas Africa
Western Asia Southern and the Pacific
Western Europe
Source:ILOSTAT, ILO modelled estimates, November 2022. See also Table 2.2.
X Figure 2.7. Projected labour force growth between 2022 and 2024 by ILO region
and subregion (percentages)
3 3.2
3.0
1
1.0 0.9
0.7
0
−0.1 −0.8
–1
Arab States Africa Americas Central and Asia and Northern, Eastern Europe
Western Asia the Pacific Southern and
Western Europe
Central Asia. Over the course of 2023 and 2024, the region will need to prioritize boosting product-
region’s labour force is expected to decline. This ivity and investment in order to sustain economic
prediction masks considerable variation within growth over the medium term. Many rural areas
the region. For instance, in Central and Western across Europe could be affected by demographic
Asia the workforce will grow over the coming two ageing and depopulation. Such trends will affect
years (albeit more slowly than in other regions). the composition of the rural workforce, agricultural
However, Northern, Southern and Western Europe production and rural economic performance, as
and Eastern Europe will see significant declines well as the socio-economic organization of rural
in the labour force (figure 2.7). Taken together, communities and even the environment. Therefore,
these two subregions will see a reduction of nearly they may have major implications for livelihoods
2.4 million in their labour forces between 2022 and and food security, and also for the vitality and
2024. Labour force contraction will mean that the attractiveness of rural economies (ILO 2022b).
References
X ADB (Asian Development Bank). 2022a. Asian Development Outlook (ADO) 2022: Mobilizing Taxes
for Development. http://dx.doi.org/10.22617/FLS220141-3.
X ———. 2022b. Pacific Economic Monitor: Financing Resilience to Mitigate the Pacific’s Climate
Vulnerability. https://www.adb.org/publications/pacific-economic-monitor-august-2022.
X ADBI, OECD (Organisation for Economic Co-operation and Development), and ILO. 2022. Labour
Migration in Asia: COVID-19 Impacts, Challenges and Policy Responses.
X AfDB (African Development Bank). 2022. African Economic Outlook 2022. https://www.afdb.org/
en/documents/african-economic-outlook-2022.
X BEA (Bureau of Economic Analysis). 2022. “Gross Domestic Product (Third Estimate), Corporate
Profits (Revised Estimate), and GDP by Industry, Second Quarter 2022 and Annual Update”. BEA
Wire, 29 September 2022. https://www.bea.gov/news/blog/2022-09-29/gross-domestic-product-
third-estimate-corporate-profits-revised-estimate-and.
X BMWK (Federal Ministry for Economic Affairs and Climate Action). 2022. “€5 Billion Aid
Programme Launched for Energy-Intensive Industry”, 14 July 2022. https://www.bmwk.de/
Redaktion/EN/Pressemitteilungen/2022/07/20220714-5-billion-euros-aid-programme-launched-
for-energy-intensive-industry.html.
X Bruyn, Sander de, Chris Jongsma, Bettina Kampman, Benjamin Görlach, and Jan-Erik Thie. 2020.
Energy-Intensive Industries: Challenges and Opportunities in Energy Transition. European Parliament.
https://www.europarl.europa.eu/RegData/etudes/STUD/2020/652717/IPOL_STU(2020)652717_EN.pdf.
X Charoensuthipan, Penchan. 2022. “Doubt Raised over Labour Plan”. Bangkok Post, 10 April 2022.
https://www.bangkokpost.com/thailand/special-reports/2296134/doubt-raised-over-labour-plan.
X Chen, C., I. Noble, J. Hellmann, J. Coffee, M. Murillo, and N. Chawla. 2015. “University of
Notre Dame Global Adaptation Index”, Country Index Technical Report. https://gain.nd.edu/
assets/254377/nd_gain_technical_document_2015.pdf.
X Colijn, Bert, and Franziska Biehl. 2022. “Eurozone Labour Market: From Short-Time to
Shortfalls”. ING, 19 July 2022. https://think.ing.com/articles/eurozone-labour-market-from-short-
time-to-shortfalls.
X de Bel Air, Francois. 2019. Demography, Migration, and Labour Market in Kuwait. Gulf Labour
Markets and Migration. https://gulfmigration.grc.net/media/pubs/exno/GLMM_EN_2019_03.pdf.
X DTM (Displacement Tracking Matrix). 2021. “Climate and Migration in East and the Horn of
Africa: Spatial Analysis of Migrants’ Flows Data”, 16 August 2021. https://dtm.iom.int/reports/
climate-and-migration-east-and-horn-africa-spatial-analysis-migrants’-flows-data.
X EBRD (European Bank of Reconstruction and Development). 2022. “Regional Economic
Prospects”. https://www.ebrd.com/what-we-do/economic-research-and-data/rep.html.
X ECLAC (Economic Commission for Latin America and the Caribbean). 2022. “Growth Projections
for Latin America and the Caribbean 2022–2023”. https://www.cepal.org/sites/default/files/pr/
files/proyecciones_2022-2023_in.pdf.
X ECLAC and ILO. 2021. “Policies to Protect Labour Relations and Hiring Subsidies amid the
COVID-19 Pandemic”, Employment Situation in Latin America and the Caribbean No. 25 (LC/
TS.2021/163). https://repositorio.cepal.org/bitstream/handle/11362/47511/3/S2100694_en.pdf.
X European Commission. 2022. “State Aid: Commission Approves €450 Million German Measure
to Replace Electricity Generation amid Russian Natural Gas Shortages”, 30 September 2022.
https://ec.europa.eu/commission/presscorner/detail/en/IP_22_5919.
X GASTAT (General Authority of Statistics). 2022. “Labor Market Statistics, Q2 2022”. Kingdom of
Saudi Arabia. https://www.stats.gov.sa/en/814.
X Gatti, Roberta, Daniel Lederman, Asif M. Islam, Christina A. Wood, Rachel Yuting Fan, Rana
Lotfi, Mennatallah Emam Mousa, and Ha Nguyen. 2022. “Reality Check: Forecasting Growth in
the Middle East and North Africa in Times of Uncertainty”, MENA Economic Update. World Bank.
https://openknowledge.worldbank.org/handle/10986/37246.
X Heijmans, Philip. 2022. “Singapore Aims to Clear Foreign Labor Crunch in ‘Few Months’”.
Bloomberg, 2 March 2022. https://www.bloomberg.com/news/articles/2022-03-02/singapore-aims-
to-clear-foreign-worker-shortage-in-few-months#xj4y7vzkg.
X Hollinger, Peggy, Sarah White, Madeleine Speed, and Marton Dunai. 2022. “Will the Energy
Crisis Crush European Industry?” Financial Times, 18 October 2022. https://www.ft.com/
content/75ed449d-e9fd-41de-96bd-c92d316651da.
X ILO. 2018a. “The Employment Impact of Climate Change Adaptation”, Input Document for the
G20 Climate Sustainability Working Group. https://www.ilo.org/wcmsp5/groups/public/---ed_emp/
X ———. 2018b. World Employment and Social Outlook 2018: Greening with Jobs. https://www.ilo.
org/global/publications/books/WCMS_628654/lang--en/index.htm.
X ———. 2019. Working on a Warmer Planet: The Effect of Heat Stress on Labour Productivity
and Decent Work. https://www.ilo.org/wcmsp5/groups/public/---dgreports/---dcomm/---publ/
X ———. 2020a. Asia–Pacific Employment and Social Outlook 2020: Navigating the Crisis towards a
Human-Centred Future of Work. https://www.ilo.org/asia/publications/WCMS_764084/lang--en/
index.htm.
X ———. 2020b. “Protecting Migrant Workers during the COVID-19 Pandemic: Recommendations
for Policy-Makers and Constituents”, ILO Policy Brief. https://www.ilo.org/wcmsp5/groups/public/-
--ed_protect/---protrav/---migrant/documents/publication/wcms_743268.pdf.
X ———. 2022a. World Employment and Social Outlook: Trends 2022. https://www.ilo.org/global/
X ———. 2022b. “Advancing Social Justice and Decent Work in Rural Economies”, ILO Policy Brief.
https://www.ilo.org/wcmsp5/groups/public/---ed_dialogue/---sector/documents/briefingnote/
wcms_858195.pdf.
X ———. 2022c. Weak Growth and the Global Crisis Are Holding Back the Recovery of the Employment
in Latin America and the Caribbean. https://www.ilo.org/wcmsp5/groups/public/---americas/---ro-
lima/documents/publication/wcms_854778.pdf.
X ———. 2022d. Global Employment Trends for Youth 2022: Investing in Transforming Futures for
Young People. https://www.ilo.org/global/publications/books/WCMS_853321/lang--en/index.htm.
X ———. 2022e. “Employment in Myanmar in the First Half of 2022: A Rapid Assessment”, ILO
Brief. https://www.ilo.org/asia/publications/issue-briefs/WCMS_852682/lang--en/index.htm.
X ———. 2022f. Asia–Pacific Employment and Social Outlook 2022: Rethinking Sectoral Strategies for
a Human-Centred Future of Work. https://www.ilo.org/asia/publications/WCMS_862410/lang--en/
index.htm.
X ———. 2022g. ILO Monitor on the World of Work. 10th Edition. Multiple Crises Threaten the Global
Labour Market Recovery. https://www.ilo.org/wcmsp5/groups/public/---dgreports/---dcomm/---
publ/documents/briefingnote/wcms_859255.pdf.
X ———. 2022h. “The Impact of the Ukraine Crisis on the World of Work: Initial Assessments”,
ILO Briefing Note. https://www.ilo.org/europe/publications/WCMS_844295/lang--en/index.htm.
X ———. Forthcoming. “Resumption of Labour Migration and Regional Cooperation: Thematic
Background Paper for the 15th ASEAN Forum on Migrant Labour”.
X IMF (International Monetary Fund). 2022a. World Economic Outlook, Update: Gloomy and More
Uncertain. https://www.imf.org/en/Publications/WEO/Issues/2022/07/26/world-economic-outlook-
update-july-2022.
X ———. 2022b. World Economic Outlook: Countering the Cost-of-Living Crisis. https://www.imf.org/
en/Publications/WEO/Issues/2022/10/11/world-economic-outlook-october-2022.
X ———. 2022c. Regional Economic Outlook, Sub-Saharan Africa: Living on the Edge. https://www.
imf.org/en/Publications/REO/SSA/Issues/2022/10/14/regional-economic-outlook-for-sub-saharan-
africa-october-2022.
X ———. 2022d. World Economic Outlook: War Sets Back the Global Recovery. https://www.imf.org/
en/Publications/WEO/Issues/2022/04/19/world-economic-outlook-april-2022.
X INE (Instituto Nacional de Estadística). 2022. “INEbase: Industry, Energy and Construction”.
https://www.ine.es/dyngs/INEbase/en/categoria.htm?c=Estadistica_P&cid=1254735570688.
X IRENA (International Renewable Energy Agency). 2020. “Energy Innovation for a Green
Recovery in Africa”, 14 September 2020. https://www.irena.org/newsroom/articles/2020/Sep/
Energy-Innovation-for-a-Green-Recovery-in-Africa.
X Lee, Liz, Rozanna Latiff, and Mei Mei Chu. 2022. “Malaysia Firms Turn Down Orders as Migrant
Labour Shortage Hits”. Reuters, 13 June 2022. https://www.reuters.com/world/asia-pacific/
malaysia-firms-turn-down-orders-migrant-labour-shortage-hits-2022-06-13/.
X MacDonald, Fiona. 2022. “One of the World’s Wealthiest Oil Exporters Is Becoming Unlivable”.
Bloomberg, 16 January 2022. https://www.bloomberg.com/news/articles/2022-01-16/kuwait-a-
wealthy-oil-exporter-is-becoming-unlivable.
X ManpowerGroup. 2022a. “The United States’ Talent Shortage”. https://go.manpowergroup.com/
hubfs/Talent%20Shortage%202022/MPG_2022_TS_Infographic-US.pdf.
X ———. 2022b. “Canada’s 2022 Talent Shortage”. https://go.manpowergroup.com/hubfs/
Talent%20Shortage%202022/MPG_2022_TS_Infographic-Canada.pdf.
X Mati, Amine, and Sidra Rehman. 2022. “Saudi Arabia to Grow at Fastest Pace in a Decade”. IMF,
17 August 2022. https://www.imf.org/en/News/Articles/2022/08/09/CF-Saudi-Arabia-to-grow-at-
fastest-pace.
X PSA (Planning and Statistics Authority). 2020. “Qatar Census 2020: Economic Characteristics
of the Population”. State of Qatar. https://www.psa.gov.qa/en/statistics1/StatisticsSite/Census/
Census2020/res/Pages/economic.aspx.
X Stemmler, Henry. 2022. “The Effects of COVID-19 on Businesses: Key versus Non-key Firms”,
ILO Working Paper No. 77. https://www.ilo.org/wcmsp5/groups/public/---dgreports/---inst/
X UNCTAD (United Nations Conference on Trade and Development). 2022. Trade and Development
Report 2022. Development Prospects in a Fractured World: Global Disorder and Regional Responses.
https://unctad.org/system/files/official-document/tdr2022_en.pdf.
X UNDESA (United Nations Department of Economic and Social Affairs). 2022. World Population
Prospects 2022.
X UNHCR (United Nations High Commissioner for Refugees). 2022. “Operational Data Portal:
Ukraine Refugee Situation”. https://data.unhcr.org/en/situations/ukraine.
X US Bureau of Labor Statistics. 2022. “Economic News Release: Job Openings and Labor Turnover
Summary”, 30 November 2022. https://www.bls.gov/news.release/jolts.nr0.htm.
X Warren, Marcus. 2022. “Regional Economic Prospects, September 2022: A Cold Winter Ahead.
Confronting the Energy Crisis”. EBRD, 28 September 2022. https://www.ebrd.com/news/2022/
reduced-gas-supplies-and-inflation-to-slow-growth-further-in-ebrd-regions.html.
X World Bank. 2020. Convergence: Five Critical Steps toward Integrating Lagging and Leading Areas in
the Middle East and North Africa. https://openknowledge.worldbank.org/handle/10986/33187.
X ———. 2022a. “The World Bank in Africa: Overview”, 13 April 2022. https://www.worldbank.org/
en/region/afr/overview.
X ———. 2022b. Global Economic Prospects, June 2022. https://openknowledge.worldbank.org/
handle/10986/37224.
X ———. 2022c. G5 Sahel Region Country Climate and Development Report. https://openknowledge.
worldbank.org/handle/10986/37620.
X ———. 2022d. “Uneven Recovery in Latin America and the Caribbean: Are Women Being Left
Behind?” Working Paper. https://openknowledge.worldbank.org/handle/10986/37685.
X ———. 2022e. Gulf Economic Update: Achieving Climate Change Pledges. https://www.worldbank.
org/en/country/gcc/publication/gulf-economic-update-achieving-climate-change-pledges.
X ———. 2022f. Reforms for Recovery: East Asia and Pacific Economic Update, October 2022. https://
www.worldbank.org/en/publication/east-asia-and-pacific-economic-update#5.
X ———. 2022g. “South Asia: Overview”, 6 October 2022. https://www.worldbank.org/en/region/
sar/overview.
X ———. 2022h. South Asia Economic Focus. Reshaping Norms: A New Way Forward. https://www.
worldbank.org/en/region/sar/publication/south-asia-economic-focus.
X ———. 2022i. Europe and Central Asia Economic Update: Social Protection for Recovery. https://
www.worldbank.org/en/region/eca/publication/europe-and-central-asia-economic-update.
X ———. 2022j. Europe and Central Asia Economic Update, Fall 2022: Social Protection for Recovery.
https://openknowledge.worldbank.org/handle/10986/38098.
3
Global productivity
trends: Reviving
growth through the
digital economy?
X Macroeconomic challenges
in a global environment
of low productivity growth
Sustained productivity growth is essential to raising incomes

and sustaining well-being, constituting the linchpin of a just
transition. Provided the right labour market institutions are in place,
rising output per worker and per hour worked translates into higher
wages and generally leads to higher employment growth in the long
run.1 Steady productivity growth provides governments with the
necessary policy space to implement social and economic policies
that can reduce inequalities, open opportunities for their citizens
and improve many other non-monetary aspects of people’s well-
being, such as shorter working time, occupational safety and health
and universal social protection. Higher productivity levels can also
support a just transition to a net-zero economy, providing resources
1 See, among others, Semmler and Chen (2018), Autor and Salomons (2017),
Benigno, Ricci and Surico (2015), Nordhaus (2005) and Walsh (2004).
for environmental protection and d ecarbonization.2 find themselves confronted with a productivity
Policymakers and social partners therefore have a slowdown (Goldin et al., forthcoming).
shared interest in establishing a macroeconomic
Raising labour productivity growth is an important
and institutional environment in which productivity
factor in a country’s development path. EMDEs with
growth is facilitated and such productivity gains
historically higher productivity growth rates have
are shared in a socially just manner.
demonstrated greater success in reducing poverty
Productivity growth is not an end in itself. Higher and improving other social indicators. Evidence
productivity only means that, on average, more in this chapter indicates declining productivity
economic output is provided per worker.3 Many growth rates in EMDEs, at least since 2010, ren-
other aspects of well-being, including environ- dering the past decade disappointing in terms of
mental sustainability, are not captured by labour raising and equalizing living standards globally
productivity measures; institutional mechanisms (Dieppe 2021; figures 3.3 and 3.4). Clearly, higher
such as adherence to international labour stand- productivity growth rates by themselves do not au-
ards and social dialogue, among others, are tomatically improve social well-being. High labour
needed to enable a fair and wide distribution of productivity per se is neither equivalent to nor a
productivity gains across society. A lack of or a sufficient condition for social justice or sustainable
sluggish increase in productivity gains will limit the development, since other factors that are not the
possibilities of sharing such gains. Low-productivity main focus of this chapter play important roles,
growth is therefore an obstacle to social justice such as the UN Sustainable Development Goals
(see Chapter 1). (SDGs) on health, gender equality and sustainable
consumption, among others.4
The current long-term trend of falling product-
ivity growth rates observed across large parts of The macroeconomic environment fundamen-
the world is posing challenges for policymakers. tally changed during 2022 and the outlook
This productivity growth slowdown – initially a for 2023 is rather bleak. Declining labour
phenomenon of the developed world, starting after productivity growth rates now exist in a global
the second oil price shock in the early 1980s – has macroeconomic environment that is drastically and
become a widespread concern across all regions rapidly changing. Another decade of persistently
and country income levels (see figures 3.2 and low productivity growth on a global scale could
3.3). The factors behind this secular decline have exacerbate the already challenging macroeco-
been debated, and the widespread decrease in nomic situation (ILO 2022a). While most countries
growth rates has been dubbed a paradox, since it is are still struggling with the economic and social
consequences of the COVID-19 pandemic and the
occurring despite the rapid development and avail-
countermeasures implemented, several macroeco-
ability of new technologies. Globally, the trajectory
nomic key indicators have changed course.
of labour productivity growth did accelerate slightly
from 1990 until the global financial and economic First, a toxic mix of factors has triggered persistent
crisis (GFEC) of 2009, allowing several emerging and inflationary pressures (OECD 2022). COVID-19
developing economies (EMDEs) to narrow the gap measures have limited the movement of people
vis-à-vis advanced economies in terms of material and goods, thereby disrupting supply chains
living standards (see OECD 2015; figures 3.1, 3.2 and and imposing additional compliance costs on
3.3). And yet today virtually all major economies enterprises. China’s “zero COVID” policy has led
2 Economic development and environmental pollution follow an environmental Kuznets curve, where pollution increases at low
levels of economic development and falls after a certain threshold has been reached. Sustained productivity growth is essential
to reach this threshold and to continue the delinking of economic growth from environmental damage, including decarbonization
of the economy. For in-depth discussions on these issues, see Chen, Ma and Valdmanis (2021), Wang, Zhu and Zhang (2021),
Wang, Assenova and Hertwich (2021) and Badulescu et al. (2020).
3 “Labour productivity” in this chapter generally refers to GDP per worker, unless otherwise noted. Box 3.1 offers a detailed
discussion of different productivity measures, their respective interpretations and their limitations.
4 https://www.ilo.org/global/topics/sdg-2030/targets/lang--en/index.htm. Target 8.2 of the UN’s SDGs explicitly mentions product-
ivity as a goal: “achieve higher levels of economic productivity through diversification, technological upgrading and innovation,
including through a focus on high-value added and labour-intensive sectors”. Productivity also features under SDG 2, on zero
hunger (target 2.3), where there is a goal to double by 2030 the agricultural productivity and incomes of vulnerable small-scale
food producers.
3. Global productivity trends: Reviving growth through the digital economy? 89
to repeated regional lockdowns, which have order of magnitude is likely to become increasingly
ramifications not only for China but also for the difficult in a low-productivity growth environment.
rest of the world, since China is an important Another striking fact is that international economic
supplier of finished and unfinished goods and crises appear to have become more frequent over
components. Second, the conflict in Ukraine the last 30 years. It remains an open question
and related geopolitical tensions and economic whether the economic system has become more
sanctions have led to a spike in energy and food vulnerable to repeated negative shocks that flatten
prices, and shortages of certain commodities. the world’s growth trajectory and impede labour
The latter have already led to production delays productivity growth.
in various sectors, for example in construction.
As a consequence, economic growth has already
Third, in response to inflationary pressures, central
slowed down and is expected to remain sluggish
banks around the world have started tightening
throughout 2023 (IMF 2022; OECD 2022). Sovereign
their monetary policies and raising short-term
debt financing, corporate credit, and mortgages
interest rates. Central banks find themselves in a
have become more costly. It is possible that the
dilemma: the need to tighten monetary policies to
historic low-interest environment has come to an
bring down inflation at the price of higher financing
end. Together with rising inflation and demands
costs for enterprises, households and governments
for higher wages, which may at least compensate
could potentially lead to a severe recession. Higher
workers for real wage losses, these new conditions
financing costs through higher interest rates also
create significant challenges for enterprises, house-
mean that opportunity costs of investments for
holds and workers, and governments alike. Steep
enterprises are rising, rendering some investments
increases in the price of energy and food are likely
unprofitable. Fourth, in advanced economies,
to cause hardship, especially for low-income house-
several sectors have started seeing labour
holds, and to raise serious food security risks in the
shortages. Examples are the healthcare sector,
world’s poorest economies (OECD 2022). Higher
tourism, air transport and logistics. In some of
labour productivity growth could facilitate wage
these services sectors a combination of low wages,
increases and alleviate the inflationary pressures
a lack of decent working conditions, and an ageing
facing enterprises and workers.
population have made it increasingly difficult to
attract and find workers. Such shortages restrict These developments draw renewed attention to
countries’ capacity to expand their aggregate supply the fact that productivity growth rates in many
of goods and services, possibly fuelling inflation. economies are low and in many cases have been
declining for decades. It will become increas-
Finally, governments and enterprises have
ingly difficult for enterprises with low product-
committed themselves to drastic reductions in
ivity growth to survive in the current market
greenhouse gas emissions in a relatively short
environment. Low productivity growth will limit
time span. Achieving these targets will require
workers’ opportunities to earn higher wages and
massive investments in new production processes
improve the material well-being of their house-
and new infrastructure, without many visible
holds. It may become impossible for governments
economic returns in the short and medium run.
to facilitate large-scale economic transformation
There is little consensus on the expected near-term
if only small productivity gains can be harvested.
macroeconomic consequences of climate change
mitigation policies (IMF 2022). Some estimations This chapter reviews and discusses long-term
predict massive macroeconomic benefits after trends in labour productivity growth across the
2050, while others estimate that global GDP growth world. Empirical evidence presented here shows
will first decline by at least 0.15 to 0.25 percentage that many countries and regions are struggling
points annually (IMF 2022).5 Whatever the future to foster and maintain high labour productivity
macroeconomic benefits or costs of the green growth rates. The productivity slowdown that
transition may prove to be, large investments started decades ago as a phenomenon of advanced
are needed,6 and the allocation of funds of this economies is now affecting virtually all countries.
5 See, for example, https://www.oxfordmartin.ox.ac.uk/news/decarbonise-energy-to-save-trillions/.

6 For example, the IMF estimates that US$3–6 trillion per year are needed until 2050 (Georgieva and Adrian 2022).
The availability and fast advances of digital tech- once they are obtained. Such labour market fac-
nologies, on the one hand, and the productivity tors are often underemphasized in debates about
slowdown, on the other, have been perceived by productivity and merit greater attention.
many as a paradox. Does the problem lie at the
frontier – in that digital technologies are failing to Technology and investments in technology can
deliver the scale of economic benefits that other only deliver higher productivity growth if they are
technologies were able to deliver in the past – or accompanied by investments in people. Combined
do other barriers exist that prevent the generation efforts to substantially strengthen investments
and wide distribution of productivity gains? In this in the right technology and in people could be a
regard, the chapter emphasizes the importance of way to lift productivity growth back to levels that
labour market factors as key drivers of labour were achieved in the past. The analysis of labour
productivity growth, in both advanced and de- market factors also relates to policies that are at
veloping economies. Labour market institutions the core of the ILO’s mission, which, among other
and labour market policies are essential not only things, includes safeguarding labour market insti-
for increasing productivity growth, but also for tutions’ fundamental role of creating not only more
ensuring a just distribution of productivity gains equitable but also more efficient labour markets.
XProductivity trends across the globe

and structural shifts
Productivity is the ratio of economic output to Under similar conditions and over the long run,
economic input (see box 3.1). Rising output per countries at lower levels of economic development
worker at the country level is an important driver are expected to catch up with advanced economies
of living standards. In 2021, an average worker in a via higher productivity growth.7 Empirically, how-
high-income country produced US$104,295 (PPP), ever, this is not what the data show. Looking at
compared with US$5,705 for an average worker in longer time horizons and comparing the ratios of
a low-income country. This means that workers in output per worker across different regions between
high-income countries were about 18 times more 1970 and 2020 reveals that many developing coun-
productive than those in low-income countries. tries have failed to catch up with more advanced
In 1991, the ratio stood at 14, but between 1991 regions. In other words, developing countries
and 2021 labour productivity increased by around are not converging with advanced countries, at
US$33,000 (PPP) in the high-income group and least not on a large scale and not with sufficient
by only around US$800 in low-income countries. pace. Patel, Sandefur and Subramanian (2021) find
Thus, labour productivity grew by 46 per cent in evidence that per capita growth of lower-income
high-income countries and by a mere 16 per cent countries slightly accelerated after 1995 vis-à-vis
in low-income countries in that 30-year period. countries with higher incomes (beta convergence),
Middle-income countries were, on average, more but they also estimate that it would take a typical
successful in closing this productivity gap. In developing country approximately 175 years to
1991, a worker in a high-income country was five close half the productivity gap with a typical ad-
to six times more productive than a worker in an vanced economy. Use of the United States’ GDP
upper-middle-income country (down to two and a per capita as a benchmark confirms the lack of
half times in 2021) and seven to eight times more convergence across regions (see figure 3.1).
productive than a worker in a lower-middle-income
country (down to five times in 2021).
7 Economic growth literature makes use of the concepts of beta- and sigma-convergence. The first analyses whether poor countries
or regions will catch up with rich ones and describes the rate at which countries are converging. The second concept looks at
income inequalities or differences among countries or regions and analyses whether the dispersion of income distribution is
shrinking or not (for example, Furceri 2005).
X Box 3.1. Productivity: Measurement and key concepts

Productivity indicates the amount of output produced from a certain amount of inputs. Paul
Krugman (1992) famously asserted that “productivity is not everything, but in the long run, it’s
almost everything”. The enhancement of productivity is essential for there to be sustainable enter-
prises and decent jobs – both core elements of any development strategy whose main objective
is the improvement of people’s lives (ILO 2020a).
Labour productivity is one of the most widely used indicators, together with total factor product-
ivity (TFP).1 Its level and evolution over time depend on the availability of other inputs – such as
different forms of capital – and the technology used to combine labour and capital to produce
output. Labour productivity can be directly measured using widely available national accounts
and labour market variables.
However, the working definition of “labour productivity” used in this chapter is not without limita-
tions. We employ the most standard characterization of labour productivity, based on a definition
of output in which the potential negative externalities inherent to production processes, such
as impacts on the environment, are not accounted for. There is a need for better valuing the
contribution of unpaid household and other work for which no market value is available or for
which these values need to be estimated, as is the case in many (public) services sectors. Moreover,
many economic activities would not be feasible without the essential inputs provided by the natural
world. These “ecosystem services” are typically under- or unvalued, creating incentives for overuse
(the so-called “tragedy of the commons”). Valuing such “natural capital” has become the subject
of active research and international standard-setting; the UN is leading the effort to establish a
fully integrated economic and environmental account system.2
These issues affect both the output and input sides of productivity measurement, and we
acknowledge their importance. In fact, mismeasurement has even been proposed as a major
explanation of the slowdown. This hypothesis stresses that productivity gains are not captured
properly in available economic statistics. 3 However, Byrne, Fernald and Reinsdorff (2016) and
Syverson (2017) conclude that this phenomenon would only be large enough to explain a relatively
small proportion of the post-GFEC slowdown in overall productivity growth. The current consensus
seems to be that mismeasurement alone cannot explain the full extent of the productivity puzzle
(European Commission 2020).
The international community is making gradually more efforts to collect and estimate data that
will permit more robust analyses in future.
. For an extended discussion, including technical aspects, of the different measurements used and the caveats
1
around them, please see Appendix E. 2. See https://seea.un.org/. 3. See Syverson (2017) and Feldstein (2017)
for in-depth explorations of the issue of mismeasurement, including prices and value added in services sectors,
which are especially difficult to measure (for example, free online services).
The developing world has not been able to close as by Central and Eastern Europe and Central Asia
the productivity gap with advanced economies. since the early 2000s. On the other hand, Latin
Figure 3.1(a) reveals that over more than half a America has continuously diverged from the
century only a few regions have managed to move productivity levels of the United States since the
closer to the level of productivity in the United early 1980s. Western Europe had almost caught
States.8 It shows that significant improvements up with living standards in the United States by the
have been made by China since the 1980s, as well 1990s but has been diverging since then; its labour
8 These regions do not coincide with the ILO regions and subregions used elsewhere in this chapter.
X Figure 3.1. Labour productivity convergence across geographic regions,

China and country income groups
(a) Output per worker relative to the United States (US = 100) (b) Coefficient of variation of output per worker
100 1.06
1.04
80 1.02
1.00
0.98
60
0.96
0.94
40
0.92
0.90
20 0.88
0.86
0.84
0 1974 1982 1990 1998 2006 2014 2022 1995 2000 2005 2010 2015 2020
Western Europe Oceania Latin America World Low- and high-income countries
Central and Eastern Europe and Central Asia Middle- and high-income countries
Asia China Africa
Note:Output per worker is measured as GDP per worker in PPP terms. The data for each geographical and country income
group are obtained by computing the weighted average output per worker across countries in each group. The country
weights used are the real GDP shares of each country in each group. The coefficient of variation is a measure of the relative
dispersion of labour productivity among the countries in each of the three country income groups shown. The figure shows the
three-year rolling average of the coefficient of variation. A decline over time indicates that the respective labour productivity
levels of all countries in the sample are approaching each other (sigma convergence). For the world as a whole, such a decline
can be observed over the last years of the period but is largely driven by developments in middle-income countries.
Source:The Conference Board (figure 3.1(a)) and ILOSTAT, ILO modelled estimates, November 2022 (figure 3.1(b)). The
Conference Board regions do not coincide with ILO regions. For the list of countries in each region in the Conference Board
dataset, see https://www.conference-board.org/data/economydatabase/total-economy-database-methodology.
productivity level is currently around 25 per cent reduce the productivity gap, cannot be explained
lower than that of the United States. To illustrate by such strongly accelerating productivity growth
the magnitude of the challenges: even China, which in advanced economies (figure 3.2; OECD 2015 and
successfully raised its labour productivity closer 2019a; Dieppe 2021). The sustained productivity
to advanced economies’ levels, would require gap between high- and low-income countries
another 24 years to surpass the United States’ exists in an environment in which productivity
labour productivity levels (measured in 2021 PPP growth rates are generally low relative to the past.
international dollars) if both economies were In fact, the slowdown in aggregate productivity
to grow at the same average growth rate they growth is evident for G7 countries between
achieved in the period from 2012 to 2021. 1953 and 2021. Despite a short period of revival
This lack of convergence is even more sur- during the 1990s, productivity growth has trended
prising in that productivity growth rates in downwards, even approaching zero in some cases.
advanced economies have been stagnating or For the period between the mid-1990s and 2019,
even falling for decades. Thus the failure of many Patel, Sandefur and Subramanian (2021) point
developing countries to catch up, or at least to to evidence of a slow convergence on a global
X Figure 3.2. Long-term labour productivity growth: G7 countries versus Brazil, China and India
(percentages)
10 10
8 8
6 6
4 4
2 2
0 0
–2 –2
1960 1970 1980 1990 2000 2010 2020 1960 1970 1980 1990 2000 2020
Japan Germany Italy France Brazil China India

Canada United States United Kingdom
Note:The growth rates shown have been smoothed using a Hodrick–Prescott filter. This detrending technique is sensitive to
the end points of the series. This, however, does not influence the overall direction of the trend. The period 2020–22 is excluded
because of the strong interference of the COVID crisis in the trend dynamics.
Source:The Conference Board.
level. But, as shown in figure 3.1 and discussed of the G7 countries, it has sharply slowed down in
below, this development is strongly influenced recent times and has done so even faster than in
by a number of successful middle-income coun- the latter countries. Furthermore, the significant
tries and does not change the fact that nearly all increase in productivity growth between 1990
countries are now experiencing a very low scale and 2010 did not occur in all EMDEs. For example,
of labour productivity growth. Brazil has followed a downward path similar to that
of advanced economies, with only a temporary
At the global level, the picture is a bit more nu-
upswing around the GFEC. Labour productivity
anced. Global labour productivity growth acceler-
growth in EMDEs has also been more volatile and
ated from 1990 until the onset of the GFEC in 2009.
heterogeneous since the 1980s than in advanced
This development reflected strong productivity
economies, where the decline has been relatively
growth in several emerging market economies,
homogeneous (Dieppe 2021).
which more than offset the slowdown in the G7
and Organisation for Economic Co-operation and As can be seen in figures 3.2 and 3.3, the slowdown
Development (OECD) countries. Nevertheless, in labour productivity growth became ubiquitous in
even these EMDEs that enjoyed higher labour the past decade and is by now afflicting the entire
productivity growth rates in the past are now also globe. One reason for this might be that the stag-
subject to stagnating or even slowing productivity nation in advanced economies exerts a negative
growth. This stagnation began shortly after the effect on the productivity outlook in less developed
GFEC, as illustrated by the experiences of China economies, especially at a time when the latter are
and India. Although China’s labour productivity running out of policy space as a consequence of
growth used to be significantly higher than that international fiscal and monetary shocks.
X Figure 3.3. Average labour productivity growth in different ILO regions and countries,
selected periods (percentages)
10.0
7.5
5.0
2.5
–2.5
NAF SSA LAC NAM EA SEAP SA NSWE EE CWA AS China US World
1992–2001 2002–11 2012–21
Note:Growth rates for each geographical group are the weighted average of the growth rates of the countries
in each group. NAF: North Africa; SSA: sub-Saharan Africa; LAC: Latin America and the Caribbean; NAM: North
America; EA: East Asia; SEAP: South-East Asia and the Pacific; SA: South Asia; NSWE: Northern, Southern and
Western Europe; EE: Eastern Europe; CWA: Central and Western Asia; AS: Arab States.
Source:Authors’ calculations based on ILOSTAT, ILO modelled estimates, November 2022.
Labour productivity growth in most regions productivity and well-being, concluding that
fared relatively well in the first decade of this productivity growth – and the higher incomes and
century, followed by a substantial decline over government revenues arising from it – contributes
the past ten years. The only region in which to higher levels of objective measures of material
labour productivity growth in the past decade well-being, especially in developing countries. The
was higher than in the previous two decades was most important channel through which product-
North Africa, although its performance during the ivity growth enhances well-being is by generating
previous two decades was rather poor, with growth real income gains, both for workers in the form of
rates well below 2 per cent. All other ILO regions real wages and for owners of capital through higher
experienced a large setback in productivity growth profits. Real income growth, in turn, boosts tax rev-
over the past decade. The persistent slowdown in enue, which can be spent on public infrastructure
advanced economies, with progressively declining and services and on transfer payments. The link
growth rates in Northern, Southern and Western between productivity growth and well-being has,
Europe and the United States, is clearly visible in however, been weakening in recent decades, owing
figure 3.3. Only a few countries have managed to both the slowdown in productivity growth and
to catch up with the latter; China, South Asia and the decoupling of productivity from median wages
East Asia have had sustained periods of higher (Sharpe and Mobasher Fard 2022). The same study
productivity growth, whereas Eastern Europe and finds that well-being is also a driver of productivity.
Central and Western Asia had only partial success For instance, heightened levels of well-being are
in this respect.
associated with higher social capital, which pro-
Productivity growth is one of the most im- motes trust in society. Trust has been shown to
portant drivers of economic and social well- correlate positively with productivity. Wellness
being. Sharpe and Mobasher Fard (2022) offer programmes can also contribute to productivity
an analysis of the two-way linkages between by improving workers’ well-being.
X Figure 3.4. Labour productivity, informality, and working poverty
(a) Informality
100
80
Informality rate
60
40
20
0
0 10 000 20 000 30 000 40 000 50 000 60 000 70 000 80 000 90 000 100 000
GDP per worker
(b) Working poverty
100
80
Working poverty rate
60
40
20
0
0 5 000 10 000 15 000 20 000 25 000 30 000 35 000 40 000 45 000 50 000
GDP per worker
Note:Labour productivity expressed in 2017 PPP international dollars. Informality and working poverty rates
expressed in percentages of total employment. Scatterplots obtained using pooled year–country data for both
indicators and labour productivity. The two samples include different countries and time periods, owing to
limited data availability. Outliers beyond the 99th and 1st percentiles of the distribution of labour productivity
have been excluded.
Source:Authors’ calculations based on ILOSTAT.
As specific examples of the link between product- that is, more sophisticated production methods,
ivity and different facets of well-being, figure 3.4 including process innovations that may, for ex-
displays the negative correlation between labour ample, consist of better management techniques;
productivity and the incidence of informality and and (iii) labour composition, that is, a better-skilled
working poverty. Causality between product- workforce (Dieppe 2021). The sectoral composition
ivity and informality may run in both directions. of the economy also plays an important role in
However, low firm-level productivity limits the determining aggregate productivity growth in a
potential – by implying higher unit costs – for particular country or region: the reallocation of
improved pay and working conditions, thereby workers to sectors or industries that are more
perpetuating informality. Moreover, firms in the productive raises labour productivity growth
informal sector may see low net benefits from for the economy as a whole. In contrast, if many
complying with the requirements of formalization workers flow into low-productivity activities, econ-
(OECD and ILO 2019). Raising productivity therefore omy-wide labour productivity growth declines.
plays a central role in any strategy to promote In other words, the structural composition of an
formal work, through actions in key domains such economy explains to a certain degree the labour
as education, innovation, business climate and productivity growth of the economy as a whole,
urban planning. and structural transformation can therefore be one
of the reasons explaining the slowdown.
That productivity growth is a key element in re-
ducing overall poverty rates is a well-established It is especially important to monitor such sec-
fact.9 As figure 3.4(b) shows, working poverty toral shifts in employment in developing coun-
declines as labour productivity increases. Among tries, where structural transformation plays a
small and medium-sized enterprises in developing significant role (ILO 2022b). Industrialization, in
countries, Vandenberg (2004) finds that lower the form of the expansion of a country’s manufac-
productivity often results in lower income for turing, mining and construction sectors, is the
entrepreneurs and workers and thus contributes most commonly observed development path. This
to working poverty. Aside from policies to scale typically entails the reallocation of workers from
up firm size, the bolstering of workers’ rights and low-productivity activities, like subsistence farming
conditions – including through cooperative work or craftwork at home, to sectors with higher
practices – can be a cost-efficient way to increase productivity, such as industrialized manufacturing.
productivity.10 Productivity growth is essential Sectors with higher productivity usually pay higher
to fight poverty in low-income countries. Oseni, wages and can also offer better working condi-
McGee and Dabalen (2014) show that increases tions. In addition, this process often brings about
in agricultural productivity in Nigeria dramatically a transition from informal to formal jobs.
reduce the likelihood of being a poor worker, cor-
Growth accounting techniques in economics take
roborating the important links between product-
the overall labour productivity growth of a country
ivity, development and social justice goals.
(or other economic unit) and attempt to account
Labour productivity growth at the macroeco- for the contribution of (i) capital deepening (by
nomic level is the outcome of the interplay subtracting the amount of growth that can be
of economic factors within enterprises and attributed to the increase in capital), (ii) labour com-
industrial sectors. The explanatory factors position (changes in the workforce in terms of age,
behind productivity growth in an economy can sex and education) and (iii) a growth “residual” that
be roughly summarized as: (i) capital deepening, is typically associated with technological change
that is, more investment in machinery and equip- and innovation.11 Growth accounting requires data
ment per worker; (ii) technological innovations, about a country’s capital formation and its labour
9 See, for instance, Landmann (2004), who claims that “where poverty persists, it invariably does so because societies fail to deal
effectively with unemployment, low productivity and income inequality”.
10 See Betcherman (2015) for a discussion on productive employment and decent jobs as well as policies to achieve these objectives.
11 Solow (1957) laid out the theoretical foundations of growth accounting. For extended discussions of the application of this
methodology, see Barro (1999) and O’Mahony and Timmer (2009). This decomposition technique for labour productivity growth
depends on certain assumptions about the aggregate production function, and the practice of attributing the contribution of
“technological progress” to residual growth is subject to criticism.
force composition over long periods of time. This frequent crises that have occurred over the past
method is often used to gain insights regarding two decades (see box 3.2 on the impacts from the
the contributions of the three main components COVID-19 crisis), and also partly reflect growing
(capital deepening, labour force composition and economic uncertainty. Various factors have been
technological progress) to labour productivity discussed as contributing to greater uncertainty,
growth. Growth accounting helps us identify the including declining global trade and foreign
historical sources of growth in an ex post manner. direct investment inflows, heightened political
risk and adverse macroeconomic spillovers from
Gordon and Sayed (2019) show that, in the period
major economies.
1950–2015 in the United States about 20 to
40 per cent of labour productivity growth can The structural composition of the economy
be attributed to technological progress, about has an impact on productivity growth. Labour
50 to 60 per cent to capital deepening, and 7 to productivity growth evolves differently across
21 per cent to workforce composition (the size sectors (Baumol and Bowen 1966). If cross-sectoral
of the contributions of each component varying differences in labour productivity growth persist
within this time period). For the EU10, the esti- over longer periods of time, an increasing share of
mated numbers are comparable, with slightly employment will be concentrated in low-produc-
higher estimates for technological progress (more tivity sectors, ultimately dragging down aggregate
than 60 per cent) during the period 1950–70.12 productivity growth. Such a development has been
The contributions of technological progress are dubbed “Baumol’s cost disease” (Baumol 1967) and
estimated to be significantly higher in the earlier is partly responsible for the gradual slowdown
decades (1950–70) and very small during the 2000s. in productivity growth observed in advanced
Global investment has been weak in the economies. Nordhaus (2008) analyses different
aftermath of global shocks. Originating in the variants and mechanisms of Baumol’s cost disease
aftermath of major recessions in OECD economies, for the United States and calculates the extent to
slow investment growth has become a concern which sectoral shifts have tended to reduce overall
for many other regions in the world and is most productivity growth. Hartwig (2011) undertakes
pronounced in the largest emerging markets and an identical exercise for the case of the EU, again
in commodity exporters (OECD 2019a; Kose et al. finding a negative impact of structural change
2017). Figure 3.5 shows that investment in the stock on labour productivity growth. Duernecker and
of physical capital is highly correlated with labour Sanchez-Martinez (2022) confirm Hartwig’s results
productivity growth. The dots in figure 3.5(a) depict while also providing a model-based examination of
the corresponding average productivity growth the negative impact of structural change on future
and average investment levels for each of the productivity performance in the EU.
regions and time spans shown in figure 3.5(b). Most countries are primarily agriculture-based
Figure 3.5(b) compares investment intensity, in their initial stages of development. A gradual
measured as gross fixed capital formation as a
structural shift – at different speeds for different
share of GDP, over each period for each region.
countries and periods – then ensues, entailing
In advanced economies (Western Europe and
first a shift from agriculture to manufacturing and
United States), the productivity slowdown is clearly
then a shift from manufacturing to services. Some
accompanied by lower investment activity. In
analysts, however, have questioned this traditional
other regions, the picture is more nuanced, with
development path, noting that some countries are
investment intensity stagnating or declining in
bypassing the traditional shift from the primary to
some regions and showing increases in others.
the secondary sector and rapidly becoming service-
Persistently weak investment may partly owe based economies instead (Hallward-Driemeier
to the hysteresis effects stemming from the and Nayyar 2018). This process may not be to the
12 The EU10 includes all the EU Member States that joined before 2004. These numbers are meant to provide a rough idea of the
magnitudes of the three components generally used in growth accounting. Different studies in the literature obtain slightly
different estimates of these magnitudes, chiefly depending on the exact definition of labour productivity used, the growth
account factors considered and the underlying data sets used in the estimations. The numbers we provide are also in line with
those of Fernald and Inklaar (2020), who analyse in depth the different results for labour productivity growth stemming from
dissimilar growth-accounting approaches using different data sets.
X Figure 3.5. Labour productivity and investment (percentages)
(a) Labour productivity growth and investment (b) Investment as a proportion of GDP
6 30
20
Labour productivity growth
10
0 –10
0 1 2 3 4 5 6 7 8 9
NAF
LAC
NAM
SEAP
NSWE
EE
AS
SSA
EA
SA
CWA
Investment
1992–2001 2002–11 2012–21
Note:(a) present a scatterplot of the average labour productivity and the physical capital stock growth rates across the
same regions and same subperiods depicted in figure 3.3. The bars in (b) show the average levels of investment intensity
(investment over GDP, both in real terms) in the same subperiods and regions. Investment intensities by region are
obtained after computing the weighted sum of the investment intensities of the countries in each region. NAF: North Africa;
SSA: sub‑Saharan Africa; LAC: Latin America and the Caribbean; NAM: North America; EA: East Asia; SEAP: South‑East Asia and
the Pacific; SA: South Asia; NSWE: Northern, Southern and Western Europe; EE: Eastern Europe; CWA: Central and Western
Asia; AS: Arab States.
Source:Authors’ calculations based on Penn World Tables 10.0.
detriment of labour productivity growth, since, it A comparative decomposition analysis across

is argued, fast-growing services sectors, can, like different countries reveals that the most important
manufacturing, also lead to economic convergence contributor to growth in real output per worker in
between countries (Hallward-Driemeier and the period 1992–2018 was intrinsic productivity
Nayyar 2018). The progressively larger share of growth at the sectoral level.13 This means that the
the services sector in emerging and advanced bulk of labour productivity growth can be attrib-
economies is therefore a key issue to analyse in uted to factors unrelated to shifts in the sectoral
relation to the productivity growth slowdown. composition of economies and linked instead to the
A decomposition of aggregate productivity growth engines of productivity growth at the sectoral level,
into the contributions of sectoral growth rates, with such as technological advancements and skills
an emphasis on the productivity performance of development. There is a degree of heterogeneity
services sectors – distinguishing between private across countries; some EMDEs evince a greater
and public, business-to-business and business-to- positive contribution to productivity growth from
consumer services – is helpful to understanding sectoral shifts towards industries with higher levels
the role that structural change plays in determining of productivity, and some low-income economies
economy-wide productivity growth. exhibit a negative contribution from shifts towards
sectors with lower productivity growth profiles.
13 See Appendix F for graphical representations and an extended discussion of these decompositions.
X Box 3.2. The impact of the COVID-19 pandemic

Besides having caused a large number of countries to enter into recession, the pandemic may
also have entailed a further reduction in labour productivity growth in many countries. The
various policy measures implemented to curb the spread of the virus also had negative side effects
on the economy. Although some evidence suggests that the recession led in the short term to
productivity-enhancing reallocations of workers (Stewart 2022), concerns exist about the reces-
sion’s potential negative impact over the medium to long term. Hanushek and Woessmann (2020)
stress that students affected by school closures during the pandemic may obtain a 3 per cent
lower lifetime income unless catch-up measures are put in place. These authors estimate that
this could translate into a lower long-term level of output, through productivity losses, in nations
where education closures were most stringent. This could compound the problems observed in
the developing world in terms of global universal skills as well as increasing schooling gaps with
respect to advanced economies (Gust, Hanushek and Woessmann 2022; Dieppe 2021).
The OECD (2021) underlines that “policy measures during the pandemic may have protected viable
and productive firms and avoided the systemic risks posed by a wave of bankruptcies, but at the
risk of potentially keeping non-viable (zombie) firms afloat”.1 An excessively late exit of these firms
may hamper aggregate productivity growth in the longer run by preventing the channelling of
capital and labour towards new business opportunities.2 Finally, the potential scarring effects of the
crisis on the economic fabric is a widely debated issue that may impact the future prospects of
labour productivity growth.3 A report by the European Central Bank (2021) estimates that the level
of global potential output declined during the pandemic, while the Bank of Finland (2021) claims
that the crisis may leave longer-lasting scars than anticipated in such areas as employment, capital
stocks and productivity. De Vries, Erumban and Van Ark (2021) show that post-crisis productivity
growth does not exhibit a clear deviation from the slowing pre-pandemic trend; they add that its
future hinges on the relative strength of the productivity gains made in digitally intensive sectors
relative to the potential scarring effects of the crisis on labour markets and business dynamism.
All in all, hysteresis effects could take the form of persistently lower labour force participation,
low levels of investment and a slowdown in the reallocation of resources (Sanchez-Martinez and
Christensen 2022), which would amplify the already weak performance on these fronts observed
before the crisis. This could be especially the case in low-income and lower-middle-income coun-
tries whose GDP growth rates remain below pre-crisis levels.
1. For a working definition and taxonomy of “zombie firms”, see Banerjee and Hofmann (2020). 2. Most analysts
believe there will be a surge in the number of bankruptcy filings once the financial support measures are finally
lifted. Recent evidence for the United States shows that the largest ever weekly increase in small-business
bankruptcy filings was recorded in March 2022 (Chutchian 2022). The consequences in terms of employment
losses and other effects could be non-negligible. 3. Hysteresis effects are closely linked with protracted low
aggregate demand during crisis periods that leave permanent scars on the supply side of the economy. Summers
(2015) was one of the first to suggest that insufficient aggregate demand for long periods of time, especially in
advanced economies, is another possible main driver of the stagnation of labour productivity growth.
X Technology and labour market linkages
Growth in TFP, often interpreted as technological voices have raised concern that digitalization in
progress, is frequently identified as one of the combination with AI could lead to accelerated auto-
main drivers of productivity growth in long run. mation and hence the replacement of labour; see,
The expansion of capital (“capital deepening”), for example, Arntz, Gregory and Zierahn (2016),
that is, investment in physical assets that make Brynjolfsson and McAfee (2014), Frey and Osborne
workers more productive, is also a major driver (2017) and Brynjolfsson and Mitchell (2017). It is
of productivity. Importantly, both technological widely believed that such replacement should lead
progress and the expansion of capital seem to to faster labour productivity growth. However,
be playing a role in the slowdown (Gordon and despite the availability of digital technologies and
Sayed 2019; OECD 2015). The contributions of recent advances in AI, productivity growth has
labour market composition are found to be smaller slowed down, resulting in the modern “productivity
than those of these other two components. This puzzle” (see, among others, Brynjolfsson, Rock
latter finding is partly by construction, since many and Syverson 2019; European Commission 2020).
studies interpret the contribution of the labour
Digital technologies have the potential to
force narrowly, by defining it in terms of primary,
reinforce the links between people and
secondary and tertiary educational attainment,
technology. Many AI innovations are organizational,
thereby ignoring many other important aspects of
based on the broad idea of “knowing how to do
workforce composition such as training, learning
things differently”, or “better”, or “more efficiently”.14
on the job, and experience.
Some of these ideas may be reflected in measured
The three components of investment , economic value, in the form of intangible assets such
technological progress and workforce com- as patents or software. But often such know-how
position – broadly viewed as “human capital” – exists off the balance sheet, in the form of non-
cannot be separated. Investment needs to be patentable algorithms, or research expenses not
made into “something”, some physical form of considered assets because they mainly comprise
capital, and capital needs to be operated or man- investments in people or people’s capabilities.
aged by workers who are skilled in doing that. There is a growing literature in economics that
It is questionable whether there can really be attributes a significant role to intangible assets,
economy-wide technological progress without patents and other types of know-how, such as firms’
significant accompanying changes in the workforce training and management competencies, in the
and in organizations. Investments in new technol- explanation of productivity growth.
ogies and in people must therefore be seen as two
Investment in know-how – whether such invest-
sides of the same coin. Innovations do not often
ment is made in machines or in intangibles – can
stem from physical assets alone.
have positive effects on productivity only if
New digital technologies such as artificial workers have the education and the skills to
intelligence (AI) could play an important role utilize these assets. Even if labour-saving invest-
in reviving productivity growth (ILO 2022c). ment in a new machine is made, firm-level product-
AI in combination with other digital technologies ivity can increase only if the firm has or finds
is expected to have an enormous potential in workers with the skills to operate this machine.
labour-saving automation, thereby increasing On an economy-wide level, material well-being will
productivity (see box 3.3). The OECD (2020) rec- not increase through higher productivity growth
ognizes the strong potential of enhanced product- if replaced workers remain idle or unemployed
ivity through digitalization but acknowledges for long periods of time and cannot work in any
that productivity gains through digitalization at other productive way in the economy. Hence,
the aggregate level have not materialized. Some technological change as a driver of productivity
14 For a wide spectrum of innovation types and their implications for the labour market, including in relation to gender, see
Chapters 2 and 4 of ILO (2017).
X Box 3.3. Productivity growth and automation

One important mechanism through which digital technologies can drive productivity growth
is the replacement of work activities that have previously been carried out by workers. It has
long been argued that computers are primarily able to automate routine tasks (Autor, Levy and
Murnane 2003). The same idea is typically extended to the analysis of AI as a form of capital that
can be either a complement to or a substitute for (different types of) labour. Following the “task
approach to labour markets” propagated by Acemoglu and Autor (2011), Autor (2013) and others,
economic output at the micro level is generated by “tasks” and the boundary between “labour
tasks” and “capital tasks” is dynamically changing as technological capabilities evolve. Workers’
occupations and their actual jobs can be seen as bundles of tasks. Which task is carried out by
which production factor (capital or labour) depends, at each particular point in time, on the relative
economic cost of the two factors. Based on the machine–task substitution framework in Autor,
Levy and Murnane (2003), Autor (2013) suggests that the set of tasks most subject to machine
displacement are those that are routinary or codifiable. This is echoed by Frey and Osborne (2013),
who claim that the replacement of cognitive and manual routine tasks through capital is evident,
but that this potential for replacement needs to be extended to non-routine cognitive tasks in the
context of AI. The authors predict that any (even non-routine) task can be carried out by capital
so long as it is not subject to “engineering bottlenecks”, which they roughly group into three
categories: perception and manipulation tasks (or unstructured problems), creative intelligence
tasks and social intelligence tasks. What clearly emerges from this literature is that routine tasks
are most suitable for automation and the replacement of workers by machines. On the basis of
the task model, two empirical implications can be derived. First, industries and occupations that
make intensive use of labour in routine tasks will make relatively larger investments in computer
capital (Autor, Levy and Murnane 2003; Autor 2013). Hence capital investment and the adoption
of computers should be greater in these industries than in others. Second, the reassignment of
tasks from labour to capital should result in higher labour productivity.
is intrinsically connected to investments in human US$700 trillion, the equivalent of 11 per cent of
capital (in particular, skills and education), as dis- global GDP in net present value terms. This loss
cussed in the previous subsection. can be attributed to the key role that upgrading
the skills of the population plays in ensuring
Workforce skills and the need to make them
productivity improvements. In OECD economies,
more suited to the current and future context
a positive correlation between the effective use
of technological transformation is critical to
of skills and aggregate productivity has been
enhance the quality and quantity of output. ILO
solidly established.15
estimates on skill mismatches – the inadequacy of
workforce skills with respect to the demands of the The upgrading of workers’ skills (upskilling) and/
labour market – suggest that undereducation is a or adaptation of them to new processes and tools
significant challenge for low- and middle-income (reskilling) is essential to the implementation
countries, thereby explaining in large part their and diffusion of new technologies as well as
difficulties in catching up with the productivity the realization of productivity gains. Together
levels in high-income countries (see ILO 2019; with education, skills development is the most
figure 3.6). Closing this skill gap could yield sub- important pillar in the creation and preservation of
stantial gains in productivity. Gust, Hanushek and human capital. It includes traditional areas such as
Woessmann (2022), for instance, estimate that the management practices, organizational behaviour,
present value of worldwide economic output lost and work experience, as well as other skills that
to a lack of universal basic skills amounts to over have gained more prominence lately, such as
15 https://www.oecd-ilibrary.org/sites/5ac9bb58-en/index.html?itemId=/content/component/5ac9bb58-en.
need considerable time before their full impact

X Figure 3.6. Skills mismatches on the economy and society will become visible.16
by country income group (percentages) The more profound and far-reaching the potential
restructuring, the longer the time lag between the
100 invention of the technology and its effects. It takes
time to innovate and to test innovations, to find
80
business opportunities, to make sufficient invest-
ment and, eventually, to restructure processes to
make efficient use of the new technology.
60
Van Ark (2016) and Van Ark and Fleming (2022)
make a similar argument for digital technologies
40
more broadly. They distinguish an “installation
phase” from a “deployment phase”. During
20 the first phase, a handful of firms develop and
implement the technologies; this often gives
0
rise to winner-takes-all dynamics while the
World Low Lower- Upper- High technologies have yet to diffuse through the
income middle middle income
whole economic system. In the second phase,
income income
these new technologies develop general-purpose
Matched Overeducated Undereducated characteristics, become available at a lower cost
and hence cause breakthrough economic and
Source:Data from Stoevska (2021). social transformation. This is the phase when
productivity gains may materialize. Analysing
the period from 1999 to 2014 in industrialized
economies, Van Ark (2016) finds rapidly declining
cognitive, socio-emotional and manual skills (ILO information and communications technology (ICT)
2022d). It is not only the general availability of prices, a shift from ICT investment to ICT services,
skills in an economy that matters, but also the and a continuing increase in knowledge-based
efficiency of their allocation. Skill mismatches can assets that support ICT. It appears, nevertheless,
severely weigh on productivity growth (Adalet that – even in industrialized countries – many digital
McGowan and Andrews 2015). Both over- and technologies, in particular those relating to AI, may
underqualification are found to be associated still be in the installation phase.
with lower aggregate productivity growth. (Scarce)
For a subset of advanced economies, De Vries,
high-skilled labour can be inefficiently employed
Erumban and Van Ark (2021) show that it is indeed
within a firm or be trapped in a low-productivity
the most intensively digital-using sectors that are
firm. This latter point brings out the importance of
making the largest contribution to productivity
the ease with which workers can make transitions
growth at the aggregate economic level. In the
between firms, industries and occupations with
four advanced economies they examine, the least
a view to improving their career as well as their
intensively digital-using industries performed
employers’ prospects. The ILO (2021a) has analysed
worst in both absolute and relative terms. Van
the extent to which workers can flow within and
Ark and Fleming (2022) remark that achieving
across occupational groups in reaction to the
higher digital intensity across sectors chiefly
COVID-19 shock and technology shocks.
hinges on (i) the diffusion of new digital technol-
New technologies raise economy-wide product- ogies to productivity laggards, (ii) improvements
ivity only gradually, since they require comple- in the capacity of firms to absorb AI technology,
mentary organizational changes. Brynjolfsson, (iii) the redistribution of rewards towards high-
Rock and Syverson (2019) explain that technolo- skilled labour and intangible capital and away
gies that have broad potential applications and from physical capital, and (iv) a broadening of
therefore qualify as general-purpose technologies
16 The authors refer to AI technology.

the benefits derived from new technologies so growth, hinges on the assumption that it increases
that they are inclusive. employment without reducing productive invest-
ment and without hampering the incentives and
Labour market institutions not only help the
welfare of workers (Fedotenkov, Kvedaras and
workforce to adjust their skills according to
Sanchez-Martinez 2022).
the new technologies’ requirements; they also
drive technological change and thereby directly In contrast, arguments pointing to a positive rela-
enhance productivity growth. For example, tionship between labour protection and product-
improvements in occupational safety and overall ivity revolve around the alignment of incentives
health outcomes significantly contribute to eco- for employers and workers through longer-lasting
nomic development via increased productivity.17 and more predictable relationships that encourage
Children’s health affects their education and has job-specific accumulation of human capital.
long-lasting implications for their labour force Empirical analyses based on the Employment
participation and productivity later in life (Bloom, Protection Legislation (EPL) indicator compiled
Kuhn and Prettner 2019). Katsuro et al. (2010) show by the OECD have shown that decentralized but or-
that problems relating to occupational health and ganized and coordinated systems (systems where
safety as well as social health protection negatively sector-level agreements set broad framework con-
affect workers’ productive capacity in the food ditions, detailed provisions are made in firm-level
industry, resulting in reduced output per worker. negotiations, and coordination is rather strong)
Pollution and climate change also have a negative tend to deliver higher productivity (OECD 2019b).18
relationship with productivity, mainly through the In a similar vein, Bassanini and Ernst (2002) argue
worsening of workers’ health, for example through that employment protection and coordinated
heat stress (Zivin and Neidell 2012; ILO 2019b). industrial-relations regimes, by aligning workers’
and firms’ objectives, encourage firm-sponsored
Employment protection offered by labour
training as well as the accumulation of firm-specific
market institutions has also been linked to
competencies, which is conducive to increasing the
productivity performance. Legal prerogatives to
productivity of workers. Overall, a certain level of
make lay-offs costly, such as severance payments
job protection enhances firm productivity, limits
or advance notice periods, affect the level of labour
excessive turnover and incentivizes both firms
market turnover and incentivize both firms and
and employees to undertake relevant investment
employees to invest in their specific employment
to enhance workplace productivity (El-Ganainy
relationships. Some scholars believe that above a
et al. 2021).
certain level of job protection the reallocation of
labour between firms and job turnover may be Minimum wages have been shown to
impeded – leading to mismatch – and cost-saving contribute to higher labour productivity
innovation may be replaced by investments in at both the firm and economy-wide levels.19
lower-return, less risky projects (Miranda et al. At the micro level, the efficiency wage theory
2018). It has also been suggested that too stringent suggests that workers become more engaged
firing costs may strengthen the bargaining power and exert more effort in exchange for higher
of incumbent workers to an extent that reduces wages (Akerlof 1982). Georgiadis (2013) provides
incentives for productivity-enhancing investment corresponding evidence for the United Kingdom,
by employers (Caballero and Hammour 1996). while Ku (2020) and Coviello, Deserranno and
However, the view that curtailing the extent of Persico (2022) provide evidence for the United
labour market protection might lead to better States and underline the importance of well-
economic outcomes, including productivity designed minimum wage policies.20 Moreover,
17 See, among others, Weil (2006), Bloom and Canning (2008), Kumar and Kober (2012) and Saha (2013).
18 https://www.oecd.org/els/emp/oecdindicatorsofemploymentprotection.htm. On the other hand, Fedotenkov, Kvedaras and
Sanchez-Martinez (2022) show that the effect of EPL on labour productivity growth depends on the skill composition of specific
sectors; there are also differences in the sign of the impact of EPL on productivity growth for shorter and longer horizons.
19 https://www.ilo.org/global/topics/wages/minimum-wages/monitoring/WCMS_438881/lang--en/index.htm.
20 Following, for instance, ILO’s minimum wage policy guidance: https://www.ilo.org/global/publications/books/WCMS_570376/
lang--en/index.htm.
employees may stay longer with their employer, since rising inequality on this front has been linked
which provides them with valuable experience to reduced productivity growth rates in developing
and also encourages employers and employees countries (Valero 2021). Rising income inequality
to undertake productivity-enhancing training may also reduce the effective human capital pool
(Arulampalam, Booth and Bryan 2004). At the as it undermines the educational opportunities for
aggregate level, minimum wages can result in disadvantaged individuals, making the available
more productive firms replacing less productive stock of human capital at the economy-wide level
ones – and surviving firms becoming more smaller (Cingano 2014).
efficient.21 All these effects can decisively stimulate
For productivity growth to deliver shared
labour productivity growth.
prosperity and inclusivity, key labour market
Other institutional factors that improve human policies and institutions need to be in place to
capital, such as education, are generally viewed guarantee that income gains will be equitably
as crucial drivers of productivity. Human capital shared. Essential to this aim are policies to en-
acquired from education can be broadly defined hance education and skills, general health policies
as the stock of knowledge, skills and other per- (beyond occupational safety and health), funda-
sonal characteristics embodied in people that mental principles and rights at work, minimum
enable them to be more productive (OECD 2019c). wages, and labour market institutions pertaining
Investment in human capital includes formal edu- to social dialogue and collective bargaining.23 For
cation (early childhood, the formal school system example, the removal of barriers to occupational
and adult training and education programmes) choice, including by preventing discrimination on
and informal and on-the-job learning and work the basis of ethnicity or gender, can have positive
experience. Human capital plays a key role in effects for productivity while guaranteeing respect
explaining productivity differences across coun- for fundamental principles and rights at work (El-
tries (OECD 2019c). Not only is the effect of human Ganainy et al. 2021).
capital accumulation in OECD countries significant,
Raising workers’ compensation in line with
but positive social returns are also observed in
productivity growth ensures workers’ partici-
wider country samples. The ultimate impact of
pation in productivity gains. Research points to
education on productivity growth may, however,
an increasing divergence between productivity
be importantly conditioned by both the quality of
growth and workers’ wages in many countries.24
education and its interplay with skills matching in
Key determinants of such decoupling are the
the labour market.22
type of technology and a shift towards capital as
In low-income economies, the benefits of in- a production factor, facilitated by a relative de-
vesting more in education are even greater. In cline in the prices of capital goods, by automation
these countries, individuals face significant barriers techniques and by the greater mobility of capital
to investing optimally in their education, mainly wrought by globalization, including opportunities
because of high opportunity costs. Moreover, their to offshore (Fossen, Samaan and Sorgner 2022).
educational levels tend to fall significantly short A gradual erosion of labour market institutions
of what is socially optimal, given the presence of in many advanced countries, in particular a de-
positive knowledge spillovers that are even larger cline in trade union membership, has eroded the
than in higher-income countries. Equitable access quality of collective bargaining agreements and
to education is essential for productivity growth, weakened the bargaining power of workers. These
21 See, among others, Rizov, Croucher and Lange (2016), Riley and Bondibene (2015) and Mayneris, Poncet and Zhang (2014).
22 For example, ILO (2020b) focuses on the returns to education and shows that evidence of mismatch is reflected in varying returns
to education for young people across countries. This finding is rooted in countries’ dissimilar quality standards of education as
well as in differing labour market contexts.
23 Active labour market policies, which are also instrumental to well-functioning labour markets and productivity, are discussed
in the next section.
24 See, among others, ILO (2020c).
developments have played a role in shrinking the becomes critical; it is of utmost importance, first,
labour share of income.25 It has been argued that that productivity gains are realized and, second,
the causality can flow the other way, meaning that that these are evenly shared across capital owners
productivity can increase as a result of higher real and workers so that material well-being is lifted
wages, since these could be a significant driver of for all.26
aggregate demand (ILO 2012).
Not directly controllable through labour market
Changes in the distribution of firm-level product- institutions are demographic factors that
ivity have effectively increased the degree of firm can decelerate or boost labour productivity
monopsony power in the labour market, thereby growth. In particular, the ongoing demographic
weakening the bargaining power of workers and transitions in most advanced economies as well as
lowering wages relative to productivity (El-Ganainy some emerging markets – China being the most
et al. 2021). In the United States and Canada, outstanding example – involve a process of rapid
Greenspon, Stansbury and Summers (2021) ob- population ageing which is bound to impinge upon
serve that, although there has been divergence in economic growth (see figure 3.7). Potential factors
productivity and pay levels over time, increments driving the effect of ageing on labour productivity
in the growth rates of productivity and workers’ growth comprise increasing difficulties in filling
compensation exhibit a strongly positive cor- job vacancies owing to increasing skill mismatch/
relation. These findings imply that policies and/ depreciation; lower rates of start-up creation,
or trends that lead to incremental increases in entrepreneurship and innovation at the firm
productivity growth tend to raise middle-class level; and slower technology diffusion owing to
incomes, even though other factors, such as the the slower pace at which an older working-age
quality of labour market institutions, may be population may adopt new technologies.27
driving productivity and pay apart (Productivity
Poplawski-Ribeiro (2020) provides a thorough
Institute 2021).
empirical analysis revealing that ageing has played
The goal of lifting productivity growth needs to a significant role in slowing down TFP growth in
be weighed against potential costs for workers. recent decades in a group of both advanced and
The work intensification and lack of workplace transitioning economies. Focusing on labour
autonomy triggered by mechanization and com- productivity growth, Maestas, Mullen and Powell
puterization have been identified as important (2016) find in the case of the United States that an
stressors in workforce health (Gallie 2012; Gallie increase in the fraction of the population above
and Ying 2013; Isham, Mair and Jackson 2020). 60 years of age significantly decreases labour
Moreover, although ICT can promote productivity productivity and hourly worker compensation. In
growth, it can also blur the boundaries between a comparable analysis using data for Europe, Aiyar,
work and home life, hence reducing well-being. Ebeke and Shao (2016) show that the ageing of the
Here the notion of inclusive productivity growth workforce reduces growth in labour productivity,
25 For more details, see https://www.ilo.org/wcmsp5/groups/public/---dgreports/---stat/documents/publication/wcms_712232.pdf.

26 The OECD (2018) stresses the risk posed by the vicious cycle whereby individuals with fewer skills and poorer access to opportun-
ities are forever confined to unproductive and often precarious jobs. This in turn reduces aggregate productivity and widens
inequality. The OECD’s report underscores the importance of inclusive growth as a means of ensuring aggregate productivity
growth and examines different policy options to accomplish this.
27 Examples of studies investigating the role of ageing on entrepreneurship include Karahan, Pugsley and Şahin (2019), Liang,
Wang and Lazear (2018), Bornstein (2020) and Engbom (2019). Studies that confirm its ultimate negative impact on productivity
growth comprise Decker et al. (2014) and Alon et al. (2018). In a study for OECD regions on the role of the erosion of skills,
Daniele, Tahu and Lembcke (2020) find that the negative association between ageing and productivity growth is strongest in
knowledge-intensive services. On knowledge diffusion, Davis, Hashimoto and Tabata (2022) provide a theoretical model in which
a contraction in the population of working age leads to lower knowledge spillover within and across firms, and hence lower
productivity growth. Viviani et al. (2021) carried out a systematic survey of micro studies in both developing and developed
countries and conclude that there was no difference in productivity between older and younger workers, since older workers
performed better than younger workers but had more absenteeism. Another indirect channel through which ageing has a
bearing on productivity is through shifts in the consumption basket across the consumer’s life cycle. The demand for services
increases with age, thereby accelerating structural transformation towards service-based economies. Since the service sector
exhibits lower labour productivity growth rates, in aggregate, this weakens economy-wide productivity growth (Vollrath 2020).
The role of sectoral structural change is elaborated on in Appendix F.
X Figure 3.7. Working-age population trajectories in some of the world’s

most populous countries, 1980–2030 (percentages of total population)
100
95
90
85
80
75
70
65
1980 1985 1990 1995 2000 2005 2010 2015 2020 2025 2030
Nigeria India Indonesia Brazil China Russian Federation United States Germany
Note:Working-age population is defined here as the number of people in the 15–64 age bracket.
Source:Authors’ calculations based on World Population Prospects 2022 of UN Population Division.
mainly through its negative effect on TFP growth Figure 3.7 shows that trends in working-age
rather than on investment in physical capital.28 population similar to those of the United States
The net impact of ageing on labour productivity and Germany occur in other economies too. Brazil
growth through its impact on investment is am- and China are projected to undergo a sizeable hol-
biguous, given that this phenomenon might entail, lowing out of their working-age population, while
on one hand, capital deepening spurred by scarcer India’s and Indonesia’s working-age populations
labour (Acemoglu and Restrepo 2017) and, on the are also trending downwards, albeit at a slower
other, a savings glut and fewer opportunities for pace. On the other hand, demographic trends in
investment (Jimeno 2019). Nigeria – as in much of Africa – are projected to
continue to support economic growth.29
28 The largest negative impact is expected to occur in countries such as Spain, Italy, Portugal, Greece and Ireland, where rapid
workforce ageing is expected and which also face high debt burdens.
29 Africa is expected to undergo a vast demographic expansion that will result in a sizeable rise in urbanization rates. Although the
positive contribution of urbanization to productivity growth, based on density and network effects, is well documented for other
regions of the world, the anticipated effects for Africa are unclear. This is not least because there is evidence that a large majority
of the African urban population experience informal work and inadequate housing. Thus, the development of well-functioning
cities is key to enabling these demographic trends to be conducive to productivity growth and well-being (Page et al. 2020).
X What else explains the productivity slowdown?
Several other factors have been discussed that countries are: (i) high degrees of informality in
shape the environment in which firms operate, labour markets; and (ii) poorly performing financial
thereby influencing the potential for labour markets and institutions, which condition the
productivity growth; they include market struc- innovation investment decisions made by firms
tures, physical infrastructure, the institutional (Andrade, Cosentino and Sagazio 2022). The extent
framework and the quality of governance (Dieppe of ICT use, technology adoption, skills availability,
2021; ILO 2021b). and access to external knowledge inhibits
productivity growth in countries of all income
The lack of diffusion of new technologies is a
groups. These are all robust enablers of different
major factor behind the productivity paradox
types of innovation and critically influence the
(Ernst 2022a). First, in recent years “superstar”
productivity of local firms (Dosso 2022).
firms have emerged, which manage to absorb
the lion’s share of the surplus generated by Market concentration creates entry barriers
productivity growth (Autor et al. 2020). This can and is preventing the wider diffusion of benefits
explain low productivity growth and its uneven from new technologies. The benefits of new tech-
distribution as well as widening income inequality. nologies seem to be enjoyed by a relatively small
Second, low exit rates of unproductive firms drag fraction of the economy, and the technologies’
down average productivity growth at the industry narrowly scoped and rivalrous nature creates
level, since these firms hold on to resources that wasteful “gold rush” activity (Brynjolfsson, Rock
could be more productively used elsewhere. This and Syverson 2019). A small number of players
second factor has probably been exacerbated by dominate several markets of the digital economy,
the COVID-19 crisis, since the support measures and the nature of the business and extant network
implemented in many countries kept firms afloat effects may give rise to (natural) monopolies.31
that would otherwise have exited the market.30 Industry concentration can lead to welfare losses
Third, the necessary complementary investments owing to the distortions caused by market power
in new skills and intangible assets are lacking. (see, for example, De Loecker and Eeckhout 2017;
Gutierrez and Philippon 2017).
In regard to the role of digital technologies in the
developing world, there is evidence that, despite Other research points towards sizeable product-
noticeable improvements in innovation investment ivity differences between frontier firms and
and networks and in the capacity to adopt and average firms in the same industries in advanced
diffuse new technological knowledge, such economies (Andrews, Criscuolo and Gal 2016;
progress remains geographically very concentrated, Furman and Orszag 2015). Similarly, gaps in profit
and sustained productivity gains have not yet margins between top and bottom performers in
materialized in the dominant agricultural sector most industries in the United States have grown
or for the myriad of micro, small and medium-sized (McAfee and Brynjolfsson 2008). This indicates
enterprises. In sub-Saharan African countries, that productivity gains can be made by some firms
labour productivity has lost ground with respect without the same gains manifesting in the broader
to both the technology frontier, represented by the population of firms. A smaller number of superstar
United States, and the Asian Dragons and other firms are gaining market share (Autor et al. 2020;
dynamic emerging markets, such as Brazil, China Tambe et al., 2020) with consequences also for
and India (Dosso 2022). Two of the main barriers workers, whose earnings in the United States are
impeding the translation of technological advances increasingly tied to firm-level productivity differ-
into labour productivity gains in developing ences (Song et al. 2018).
30 The latest evidence for OECD countries on firms’ churn rates suggests that such exacerbation has occurred: https://stats.oecd.
org/Index.aspx?DataSetCode=SSIS_BSC_ISIC4.
31 In the media, reference is often made to “FAANG”, the five prominent tech companies: Facebook, Amazon, Apple, Netflix and
Google.
The primary difficulty in measuring AI capital is, The European Commission (2022) has estimated
as mentioned above, its often intangible nature. the impact on labour productivity growth of in-
Intangible assets are an important driver of vestments in intangible and tangible assets in the
labour productivity growth. 32 This is especially years preceding the Great Recession to ascertain
true in countries at later stages of economic whether these investments rendered industries
development, since the productivity gains more resilient. The authors find that, in the long
accruing from the accumulation of traditional run, investment intensity in both intangible
inputs – such as investment in physical capital – and tangible assets was associated with higher
are progressively lower, owing to the well-known productivity growth. Among intangible assets,
phenomenon of decreasing returns to scale. Roth R&D bears a statistically significant relationship
(2019) concludes from an in-depth survey of the with both labour productivity and TFP growth.
literature that the economic debate surrounding
The potential of digital technologies to raise
the role of intangibles broadly acknowledges their
productivity could be overestimated and low
importance in the transformation of developed
productivity growth could be the new normal.
economies into fully f ledged knowledge
A principal argument why digital technologies are
economies. The results of his research also
expected to boost productivity growth is their po-
show that, in order to fully reap the benefits of
tential to automate routine tasks that are currently
investment in ICT and AI, businesses need to
performed by labour (see box 3.3). The extent to
make complementary investments in intangible
which this restructuring is actually taking place
assets. Furthermore, the literature highlights the
is unclear. Some evidence exists for the United
importance of a well-endowed infrastructure of
States (see Autor, Levy and Murnane 2003) but
public intangibles.33
this evidence is not conclusive. Furthermore, there
Intangible investment is an important driver exist substantial cross-country differences in the
of labour productivity growth, but its impact routineness of job tasks, both at the national level
depends on the type of intangible assets and the and within specific occupations (see Lewandowski,
specific sector in which the investment occurs Park and Schotte 2020; Lewandowski et al. 2022).
(European Commission 2020). Some of the The differences in tasks between countries
assets accounted for in national accounts, such at different stages of development are much
as research and development (R&D) and software, greater than can be explained by differences in
remain key for labour productivity growth in the occupational structure. Not surprisingly, work in
manufacturing sector, whereas non-national- advanced countries involves the largest share of
account intangibles, which include economic non-routine cognitive analytical and non-routine
competencies, are more important for services. cognitive interpersonal tasks, and often has the
Given the highly predominant share of services least manual tasks, while the opposite is true for
in advanced economies, this result highlights the EMDEs. Routine cognitive tasks are lowest in the
importance of investing in non-national-account least and most developed countries and highest
intangibles and of duly accounting for them. In a in Eastern and Southern European countries, sug-
similar vein, Niebel, O’Mahony and Saam (2017) use gesting an inverse U-shaped relationship between
sectoral data to conclude that the contribution of the role of routine cognitive work and the level
intangibles to labour productivity growth is gener- of development.
ally highest in manufacturing and finance, where
In comparison with previous waves of industri-
the estimated output elasticity of intangibles lies
alization, the benefits of further digitalization for
between 0.1 and 0.2.
productivity growth seem limited. Gordon (2013
Investment in intangible assets can make re- and 2017) and Gordon and Sayed (2020), among
coveries from crises faster in terms of the pace others, state that the main reason for the current
of resumption of labour productivity growth. slowdown is that the benefits of major innovations
32 For a comprehensive overview of recent economic literature on intangible assets and their importance, including specific defin-
itions and ways to properly account for them, see Haskel and Westlake (2018).
33 Public intangibles cover a broad spectrum of assets, such as public sector information, trademarks, know-how and the value
of access to public spaces for private events.
introduced during the 20th century – such as elec- disruptive technological advances of the past have
tricity and the combustion engine – are wearing already been harvested, and only innovations with
thin. In their view, the low-hanging fruit from the lower marginal returns remain to be made.
X Policy options
Sustained productivity increases that deliver

shared prosperity should be a central focus for
Creating an environment
policymakers and social partners. The analysis for sustainable productivity
in this chapter has demonstrated that the slow-
down in productivity growth, which started as a
growth
phenomenon of advanced economies decades The provision of an environment for sustainable
ago, has become a global concern. The reasons businesses is crucial. Productivity improvements
for the slowdown are still being debated, and ultimately need to be implemented in enterprises,
country-specific factors may well play a role. In through changes in the working environment
these circumstances, it is impossible to identify and production processes. This means that
a single, one-size-fits-all policy approach. Yet the policymakers may seek to positively change the
observation that the slowdown is now widespread business environment so that firms have the
across the globe, and that for many countries it has incentives to make changes that are conducive to
become persistent, points towards the possibility increasing productivity. At the highest policy level,
that structural problems are inhibiting stronger governments need to provide a macroeconomic,
productivity growth. legal and institutional framework in which private
enterprises can thrive. Such an environment starts
Higher productivity growth was possible in the
with enforceable property rights, anti-corruption
past. Policymakers can therefore focus on areas
laws and competition laws that together allow
that are known to have raised productivity growth:
fair access of economic agents to markets and
a conducive business environment, and public and
prevent the creation of monopolies, monopsonies
private investment in production capabilities that
and oligarchies.
enable the development and diffusion of technolo-
gies that improve or facilitate sustainable produc- The legal and institutional framework should be
tion or consumption of goods and services and, maintained by independent and effective courts
ultimately, serve to improve people’s lives. Finally, that uphold the rule of law. A stable macroeco-
policies that support investment in people – in all nomic environment requires low inflation and
forms of human capital – offer the prospect of macroeconomic policies to absorb shocks. If such
raising productivity growth to precedented higher a basic framework cannot be maintained, as may
levels. Such policies would attempt to strategically be the case in developing countries in particular, it
increase workforce quality through (re-)education is difficult to create stable markets and to promote
and (re)training along a career-long horizon and sustainable enterprises that have the necessary
would also promote better access to the resources incentives to enter and operate in these markets
that enable people to build up and maintain their to create productive employment opportunities.
own human capital. Proper macro-prudential regulation, in this re-
spect, is essential for productivity growth and the
Other policy options that are discussed in this
creation of decent work (Ernst 2019).
section relate to the policy mechanisms and
institutional arrangements through which the Tax policies are an essential element of
above-mentioned policy areas can be effectively achieving inclusive productivity growth. In
and efficiently addressed. the current era of digitalization and robotization,
taxation has become heavily skewed towards
burdening labour. Government taxation should
instead find the right balance between reducing
inequality and preserving long-term product- widely shared across the population. Although
ivity and growth. Recent evidence indicates that the exact reasons for this are still unclear, policy
this policy trade-off may not be fully respected areas that need attention in this regard concern
(Merola 2022). For example, Acemoglu, Manera the promotion of fair competition between firms
and Restrepo (2020) argue that the United States and the avoidance of monopolies in technology,
currently taxes machinery and equipment too little data and digital infrastructure. Regulation should
compared with labour, to the point of encouraging support the diffusion, across firms and people,
excessive automation that eliminates jobs without of digital technology and its benefits over the
making the economy more productive. medium term. It should also be directed at
preventing social or economic abuse of the
Private investment in means of production,
information asymmetries that can be created
including technology, is needed, as well as suf-
through digital technologies, and should support
ficient investment in public infrastructure like
a human-centred use of technology that improves
transportation and digital infrastructure. For ex-
the well-being of people.
ample, smartphone network coverage and internet
access are important for the creation and main- Stronger efforts are needed to support human
tenance of a facilitating business environment. If capital development in the workforce and
only a fraction of the population and of enterprises strong labour market institutions. Governments
have access to hardware, digital devices and the should work closely with social partners, employers
internet, the economy experiences a digital divide. and workers to make sure that education systems
Certain groups, likely to be based on demographic and skills training correspond to enterprises’ needs
characteristics such as gender or income, will and hence lead to higher productivity growth.
have limited or no access to the digital economy. Workforce quality is crucial to the use of new
Such a divide can also occur between different technologies and to harvesting the productivity
geographical regions of an economy, especially gains that new production processes may offer.
between rural and urban areas, and may require Besides investments in education and training
targeted policy measures. More generally, care systems to create and maintain an employable and
needs to be taken that financial innovation does effective workforce, active labour market policies
not elicit new sources of economic instability can improve the efficiency of the labour market
and volatility. and have been shown to lead to productivity in-
creases, for example through improved skills and
Financial stability and access to financial re- knowledge spillover (Goulas and Zervoyianni 2018;
sources are essential. Small and medium-sized Escudero 2018; Escudero et al. 2019). The charac-
enterprises need access to credit or equity and they teristics of digital transformation imply that labour
often have limited or no access to global financial market policies should also embrace flexibility in
markets. Recent advances in digital technologies labour market transitions, which allows talent
have obtained new financial solutions and led to to flow between different firms, while ensuring
the creation of high-tech financial services com- that workers have adequate social protection
panies, so called “fintech”. These financial digital (Petropoulos 2022).
applications may have the potential to improve fi-
From a broader, social justice perspective, efforts to
nancing options in developing countries (including
maintain a healthy population have been shown to
in rural areas), in which financial institutions tend
be a source of cross-country differences in income
to be less developed.
per worker. This finding calls for the implementa-
The development, diffusion, implementation tion of public health measures as a complementary
and adoption of new technologies across means of delivering higher productivity growth
firms and countries should be promoted. 34 (Bloom et al. 2022). Moreover, the elimination of
This chapter has shown that many advances in violence, harassment and discrimination at work,
digital technologies have so far failed to translate may also be productivity-enhancing because of
into measurable productivity increases that are the negative impact that such nefarious behaviour
34 This statement applies to all kinds of technologies but this chapter discusses this issue mainly in relation to digital technologies.
has on workers’ mental health (see, for instance, Social dialogue is crucial for buttressing efforts
ILO 2022e). to improve productivity. 36 This pillar is central
to addressing the large productivity differences
Adequate unemployment insurance systems are
among individuals and firms as well as the widening
essential to provide jobseekers with the necessary
gap between productivity growth and wage growth,
income support and to give them the incentive to
which disproportionately hurt workers. There
find jobs that match their skills and aspirations.
is also evidence that bolstering the quality of
Unemployment benefits should not prevent job-
industrial relations at the shop floor level helps
seekers from devoting time to finding jobs that
to prevent inefficient restructuring, thereby
match their skills. Recent research suggests
improving firm productivity. Works councils, which
that the extension of unemployment insurance
have to be consulted on restructuring, investment
benefits may significantly improve job matching,
plans or layoffs, have been shown to reduce labour
thereby raising productivity (Acemoglu and Shimer
turnover. When combined with industry-level
1999 and 2000; Farooq, Kugler and Muratori 2020).
bargaining that prevents rent-seeking, works
councils have been shown to raise firm-level
productivity and speed up the introduction of new
Productivity ecosystems technologies (El-Ganainy et al. 2021). The overall
for decent work and just effects of trade unions and collective bargaining
on productivity are ambiguous and subject to
transition debate (ILO 2022f; Doucouliagos, Freeman and
Laroche 2017). Nevertheless, a stronger voice of
With regard to policy mechanisms through which
organized labour at the company level could help
policies could become effective, the ILO is pro-
to achieve faster and more equitable introduction
posing a “productivity ecosystems for decent
of new technologies, which in turn could improve
work” framework to address existing barriers
the longer-term prospects for productivity and
to productivity growth. 35 Enterprises and their
employment, for instance by strengthening
workers are embedded in an “ecosystem” in which
incentives for worker training and supporting
the drivers of productivity growth and decent work
workforce reorganization.
are interlinked across several levels. Policies need
to target specific industry and occupational needs Special attention should also be given to the role
to help businesses and employees to acquire the played by policies aiming to reduce the incidence
necessary competences to enable a successful of informal employment. The low productivity of
technological transformation. Businesses not only the informal economy is a major drag on aggregate
lack necessary skills among their employees; they productivity growth and leads to the persistence
also often lack the requisite managerial experience, of poverty. Key policies to ameliorate the informal
which can be acquired, for instance, through more economy comprise the creation of formal business
intensive interaction with competitors in similar or incentives, access to finance through national de-
related sectors (Bender et al. 2018; Bloom et al. velopment banking or government-backed loans,
2019). Low managerial turnover thus hampers the development of business owners’ and workers’
the adoption of more productive management skills (to improve resource allocation and manage-
practices (Bloom et al. 2020). Moreover, faster ment practices while raising labour productivity),
productivity growth requires that micro and small simple and fair taxation, anti-corruption policies,
enterprises be helped to transition to formality a stable and conducive business climate and the
and to achieve and maintain a minimum efficient simplification of registration procedures, among
scale and economic viability. other things (El-Ganainy et al. 2021).
35 https://www.ilo.org/empent/Projects/productivity-ecosystems/lang--en/index.htm.
36 A recent story from Colombia illustrates very well how social dialogue and collective bargaining have greatly improved product-
ivity: https://www.ilo.org/global/about-the-ilo/multimedia/features/colombia/collective-bargaining/lang--en/index.htm.
Institutional arrangements standards to platform workers, since without this

the rewards of the digital transformation may
to promote productivity remain concentrated among a small number of
and decent work players (ILO 2018).
Skills development and vocational training
Central coordinating bodies can play an im-
play a prominent role in the productive up-
portant role in providing guidance to the pri-
grading of economies, as does the recognition
vate sector to promote productivity (Mazzucato
of professional experience gained on the job.
2013 and 2022). Public institutions can provide
However, the proper development of educational
important services to reduce transaction costs for
curricula remains a challenge for many countries.
businesses. For instance, they provide information,
An integrated process of curriculum develop-
help coordinate different actors to set standards
ment, involving social partners and business and
and promote their application through procure-
educational institutions, is key to effective and
ment policies, ensure the delivery of relevant skills
relevant skills development (Nübler 2014). For
and training and reduce the risks of investment
instance, occupational curricula for Germany’s
in moon-shot ventures deemed to have societal
dual vocational training systems are subject to
importance. Such coordinating institutions are
regular revisions and integration of new course
particularly important in developing countries
content in line with employers’ requirements. In
undergoing large structural adjustment processes
the Republic of Korea, close collaboration between
(Salazar-Xirinachs, Nübler and Kozul-Wright 2014).
public and private institutions has ensured that
At minimum, productivity organizations pro- employees receive adequate training and a broad-
vide essential information for businesses and based general education, helping the country to
workers to make informed decisions about navigate a rapid structural adjustment process
investments and education. The ILO emphasizes (Cheon 2014). Getting the private sector to take
the role of such national productivity organizations ownership of the provision of skills and training is
and their mandate to promote productivity important to ensuring that relevant and up-to-date
growth. Such organizations are supposed to be content is provided.
independent institutions (neither government nor
employers nor workers dominate the institution) Institutional developments with regard to skills
and can steer national and regional policies to- anticipation and professional orientation can help
wards measures that facilitate productivity growth. workers and businesses to adjust to shifts in eco-
Typically, these organizations carry out economic nomic opportunities. The Skills Future Singapore
and statistical analysis and publish their results to initiative, for instance, allows employees to more
influence policies in their countries and encourage rapidly find new occupational opportunities in
reforms that seek sustainable economic growth. line with their previous professional experience
National productivity organizations may consult and formal training. New approaches that accord
relevant stakeholders but are required to be ob- greater value to the professional experience that
jective and neutral. people build up over their lifetime are needed
to support productive occupational transitions
Productivity organizations can also help to
(McKinsey 2022). Public certification standards to-
promote standards and streamline public
gether with new digital forms of (micro-)certificates
procurement policies. Industry standards are
could constitute a useful strategy to strengthen
an important tool for coordinating businesses and
lifelong learning.
their investment and reducing transaction costs
in their activities. Where soft laws and industry Public spending on general R&D has declined in
agreements are not sufficient, public actors can many countries over the past decade despite its
step in or help to negotiate agreements. Industry important role in the development of frontier
standards have been particularly important in the technologies. The use of sovereign wealth funds
evolution of the digital economy, where inter- (SWFs), which have proliferated in recent years
national standards and regulations are important to manage national resources, should receive
to ensure frictionless trade in digital services. more attention (Thatcher and Vlandas 2022). So
Further convergence is needed, however, especially far, most SWFs have taken a passive stance in the
in upholding the application of international labour management of their investments both domestically
and abroad. However, given the size these funds upgrading and the protection of environmental
have reached, there have been attempts to use at resources (Ernst 2022b; Ernst, Schörling and
least part of the funds in more active investment Achtnich 2022). In the absence of these mech-
strategies, especially in supporting innovative anisms, many countries prefer to dispose of their
projects. Saudi Arabia, for instance, launched natural resources through mineral and timber
its Future Investment Initiative Institute in 2017, extraction, which does not create conditions for
partly funded by its Public Investment Fund, with successful structural transformation. The conclu-
the specific purpose of investing in sustainability- sions on a new “Loss and Damage” fund reached
related moon-shot projects. Similarly, SWFs at the recent United Nations Climate Change
from Singapore, Malaysia and Abu Dhabi have Conference (COP27) provide an important step
investments in Silicon Valley to support innovative in the development of international governance
digital companies with a view to helping to diversify mechanisms. This fund should be extended to
the home economies (WIPO 2020). Overall, a more valuing natural capital through, for instance,
active stance of such funds would mobilize sufficient payment for ecosystem services, an avenue
resources to help transform economies to fulfil that promises to generate additional financial
their sustainability goals while improving their resources instead of redistributing existing ones
productive base (Ernst 2022a). as the “Loss and Damage” fund is intended to
Finally, the ongoing transition to a green do (Dasgupta 2021). In combination with SWFs
economy offers the potential for significant or national development boards, as discussed
productive upgrading, especially in developing above, such governance innovations can be used
countries. Many of these countries contain large to provide additional resources for private sector
areas of natural habitats that are essential to development, as has been suggested by the
ecological regeneration and the regulation of the Rwanda Development Board. In combination with
global climate. Shifts in international governance the just transition policies discussed above, the
mechanisms to value these forms of natural capital pursuit of such nature-based solutions promises
would allow these countries to obtain additional to produce significant benefits for sustainable
financial resources to help fund both technological economic development (ILO and UNEP 2022).
References
X Acemoglu, D., and D.H. Autor. 2011. “Skills, Tasks and Technologies: Implications for
Employment and Earnings”. In Handbook of Labor Economics, edited by Orley Ashenfelter and
David Card, Vol. 4B, 1043–1171. Amsterdam: Elsevier.
X Acemoglu, D., A. Manera, and P. Restrepo. 2020. “Does the US Tax Code Favour Automation?”
NBER Working Paper 27052.
X Acemoglu, D., and P. Restrepo. 2017. “Secular Stagnation? The Effect of Aging on Economic
Growth in the Age of Automation”. American Economic Review: Papers & Proceedings 107 (5):
174–179.
X Acemoglu, D., and R. Shimer. 1999. “Efficient Unemployment Insurance”. Journal of Political
Economy 107 (5): 893–928.
X ———. 2000. “Productivity Gains from Unemployment Insurance”. European Economic Review 44
(7): 1195–1224.
X Adalet McGowan, M., and D. Andrews. 2015. “Labour Market Mismatch and Labour
Productivity: Evidence from PIAAC Data”, OECD Economics Department Working Paper
No. 1209. https://doi.org/10.1787/5js1pzx1r2kb-en.
X Aiyar, S., C. Ebeke, and X. Shao. 2016. “The Impact of Workforce Aging on European
Productivity”, IMF Working Paper WP/16/238. https://www.imf.org/external/pubs/ft/wp/2016/
wp16238.pdf.
X Akerlof, G. 1982. “Labor Contracts as Partial Gift Exchange”. Quarterly Journal of Economics 97:
543–569.
X Alon, T., D. Berger, R. Dent, and B. Pugsley. 2018. “Older and Slower: The Startup Deficit’s Lasting
Effects on Aggregate Productivity Growth”. Journal of Monetary Economics 93: 68–85.
X Andrade, R.B., L. Cosentino, and G. Sagazio. 2022. “Improving Productivity through Innovation
Policy in Brazil”. In Global Innovation Index 2022, 15th Edition: What Is the Future of Innovation Driven
Growth? WIPO.
X Andrews, D., C. Criscuolo, and P. Gal. 2016. “The Best versus the Rest: The Global Productivity
Slowdown, Divergence across Firms and the Role of Public Policy”, OECD Productivity Working
Papers No. 5. https://doi.org/10.1787/63629cc9-en.
X Arntz, Melanie, Terry Gregory, and Ulrich Zierahn. 2016. “The Risk of Automation for Jobs
in OECD Countries”, OECD Social, Employment and Migration Working Papers 189. https://
www.oecd-ilibrary.org/social-issues-migration-health/the-risk-of-automation-for-jobs-in-oecd-
countries_5jlz9h56dvq7-en.
X Arulampalam, W., A. Booth, and M. Bryan. 2004. “Training and the Minimum Wage”. Economic
Journal 114: C86–C94.
X Autor, D.H. 2013. “The ‘Task Approach’ to Labor Markets: An Overview”. Journal for Labour Market
Research 46: 185–199.
X Autor, D.H., D. Dorn, D., L.F. Katz, C. Patterson, and J. Van Reenen. 2020. “The Fall of the Labor
Share and the Rise of Superstar Firms”. Quarterly Journal of Economics 135 (2): 645–709, https://doi.
org/10.1093/qje/qjaa004.
X Autor, D.H., F. Levy, and R.J. Murnane. 2003. “The Skill Content of Recent Technological Change:
An Empirical Exploration”. Quarterly Journal of Economics 118 (4): 1279–1333.
X Autor, D.H., and A. Salomons. 2017. “Does Productivity Growth Threaten Employment?” Paper
prepared for the ECB Forum on Central Banking, 19 June 2017. https://www.ecb.europa.eu/pub/
conferences/shared/pdf/20170626_ecb_forum/D_Autor_A_Salomons_Does_productivity_growth_
threaten_employment.pdf.
X Badulescu, D., A. Badulescu, R. Simut, D. Bac, Elena-Ana Iancu, and N. Iancu. 2020. “Exploring
Environmental Kuznets Curve: An Investigation on EU Economies”. Technological and Economic
Development of Economy 26 (1): 1–20.
X Banerjee, R.N., and B. Hofmann. 2020. “Corporate Zombies: Anatomy and Life Cycle”,
BIS Working Paper No. 882. https://www.bis.org/publ/work882.htm.
X Bank of Finland. 2021. “The Depths of the COVID-19 Crisis, and the Recovery”, Bank of Finland
Bulletin 6/2020.
X Barro, R.J. 1999. “Notes on Growth Accounting”. Journal of Economic Growth 4 (2): 119–137.
X Bassanini, A., and E. Ernst. 2002. “Labour Market Regulation, Industrial Relations and
Technological Regimes: A Tale of Comparative Advantage”. Industrial and Corporate Change 11 (3):
391–426.
X Baumol, William J. 1967. “Macroeconomics of Unbalanced Growth: The Anatomy of Urban Crisis”.
American Economic Review 57 (3): 415–426.
X Baumol, William J., and William G. Bowen. 1966. Performing Arts, the Economic Dilemma: A Study
of Problems Common to Theater, Opera, Music and Dance. Cambridge, MA: MIT Press.
X Bender, S., N. Bloom, D. Card, J. Van Reenen, and S. Wolter. 2018. “Management Practices,
Workforce Selection, and Productivity”. Journal of Labor Economics 36 (S1): S371–S409.
X Benigno, P., L.A. Ricci, and P. Surico. 2015. “Unemployment and Productivity in the Long Run:
The Role of Macroeconomic Volatility”. Review of Economics and Statistics 97 (3): 698–709.
X Betcherman, Gordon. 2015. “Promoting Productive Employment and Decent Jobs: What Should
Be Done about Informal Employment?” Paper prepared for the Expert Group Meeting on Social
Development and Agenda 2030, New York, NY, 21–23 October 2015. https://www.un.org/esa/
socdev/egms/docs/2015/sd-agenda2030/BetchermanPaper.pdf.
X Bloom, D., and D. Canning. 2008. “Population Health and Economic Growth”, Commission on
Growth and Development Working Paper No. 24.
X Bloom, D., R. Kotschy, K. Prettner, D. Canning, and J. Schünemann. 2022. “Health and Economic
Growth: Reconciling the Micro and Macro Evidence”, CESifo Working Paper No. 9806.
https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4148203.
X Bloom, D., M. Kuhn, and K. Prettner. 2019. “Health and Economic Growth”. Oxford Research
Encyclopedias: Economics and Finance, 25 February 2019.
X Bloom, N., E. Brynjolfsson, L. Foster, R. Jarmin, M. Patnaik, I. Saporta-Eksten, and J. Van Reenen.
2019. “What Drives Differences in Management Practices?” American Economic Review 109 (5):
1648–1683. https://doi.org/10.1257/aer.20170491.
X Bloom, N., A. Mahajan, D. McKenzie, and J. Roberts. 2020. “Do Management Interventions Last?
Evidence from India”. American Economic Journal: Applied Economics 12 (2): 198–219.
X Bornstein, G. 2020. “Entry and Profits in an Aging Economy: The Role of Consumer Inertia”.
Mimeo.
X Brynjolfsson, Erik, and Andrew McAfee. 2014. The Second Machine Age: Work, Progress, and
Prosperity in a Time of Brilliant Technologies. New York, NY: W.W. Norton.
X Brynjolfsson, Erik, and Tom Mitchell. 2017. “What Can Machine Learning Do? Workforce
Implications”. Science 358 (6370): 1530–1534.
X Brynjolfsson, Erik, D. Rock, and C. Syverson. 2019. “Artificial Intelligence and the Modern
Productivity Paradox: A Clash of Expectations and Statistics.” In The Economics of Artificial
Intelligence: An Agenda, edited by Ajay Agrawal, Joshua Gans and Avi Goldfarb. Chicago, IL:
University of Chicago Press.
X Byrne, D., J. Fernald, and M.B. Reinsdorff. 2016. “Does the United States Have a Productivity
Slowdown or a Measurement Problem?” Brookings Papers on Economic Activity, 10–11 March 2016,
109–157.
X Caballero, R.J., and M.L. Hammour. 1996. “On the Timing and Efficiency of Creative Destruction”.
Quarterly Journal of Economics 111 (3): 805–852.
X Chen, X., W. Ma, and V. Valdmanis. 2021. “Can Labor Productivity Growth Reduce Carbon
Emission? Evidence from OECD Countries and China”. Management of Environmental Quality 33 (3):
644–656.
X Cheon, B.Y. 2014. “Skills Development Strategies 7 and the High Road to Development in the
Republic of Korea”. In Transforming Economies: Making Industrial Policy Work for Growth, Jobs and
Development, edited by José Manuel Salazar-Xirinachs, Irmgard Nübler and Richard Kozul-Wright.
ILO.
X Chutchian, Maria. 2022. “Bankruptcy Filings Are Creeping Back Up in 2022”. Reuters, 5 April
2022. https://www.reuters.com/legal/transactional/bankruptcy-filings-are-creeping-back-up-
early-2022-2022-04-05/.
X Cingano, F. 2014. “Trends in Income Inequality and Its Impact on Economic Growth”, OECD
Social, Employment and Migration Working Paper No. 163. http://dx.doi.org/10.1787/5jxrjncwxv6j-
en.
X Coviello, D., E. Deserranno, and N. Persico. 2022. “Minimum Wage and Individual Worker
Productivity: Evidence from a Large US Retailer”. Journal of Political Economy 130 (9): 2315–2360.
X Daniele, F., H. Taku, and A.C. Lembcke. 2020. “Ageing and Productivity Growth in OECD Regions:
Combatting the Economic Impact of Ageing through Productivity Growth?” In Ageing and Fiscal
Challenges across Levels of Government. OECD. https://www.oecd-ilibrary.org/sites/dc2ae16d-en/
index.html?itemId=/content/component/dc2ae16d-en.
X Davis, C., Ken-Ichi Hashimoto, and K. Tabata. 2022. “Demographic Structure, Knowledge
Diffusion, and Endogenous Productivity Growth”. Journal of Macroeconomics 71: 103396.
X Dasgupta, P. 2021. The Economics of Biodiversity: The Dasgupta Review. London: HM Treasury.
X Decker, R., J. Haltiwanger, R. Jarmin, and J. Miranda. 2014. “The Role of Entrepreneurship in
US Job Creation and Economic Dynamism”. Journal of Economic Perspectives 28 (3): 3–24.
X De Loecker, J., and J. Eeckhout. 2017. “The Rise of Market Power and the Macroeconomic
Implications”, NBER Working Paper No. 23687. https://www.nber.org/papers/w23687.
X De Vries, K., A. Erumban, and B. Van Ark. 2021. “Productivity and the Pandemic: Short‑Term
Disruptions and Long‑Term Implications. The Impact of the COVID-19 Pandemic on Productivity
Dynamics by Industry”. International Economics and Economic Policy 18: 541–570.
X Dieppe, A., ed. 2021. Global Productivity: Trends, Drivers, and Policies. World Bank. https://www.
worldbank.org/en/research/publication/global-productivity.
X Dosso, M. 2022. “Building Place-Based Innovation Capabilities for Productivity in Sub-Saharan
Africa”. In Global Innovation Index 2022, 15th Edition: What Is the Future of Innovation Driven Growth?
WIPO.
X Doucouliagos, H., R.B. Freeman, and P. Laroche. 2017. “Unions and Productivity Growth”.
In The Economics of Trade Unions, edited by Hristos Doucouliagos, Richard B. Freeman and Patrice
Laroche. London: Routledge.
X Duernecker, G., and M. Sanchez-Martinez. 2022. “Structural Change and Productivity Growth in
Europe – Past, Present and Future”. European Economic Review 104329.
X El-Ganainy, Asmaa, Ekkehard Ernst, Rossana Merola, Richard Rogerson, and Martin Schindler.
2021. “Labor Markets”. In How to Achieve Inclusive Growth, edited by Valerie Cerra, Barry
Eichengreen, Asmaa El-Ganainy and Martin Schindler. Oxford: Oxford University Press. https://doi.
org/10.1093/oso/9780192846938.003.0003.
X Engbom, N. 2019. “Firm and Worker Dynamics in an Aging Labor Market”, Federal Reserve Bank
of Minneapolis Working Paper 756.
X Ernst, E. 2019. “Finance and Jobs: How Financial Markets and Prudential Regulation Shape
Unemployment Dynamics”. Journal of Risk and Financial Management 12 (1): 20. https://doi.
org/10.3390/jrfm12010020.
X ———. 2022a. “The AI Trilemma: Saving the Planet without Ruining Our Jobs”. Frontiers in
Artificial Intelligence, 19 October 2022. https://doi.org/10.3389/frai.2022.886561.
X ———. 2022b. “How Much Is an Elephant Worth? Valuing Natural Capital to Protect Nature
and Improve Wellbeing”. OECD Development Matters, 5 January 2022. https://oecd-development-
matters.org/2022/01/05/how-much-is-an-elephant-worth-valuing-natural-capital-to-protect-
nature-and-improve-wellbeing/.
X Ernst, E., M. Schörling, and L. Achtnich. 2022. “How to Transition to a Green Economy”.
UN Today, 22 November 2022. https://untoday.org/how-to-transition-to-a-green-economy/.
X Escudero, V. 2018. “Are Active Labour Market Policies Effective in Activating and Integrating
Low-Skilled Individuals? An International Comparison”. IZA Journal of Labor Policy 7: 4.
X Escudero, V., J. Kluve, E. Lopez Mourelo, and C. Pignatti. 2019. “Active Labour Market
Programmes in Latin America and the Caribbean: Evidence from a Meta-analysis”. Journal
of Development Studies 55 (12): 2644–2661.
X European Central Bank. 2021. “Scarring Effects of the COVID-19 Pandemic on the Global
Economy: Reviewing Recent Evidence”, ECB Economic Bulletin 7/2021.
X European Commission. 2020. Productivity in Europe: Trends and Drivers in a Service-Based
Economy. JRC Technical Report, JRC119785. https://publications.jrc.ec.europa.eu/repository/
handle/JRC119785.
X ———. 2022. “Science, Research and Innovation Performance of the EU: 2022”. In Industrial
Performance and Investment in Intangible Assets during Crises.
X Farooq, A., A. Kugler, and U. Muratori. 2020. “Do Unemployment Insurance Benefits Improve
Match Quality? Evidence from Recent U.S. Recessions”, NBER Working Paper No. 27574.
https://www.nber.org/system/files/working_papers/w27574/revisions/w27574.rev0.pdf.
X Fedotenkov, I., V. Kvedaras, and M. Sanchez-Martinez. 2022. “Employment Protection and
Labour Productivity Growth in the EU: Skill-Specific Effects during and after the Great Recession”,
JRC Working Paper in Economics and Finance 2022/4, JRC129023. https://joint-research-centre.
ec.europa.eu/system/files/2022-05/JRC129023.pdf.
X Feldstein, Martin. 2017. “Underestimating the Real Growth of GDP, Personal Income, and
Productivity”. Journal of Economic Perspectives 31 (2): 145–164.
X Fernald, J., and R. Inklaar. 2020. “Does Disappointing European Productivity Growth Reflect a
Slowing Trend? Weighing the Evidence and Assessing the Future”, Federal Reserve Bank of San
Francisco Working Paper 2020-22. https://www.frbsf.org/economic-research/wp-content/uploads/
sites/4/wp2020-22.pdf.
X Fossen, Frank M., Daniel Samaan, and Alina Sorgner. 2022. “How Are Patented AI, Software
and Robot Technologies Related to Wage Changes in the United States?” Frontiers, 14 June 2022.
https://www.frontiersin.org/articles/10.3389/frai.2022.869282/full.
X Frey, Carl Benedikt, and Michael A. Osborne. 2017. “The Future of Employment: How
Susceptible Are Jobs to Computerisation?” Technological Forecasting and Social Change 114
(January): 254–280.
X Furceri, D. 2005. “β and σ-Convergence: A Mathematical Relation of Causality”. Economics Letters
89 (2): 212–215.
X Furman, J., and P. Orszag. 2015. “A Firm-Level Perspective on the Role of Rents in the Rise in
Inequality.” Paper presented at Columbia University’s “A Just Society” Centennial Event in Honor of
Joseph Stiglitz, New York, NY, 16 October 2015.
X Gallie, D. 2012. “Skills, Job Control and the Quality of Work: The Evidence from Britain”. Economic
and Social Review 43 (3): 325–341.
X Gallie, D., and Z. Ying. 2013. “Job Control, Work Intensity, and Work Stress”. In Economic Crisis,
Quality of Work, and Social Integration: The European Experience, edited by D. Gallie. Oxford: Oxford
University Press.
X Georgiadis, A. 2013. “Efficiency Wages and the Economic Effects of the Minimum Wage:
Evidence from a Low-Wage Labour Market”. Oxford Bulletin of Economics and Statistics 75 (6):
962–979.
X Georgieva, Kristalina, and Tobias Adrian. 2022. “Public Sector Must Play Major Role in Catalyzing
Climate Finance”. IMF Blog, 18 August 2022. https://www.imf.org/en/Blogs/Articles/2022/08/18/
public-sector-must-play-major-role-in-catalyzing-private-climate-finance.
X Goldin, I., P. Koutroumpis, F. Lafond, and J. Winkler. Forthcoming. “Why Is Productivity Slowing
Down?” Journal of Economic Literature.
X Gordon, R.J. 2013. “U.S. Productivity Growth: The Slowdown Has Returned after a Temporary
Revival”. International Productivity Monitor 25: 13–19. https://ideas.repec.org/a/sls/ipmsls/
v25y20132.html.
X ———. 2017. The Rise and Fall of American Growth: The U.S. Standard of Living since the Civil War.
Princeton, NJ: Princeton University Press.
X Gordon, R.J., and H. Sayed. 2019. “The Industry Anatomy of the Transatlantic Productivity
Growth Slowdown: Europe Chasing the American Frontier”. International Productivity Monitor 37:
3–38.
X ———. 2020. “Transatlantic Technologies: The Role of ICT in the Evolution of U.S. and European
Productivity Growth”. International Productivity Monitor 38: 50–80. https://ideas.repec.org/a/sls/
ipmsls/v38y20203.html.
X Goulas, E., and A. Zervoyianni, A. 2018. “Active Labour-Market Policies and Output Growth:
Is There a Causal Relationship?” Economic Modelling 73: 1–14.
X Greenspon, J., A. Stansbury, and L.H. Summers. 2021. “Productivity and Pay in the United States
and Canada”. International Productivity Monitor 41: 3–30.
X Gust, S., A. Hanushek, and L. Woessmann. 2022. “Global Universal Basic Skills: Current Deficits
and Implications for World Development”, RISE Working Paper 22/114. https://riseprogramme.
org/sites/default/files/publications/Global_Universal_Basic_Skills.pdf.
X Gutierrez, G., and T. Philippon. 2017. “Declining Competition and Investment in the U.S.” NBER
Working Paper No. 23583. https://www.nber.org/system/files/working_papers/w23583/w23583.
pdf.
X Hallward-Driemeier, Mary, and Gaurav Nayyar. 2018. Trouble in the Making? The Future
of Manufacturing-Led Development. World Bank. https://www.worldbank.org/en/topic/
competitiveness/publication/trouble-in-the-making-the-future-of-manufacturing-led-
development.
X Hanushek, E., and L. Woessmann. 2020. “The Economic Impacts of Learning Losses”, OECD
Education Working Paper 225. https://www.oecd.org/education/The-economic-impacts-of-
coronavirus-covid-19-learning-losses.pdf.
X Hartwig, J. 2011. “Testing the Baumol–Nordhaus Model with EU KLEMS Data”. Review of Income
and Wealth 57 (3): 471–489.
X Haskel, Jonathan, and Stian Westlake. 2018. Capitalism without Capital: The Rise of the Intangible
Economy. Princeton, NJ: Princeton University Press.
X ILO. 2012. “Wage-Led or Profit-Led Supply: Wages, Productivity and Investment”, Conditions of
Work and Employment Series No. 36. https://www.ilo.org/travail/info/publications/WCMS_187309/
lang--en/index.htm.
X ———. 2017. World Employment Social Outlook. Sustainable Enterprises and Jobs: Formal Enterprises
and Decent Jobs. https://www.ilo.org/wcmsp5/groups/public/---dgreports/---dcomm/---publ/
X ———. 2018. Digital Labour Platforms and the Future of Work: Towards Decent Work in the Online
World. https://www.ilo.org/wcmsp5/groups/public/---dgreports/---dcomm/---publ/documents/
publication/wcms_645337.pdf.
X ———. 2019. Skills and Jobs Mismatches in Low- and Middle-Income Countries. https://www.ilo.org/
wcmsp5/groups/public/---ed_emp/documents/publication/wcms_726816.pdf.
X ———. 2020a. Driving Up Productivity: A Guide for Employer and Business Membership
Organizations. https://www.ilo.org/actemp/publications/WCMS_758749/lang--en/index.htm.
X ———. 2020b. Global Employment Trends for Youth 2020: Technology and the Future of Jobs. https://
www.ilo.org/global/publications/books/WCMS_737648/lang--en/index.htm.
X ———. 2020c. Global Wage Report 2020–21: Wages and Minimum Wages in the Time of COVID-19.
https://www.ilo.org/global/research/global-reports/global-wage-report/2020/lang--en/index.htm.
X ———. 2021a. “Who Moves and Who Stays? Labour Market Transitions under Automation and
Health-Related Restrictions”, ILO Research Brief. https://www.ilo.org/global/research/publications/
WCMS_829500/lang--en/index.htm.
X ———. 2021b. “Decent Work and Productivity”. Governing Body, 341st Session. https://www.ilo.
org/wcmsp5/groups/public/---ed_norm/---relconf/documents/meetingdocument/wcms_769282.pdf.
X ———. 2022a. World Employment and Social Outlook: Trends 2022. https://www.ilo.org/global/
X ———. 2022b. Productivity Growth, Diversification and Structural Change in the Arab States. https://
www.ilo.org/actemp/publications/WCMS_840588/lang--en/index.htm.
X ———. 2022c. Digital Transition, Technological Change and Productive Development Policies in LAC:
Challenges and Opportunities. https://www.ilo.org/americas/publicaciones/WCMS_849272/lang--
en/index.htm.
X ———. 2022d. “Using Online Vacancy and Job Applicants’ Data to Study Skills Dynamics”, ILO
Working Paper 75. https://www.ilo.org/wcmsp5/groups/public/---dgreports/---inst/documents/
publication/wcms_853821.pdf.
X ———. 2022e. Violence and Harassment at Work: A Practical Guide for Employers. https://www.ilo.
org/wcmsp5/groups/public/---ed_dialogue/---act_emp/documents/publication/wcms_857915.pdf.
X ———. 2022f. Social Dialogue Report 2022. https://www.ilo.org/global/research/global-reports/
social-dialogue/2022/lang--en/index.htm.
X ILO and UNEP (United Nations Environment Programme). 2022. Decent Work in Nature-Based
Solutions 2022. https://www.ilo.org/wcmsp5/groups/public/---ed_emp/documents/publication/
wcms_863035.pdf.
X IMF. 2022. World Economic Outlook: Countering the Cost-of-Living Crisis. https://www.imf.org/en/
Publications/WEO/Issues/2022/10/11/world-economic-outlook-october-2022.
X Isham, A., S. Mair, and T. Jackson. 2020. “Well-Being and Productivity: A Review of the Literature”,
CUSP Working Paper No 22.
X Jimeno, J.F., 2019. “Fewer Babies and More Robots: Economic Growth in a New Era of
Demographic and Technological Changes”. Journal of the Spanish Economic Association 10: 93–114.
https://doi.org/10.1007/s13209-019-0190-z.
X Karahan, F., B. Pugsley, and A. Şahin, A. 2019. “Demographic Origins of the Startup Deficit”,
Federal Reserve Bank of New York Staff Report No. 888. https://www.newyorkfed.org/
medialibrary/media/research/staff_reports/sr888.pdf.
X Katsuro, P., C.T. Gadziray, M. Taruwona, and S. Mupararano. 2010. “Impact of Occupational
Health and Safety on Worker Productivity: A Case of Zimbabwe Food Industry”. African Journal of
Business Management 4 (13): 2644–2651.
X Kose, M.A., F. Ohnsorge, S. Ye Lei, and E. Islamaj. 2017. “Weakness in Investment Growth:
Causes, Implications and Policy Responses”, CAMA Working Paper 19/2017. https://cama.
crawford.anu.edu.au/sites/default/files/publication/cama_crawford_anu_edu_au/2017-
03/19_2017_kose_ohnsorge_ye_islamaj_0.pdf.
X Krugman, Paul. 1992. The Age of Diminished Expectations: U.S. Economic Policy in the 1990s.
Cambridge, MA: MIT Press.
X Ku, H. 2020. “Does Minimum Wage Increase Labor Productivity? Evidence from Piece Rate
Workers”, IZA Discussion Paper No. 13369. https://docs.iza.org/dp13369.pdf.
X Kumar, A., and B. Kober. 2012. “Education, Health, and Cross-Country Productivity Differences”.
Economic Letters 117 (1): 14–17.
X Landmann, O. 2004. “Employment, Productivity and Output Growth”, ILO Employment Strategy
Papers 2004/17. https://www.ilo.org/empelm/pubs/WCMS_114299/lang--en/index.htm.
X Lewandowski, P., A. Park, W. Hardy, and Y. Du. 2022. “Technology, Skills, and Globalization:
Explaining International Differences in Routine and Nonroutine Work Using Survey Data”. World
Bank Economic Review 36 (3): 687–708.
X Lewandowski, P., A. Park, and S. Schotte, S. 2020. “The Global Distribution of Routine and
Non‑routine Work”, IZA Discussion Paper No. 13384. https://docs.iza.org/dp13384.pdf.
X Liang, J., H. Wang, and E.P. Lazear. 2018. “Demographics and Entrepreneurship”. Journal of
Political Economy 126 (S1): S140–S196.
X Maestas, N., K.J. Mullen, and D. Powell. 2016. “The Effect of Population Aging on Economic
Growth, the Labor Force and Productivity”, NBER Working Paper 22452. https://www.nber.org/
papers/w22452.
X Mayneris, F., S. Poncet, and T. Zhang. 2014. “The Cleansing Effect of Minimum Wage: Minimum
Wage Rules, Firm Dynamics and Aggregate Productivity in China”, CEPII Working Paper
No. 2014‑16. http://www.cepii.fr/PDF_PUB/wp/2014/wp2014-16.pdf.
X Mazzucato, M. 2013. The Entrepreneurial State: Debunking Public vs. Private Sector Myths. London:
Anthem Press.
X ———. 2022. Mission Economy: A Moonshot Guide to Changing Capitalism. London: Penguin.
X McAfee, A., and E. Brynjolfsson. 2008. “Investing in the IT that Makes a Competitive Difference”.
Harvard Business Review 86 (7): 98–107.
X McKinsey. 2022. “Human Capital at Work: The Value of Experience”, 2 June 2022. https://www.
mckinsey.com/capabilities/people-and-organizational-performance/our-insights/human-capital-
at-work-the-value-of-experience.
X Merola, R. 2022. “Inclusive Growth in the Era of Automation and AI: How Can Taxation Help?”
Frontiers of Artificial Intelligence 5: 867832.
X Miranda, Javier, John Haltiwanger, Ron Jarmin, and Ryan Decker. 2018. “Leaving Money on the
Table: Declining Responsiveness and the Productivity Slowdown”. Vox EU, 12 July 2018. https://
cepr.org/voxeu/columns/leaving-money-table-declining-responsiveness-and-productivity-
slowdown.
X Niebel, T., M. O’Mahony, and M. Saam. 2017. “The Contribution of Intangible Assets to Sectoral
Productivity Growth in the EU”. Review of Income and Wealth 63 (1): 49–67.
X Nordhaus, W.D. 2005. “The Sources of the Productivity Rebound and the Manufacturing
Employment Puzzle”, NBER Working Paper No. 11354.
X ———. 2008. “Baumol’s Diseases: A Macroeconomic Perspective”. B.E. Journal of Macroeconomics
8 (1): 1–39.
X Nübler, I. 2014. “Social Policy and Productive Transformation: Linking Education with Industrial
Policy”. Paper prepared for the UNRISD Conference, New Directions in Social Policy: Alternatives
from and for the Global South, Geneva, 7–8 April 2014.
X OECD. 2015. The Future of Productivity.
X ———. 2018. The Productivity–Inclusiveness Nexus. https://doi.org/10.1787/9789264292932-en.
X ———. 2019a. “Rethink Policy for a Changing World!” OECD Economic Outlook, November 2019.
https://www.oecd.org/economic-outlook/november-2019/.
X ———. 2019b. “A New Macroeconomic Measure of Human Capital with Strong Empirical
Links to Productivity”, Economics Department Working Paper No. 1575. https://www.oecd.org/
officialdocuments/publicdisplaydocumentpdf/?cote=ECO/WKP(2019)45&docLanguage=En.
X ———. 2019c. “The Role of Collective Bargaining Systems for Labour Market Performance”.
In Negotiating Our Way Up: Collective Bargaining in a Changing World of Work. https://doi.
org/10.1787/1fd2da34-en.
X ———. 2020. OECD Digital Economy Outlook 2020. https://www.oecd.org/digital/oecd-digital-
economy-outlook-2020-bb167041-en.htm.
X ———. 2021. “Business Dynamism during the COVID-19 Pandemic: Which Policies for an
Inclusive Recovery?” OECD Policy Responses to Coronavirus (COVID-19), 18 February 2021.
https://www.oecd.org/coronavirus/policy-responses/business-dynamism-during-the-covid-19-
pandemic-which-policies-for-an-inclusive-recovery-f08af011/.
X ———. 2022. “Paying the Price of War”. OECD Economic Outlook, September 2022.
https://www.oecd.org/economic-outlook/september-2022/.
X OECD and ILO. 2019. “Informality in the Development Process”. In Tackling Vulnerability in the
Informal Economy. https://doi.org/10.1787/939b7bcd-en.
X O’Mahony, M., and M.P. Timmer. 2009. “Output, Input and Productivity Measures at the Industry
Level: The EU KLEMS Database”. Economic Journal 119 (538): F374–F403.
X Oseni, G., K. McGee, and A. Dabalen. 2014. “Can Agricultural Households Farm Their Way out
of Poverty?” World Bank Policy Research Working Paper 7093. https://documents.worldbank.
org/en/publication/documents-reports/documentdetail/909941468096548521/can-agricultural-
households-farm-their-way-out-of-poverty.
X Page, J., J. Gutman, P. Madden, and D. Gandhi. 2020. “Urban Economic Growth in Africa: A
Framework for Analyzing Constraints to Agglomeration”, Africa Growth Initiative Working Paper
No. 24. https://www.brookings.edu/research/urban-economic-growth-in-africa-a-framework-for-
analyzing-constraints-to-agglomeration/.
X Patel, D., J. Sandefur, and A. Subramanian. 2021. “The New Era of Unconditional Convergence”.
Journal of Development Economics 152 (September): 102687.
X Petropoulos, G. 2022. “The ICT Revolution and the Future of Innovation and Productivity”. In
Global Innovation Index 2022, 15th Edition: What Is the Future of Innovation Driven growth? WIPO.
X Poplawski-Ribeiro, M. 2020. “Labour Force Ageing and Productivity Growth”. Applied Economics
Letters 27 (6): 498–502.
X Productivity Institute. 2021. “Editors’ Overview”. International Productivity Monitor 40: 1–2.
https://www.productivity.ac.uk/wp-content/uploads/2021/06/2.-IPM_40_EditorsOverview.pdf.
X Riley, R., and C.R. Bondibene. 2015. “Raising the Standard: Minimum Wages and Firm
Productivity”, National Institute of Economic and Social Research Discussion Paper No 449.
https://www.niesr.ac.uk/wp-content/uploads/2021/10/Minimum-wages-and-firm-productivity-
NIESR-DP-449-4.pdf.
X Rizov, M., R. Croucher, and T. Lange. 2016. “The UK National Minimum Wage’s Impact on
Productivity”. British Journal of Management 24 (4): 819–835. https://doi.org/10.1111/1467-
8551.12171.
X Roth, F. 2019. “Intangible Capital and Labour Productivity Growth: A Review of the Literature”,
Hamburg Discussion Papers in International Economics No. 4. https://www.econstor.eu/
bitstream/10419/207163/1/hdpie-no04.pdf.
X Saha, S. 2013. “Impact of Health on Productivity Growth in India”. International Journal of
Economics, Finance and Management 2 (4): 303–312.
X Salazar-Xirinachs, J., I. Nübler, and R. Kozul-Wright. 2014. Transforming Economies: Making
Industrial Policy Work for Growth, Jobs and Development. ILO. https://www.ilo.org/global/
publications/ilo-bookstore/order-online/books/WCMS_242878/lang--en/index.htm.
X Sanchez-Martinez, M., and M. Christensen. 2022. “Medium-to-Long Term Macroeconomic
Effects of the COVID Crisis: An Investigation with RHOMOLO”, JRC Working Papers on Territorial
Modelling and Analysis No. 11/2022, JRC126447. https://joint-research-centre.ec.europa.eu/
publications/medium-long-term-macroeconomic-effects-covid-crisis-investigation-rhomolo_en.
X Semmler, W., and P. Chen. 2018. “Short and Long Effects of Productivity on Unemployment”.
Open Economies Review 29: 853–878.
X Sharpe, A., and S. Mobasher Fard. 2022. “The Current State of Research on the Two-Way
Linkages between Productivity and Well-Being”, ILO Working Paper 56. https://www.ilo.org/
wcmsp5/groups/public/---dgreports/---inst/documents/publication/wcms_839845.pdf.
X Solow, R. 1957. “Technical Change and the Aggregate Production Function”. Review of Economics
and Statistics 39 (3): 312–320.
X Song, J., D.J. Price, F. Guvenen, N. Bloom, and T. von Wachter, T. 2018. “Firming Up Inequality”.
Quarterly Journal of Economics 134 (1): 1–50. https://doi.org/10.1093/qje/qjy025.
X Stewart, Jay. 2022. “Why Was Labor Productivity Growth So High during the COVID-19
Pandemic? The Role of Labor Composition”, BLS Working Paper 545. https://www.bls.gov/osmr/
research-papers/2022/pdf/ec220010.pdf.
X Stoevska, Valentina. 2021. “Only Half of Workers Worldwide Hold Jobs Corresponding to Their
Level of Education”. ILOSTAT, 17 September 2021. https://ilostat.ilo.org/only-half-of-workers-
worldwide-hold-jobs-corresponding-to-their-level-of-education/.
X Summers, Lawrence H. 2015. “Demand Side Secular Stagnation”. American Economic Review 105
(5): 60–65.
X Syverson, Chad. 2017. “Challenges to Mismeasurement Explanations for the US Productivity
Slowdown”. Journal of Economic Perspectives 31 (2): 165–186. https://doi.org/10.1257/jep.31.2.165.
X Tambe, P., L. Hitt, D. Rock, and E. Brynjolfsson. 2020. “Digital Capital and Superstar Firms”, NBER
Working Paper 28285. https://www.nber.org/system/files/working_papers/w28285/w28285.pdf.
X Thatcher, M., and T. Vlandas. 2022. Foreign States in Domestic Markets: Sovereign Wealth Funds
and the West. Oxford: Oxford University Press.
X Valero, A. 2021. “Education and Economic Growth”, Centre for Economic Performance
Discussion Paper No. 1764. https://files.eric.ed.gov/fulltext/ED614082.pdf.
X Van Ark, B. 2016. “The Productivity Paradox of the New Digital Economy”. International
Productivity Monitor 31: 3–18.
X Van Ark, B., and M. Fleming. 2022. “Will the Fourth Industrial Revolution Deliver as Promised?”
In Global Innovation Index 2022, 15th Edition: What Is the Future of Innovation Driven Growth? WIPO.
X Vandenberg, P. 2004. “Productivity, Decent Employment and Poverty: Conceptual and Practical
Issues Related to Small Enterprises”, SEED Working Paper No. 67. https://www.ilo.org/wcmsp5/
groups/public/---ed_emp/---emp_ent/documents/publication/wcms_103462.pdf.
X Viviani, C.A., G. Bravo, M. Lavalliere, P.M. Arezes, M. Martinez, I. Dianat, S. Braganca, and
H.I. Castellucci. 2021. “Productivity in Older versus Younger Workers: A Systematic Literature
Review”. Work 68 (3): 577–618.
X Vollrath, D. 2020. Fully Grown: Why a Stagnant Economy Is a Sign of Success. Chicago, IL: University
of Chicago Press.
X Walsh, C.E. 2004. “The Productivity and Jobs Connection: The Long and the Short Run of It”,
FRBSF Economic Letter 2004-18.
X Wang, K., Y. Zhu, and J. Zhang. 2021. “Decoupling Economic Development from Municipal Solid
Waste Generation in China’s Cities: Assessment and Prediction Based on Tapio Method and EKC
Models”. Waste Management 133: 37–48.
X Wang, R., V.A. Assenova, and E.G. Hertwich. 2021. “Energy System Decarbonization and
Productivity Gains Reduced the Coupling of CO2 Emissions and Economic Growth in 73 Countries
between 1970 and 2016”. One Earth 4 (11): 1614–1624.
X Weil, D. 2006. “Accounting for the Effect of Health on Economic Growth”, NBER Working Paper
No. 11455. https://www.nber.org/system/files/working_papers/w11455/w11455.pdf.
X WIPO (World Intellectual Property Organization). 2020. “Sovereign Wealth Funds and
Innovation Investing in an Era of Mounting Uncertainty”. In Global Innovation Index 2020.
Appendices
X Appendix A. Groupings of countries by region and income level
Africa Americas Asia and the Pacific Europe and Central Asia
North Africa Latin America East Asia Northern, Southern

Algeria and the Caribbean China and Western Europe
Egypt Argentina Democratic People’s Republic Albania
Libya Bahamas of Korea Austria
Morocco Barbados Hong Kong, China Belgium
Sudan Belize Japan Bosnia and Herzegovina
Tunisia Bolivia (Plurinational State of) Macau, China Channel Islands
Western Sahara Brazil Mongolia Croatia
Chile Republic of Korea Denmark
Sub-Saharan Africa Colombia Taiwan, China Estonia
Angola Costa Rica Finland
Benin Cuba South-East Asia France
Botswana Dominican Republic Brunei Darussalam Germany
Burkina Faso Ecuador Cambodia Greece
Burundi El Salvador Indonesia Iceland
Cabo Verde Guatemala Lao People’s Democratic Republic Ireland
Cameroon Guyana Malaysia Italy
Central African Republic Haiti Myanmar Latvia
Chad Honduras Philippines Lithuania
Comoros Jamaica Singapore Luxembourg
Congo Mexico Thailand Malta
Côte d’Ivoire Nicaragua Timor-Leste Montenegro
Democratic Republic of the Congo Panama Viet Nam Netherlands
Djibouti Paraguay North Macedonia
Equatorial Guinea Peru The Pacific Norway
Eritrea Puerto Rico Australia Portugal
Eswatini Saint Lucia Fiji Serbia
Ethiopia Saint Vincent and the Grenadines French Polynesia Slovenia
Gabon Suriname Guam Spain
Gambia Trinidad and Tobago New Caledonia Sweden
Ghana United States Virgin Islands New Zealand Switzerland
Guinea Uruguay Papua New Guinea United Kingdom
Guinea-Bissau Venezuela (Bolivarian Republic of) Samoa
Kenya Solomon Islands Eastern Europe
Lesotho North America Tonga Belarus
Liberia Canada Vanuatu Bulgaria
Madagascar United States Czechia
Malawi South Asia Hungary
Mali Afghanistan Poland
Arab States
Mauritania Bangladesh Republic of Moldova
Mauritius Bahrain Bhutan Romania
Mozambique Iraq India Russian Federation
Namibia Jordan Iran (Islamic Republic of) Slovakia
Niger Kuwait Maldives Ukraine
Nigeria Lebanon Nepal
Rwanda Occupied Palestinian Territory Pakistan Central and Western Asia
Sao Tome and Principe Oman Sri Lanka Armenia
Senegal Qatar Azerbaijan
Sierra Leone Saudi Arabia Cyprus
Somalia Syrian Arab Republic Georgia
South Africa United Arab Emirates Israel
South Sudan Yemen Kazakhstan
Togo Kyrgyzstan
Uganda Tajikistan
United Republic of Tanzania Türkiye
Zambia Turkmenistan
Zimbabwe Uzbekistan
Appendix A. Groupings of countries by region and income level 129
High-income countries Upper-middle-income countries Lower-middle-income countries Low-income countries
Australia Albania Angola Afghanistan

Austria Algeria Bangladesh Burkina Faso
Bahamas Argentina Benin Burundi
Bahrain Armenia Bhutan Central African Republic
Barbados Azerbaijan Bolivia (Plurinational State of) Chad
Belgium Belarus Cabo Verde Democratic People’s Republic
Brunei Darussalam Belize Cambodia of Korea
Canada Bosnia and Herzegovina Cameroon Democratic Republic of the Congo
Channel Islands Botswana Comoros Eritrea
Chile Brazil Congo Ethiopia
Croatia Bulgaria Côte d’Ivoire Gambia
Cyprus China Djibouti Guinea
Czechia Colombia Egypt Guinea-Bissau
Denmark Costa Rica El Salvador Liberia
Estonia Cuba Eswatini Madagascar
Finland Dominican Republic Ghana Malawi
France Ecuador Haiti Mali
French Polynesia Equatorial Guinea Honduras Mozambique
Germany Fiji India Niger
Greece Gabon Indonesia Rwanda
Guam Georgia Iran (Islamic Republic of) Sierra Leone
Hong Kong, China Guatemala Kenya Somalia
Hungary Guyana Kyrgyzstan South Sudan
Iceland Iraq Lao People’s Democratic Republic Sudan
Ireland Jamaica Lebanon Syrian Arab Republic
Israel Jordan Lesotho Togo
Italy Kazakhstan Mauritania Uganda
Japan Libya Mongolia Yemen
Kuwait Malaysia Morocco Zambia
Latvia Maldives Myanmar
Lithuania Mauritius Nepal
Luxembourg Mexico Nicaragua
Macau, China Montenegro Nigeria
Malta Namibia Occupied Palestinian Territory
Netherlands North Macedonia Pakistan
New Caledonia Paraguay Papua New Guinea
New Zealand Peru Philippines
Norway Republic of Moldova Samoa
Oman Russian Federation Sao Tome and Principe
Panama Saint Lucia Senegal
Poland Saint Vincent and the Grenadines Solomon Islands
Portugal Serbia Tajikistan
Puerto Rico South Africa Timor-Leste
Qatar Sri Lanka Tunisia
Republic of Korea Suriname Ukraine
Romania Thailand United Republic of Tanzania
Saudi Arabia Tonga Uzbekistan
Singapore Türkiye Vanuatu
Slovakia Turkmenistan Viet Nam
Slovenia Venezuela (Bolivarian Republic of) Western Sahara
Spain Zimbabwe
Sweden
Switzerland
Taiwan, China
Trinidad and Tobago
United Arab Emirates
United Kingdom
United States
United States Virgin Islands
Uruguay
X Appendix B. ILO modelled estimates
The source of all the global and regional labour similar across countries and present the highest
market estimates presented in this World data quality. Hence, the data derived from such
Employment and Social Outlook report is the ILO surveys are more readily comparable than data
modelled estimates as of November 2022. The obtained from other sources. Strict preference is
ILO has designed and actively maintains a series therefore given to labour-force-survey-based data
of econometric models that are used to produce in the selection process. However, many developing
estimates of labour market indicators in the countries, which lack the resources to carry out
countries and years for which country-reported a labour force survey, do report labour market
data are unavailable. The purpose of estimating information on the basis of other types of house-
labour market indicators for countries with missing hold survey or population census. Consequently,
data is to obtain a balanced panel data set so that, because of the need to balance the competing
every year, regional and global aggregates with goals of data comparability and data coverage,
consistent country coverage can be computed. some (non-labour-force-survey) household survey
These allow the ILO to analyse global and regional data and, more rarely, population-census-based
estimates of key labour market indicators and re- data are included in the models.
lated trends. Moreover, the resulting country-level
The second criterion is that only nationally repre-
data, combining both reported and imputed ob-
sentative (that is, not geographically limited) labour
servations, constitute a unique, internationally
market indicators are included. Observations
comparable data set on labour market indicators.
corresponding to only urban or only rural areas are
not included, because large differences typically
Data collection and evaluation exist between rural and urban labour markets, and
the use of only rural or only urban data would not
The ILO modelled estimates are generally derived be consistent with benchmark data such as GDP.
for 189 countries and are disaggregated by sex and
The third criterion is that the age groups covered
age as appropriate. Before running the models to
by the observed data must be sufficiently com-
obtain the estimates, labour market information
parable across countries. Countries report labour
specialists from the ILO Department of Statistics,
market information for a variety of age groups, and
in cooperation with the Research Department,
the age group selected can influence the observed
evaluate existing country-reported data and
value of a given labour market indicator.
select only those observations deemed sufficiently
comparable across countries. The recent efforts The last criterion for excluding data from a
by the ILO to produce harmonized indicators given model is whether a methodological break
from country-reported microdata have greatly is present or a particular data point is clearly
increased the comparability of the observations. an outlier. In both cases, a balance has to be
Nonetheless, it is still necessary to select the data struck between using as much data as possible
on the basis of the following four criteria: (a) type and omitting observations likely to distort the
of data source; (b) geographical coverage; (c) age results. During this process, particular attention
group coverage; and (d) presence of methodo- is paid to the existing metadata and the under-
logical breaks or outliers. lying methodology for obtaining the data point
under consideration.
With regard to the first criterion, in order for labour
market data to be included in a particular model, Historical estimates can be revised in cases where
they must be derived from a labour force survey, previously used input data are discarded because a
a household survey or, more rarely, a population source has become available that is more accurate
census. National labour force surveys are generally according to the above-mentioned criteria.
Appendix B. ILO modelled estimates 131
General methodology used there are differences between the various models
because of specific features of the underlying data.
to estimate labour market Further details are provided below for each model.
indicators
Labour market indicators are estimated using a Models used to estimate
series of models that establish statistical relation- labour market indicators
ships between observed labour market indicators
and explanatory variables. These relationships are Labour force estimates
used to impute missing observations and to make
projections for the indicators. Methodological changes are introduced in the
current version of the labour force participation
There are many potential statistical relationships,
rate (LFPR) model in order to produce more
also called “model specifications”, that could be
granular age breakdowns. The basic data used
used to predict labour market indicators. The key
as input for the LFPR model are single-year LFPRs
to obtaining accurate and unbiased estimates
disaggregated by sex and age groups, the latter
is to select the best model specification in each
comprising four intervals (15–24, 25–54, 55–64
case. The ILO modelled estimates generally rely
and 65+). Compared with earlier years when only
on a procedure called “cross-validation”, which is
two intervals were available (15–24 and 25+), the
used to identify those models that minimize the
additional age groups significantly increase the
expected error and variance of the estimation. This
amount of input data. Moreover, estimates for
procedure involves repeatedly computing a number
the 25+ age group can still be recovered with the
of candidate model specifications using random
new methodology. The underlying methodology
subsets of the data: the missing observations are
has been extensively assessed in terms of pseudo-
predicted and the prediction error is calculated for
each iteration. Each candidate model is assessed on out-of-sample performance. However, for certain
the basis of the pseudo-out-of-sample root mean types of missing data patterns, the LFPR and the
square error, although other metrics such as result unemployment rate models are the only two
stability are also assessed depending on the model. models described in this appendix which do not
This makes it possible to identify the statistical carry out automatized model selection.
relationship that provides the best estimate of a Linear interpolation is used to fill in the missing
given labour market indicator. It is worth noting data for countries for which such a procedure is
that the most appropriate statistical relationship for possible. This procedure produces accurate esti-
this purpose may differ according to the country. mates of low variance, which is not surprising,
The extraordinary disruptions of the global labour given that the LFPR is a very persistent variable.
market caused by the COVID-19 crisis have ren- In all other cases, weighted multivariate estima-
dered the series of models underlying the ILO tion is carried out. Countries are divided into nine
modelled estimates less suitable for estimating estimation groups, chosen on the combined basis
and projecting the evolution of labour market indi- of broad economic similarity and geographical
cators. For this reason, the methodology has been proximity. On the basis of the data structure
adapted, and explanatory variables that are specific and the heterogeneity among the countries cov-
to the COVID-19 crisis have been introduced into ered by the input data, the model was specified
the modelling process. using panel data with country fixed effects. The
regressions are weighted by the inverse of the
The benchmark for the ILO modelled estimates
likelihood of a labour force survey’s availability. The
is the 2022 Revision of the United Nations World
explanatory variables used include economic and
Population Prospects, which provides estimates
demographic variables. To produce estimates for
and projections of the total population broken
2020, a cross-validation approach is used to select
down into five-year age groups. The working-age
the model that minimizes prediction error in that
population comprises everyone who is at least
specific year. The tested models include annual
15 years of age.
averages of high-frequency indicators related
Although the same basic approach is followed in to the evolution of the COVID-19 pandemic. An
the models used to estimate all the indicators, additional module is used to produce estimates
for the recovery year 2021. In addition to the cross- Jobs gap
validation procedure for model selection, macro-
economic and labour market indicators are utilized The aim of the model is to provide aggregate esti-
to estimate a smooth recovery while accounting mates of the jobs gap rate by sex for the population
for the pre-2020 trend. The global figures are aged 15 or older. The jobs gap rate is the target
calculated using the benchmark population from variable estimated for countries with missing data
the United Nations World Population Prospects and is computed as follows:
and the LFPRs.
(Unemployed + Potential labour force
Rebalancing the estimates ensures that the implied + Willing non-jobseekers)
Jobs gap rate =
total rate obtained from summing the demographic (Labour force + Potential labour force
breakdowns matches the total rate derived from + Willing non-jobseekers)
the labour force surveys or estimated.
where the potential labour force and willing
non-jobseekers include persons who were seeking
Unemployment estimates employment and were not available but would
become available in a short time (unavailable
This model estimates a complete panel data set
jobseekers), persons who were not seeking work
of unemployment rates disaggregated by sex
but were currently available (available potential
and age (15–24, 25+). For countries for which at
jobseekers) and persons who were not seeking
least one observation is reported,1 regressions
work and were not available but were willing to
involving country fixed effects are used. Three
work (willing non-jobseekers).
models are combined with equal weighting in
order to impute missing values. The models The imputations for missing data are produced
have been chosen on the basis of pseudo-out- through four separate econometric models. First,
of-sample root mean square error and stability of a model produces estimates from 2004 to 2019 for
results (the two components are weighted using countries with at least one yearly data point for the
expert judgement). For countries with no reported jobs gap rate by sex. Second, a model produces
observations, models are selected on the basis estimates from 2004 to 2019 for those countries
of cross-validation. The evolution of the average with no data on the jobs gap rate during the entire
unemployment rate of a particular demographic period. The third and fourth models produce esti-
group in a particular region is highly predictive of mates for, respectively, the 2020 crisis year and the
the evolution of the unemployment rate of that recovery period of 2021–22.
particular group in a country in that region. A sep-
The four distinct models were chosen from an array
arate cross-validation approach is used to select
of candidate models on the basis of cross-validation,
the model that minimizes prediction error in the
which selects the models with the highest accuracy
year 2020. The candidate models include annual
in predicting the jobs gap rates in pseudo-out-
averages of high-frequency indicators related
of-sample simulations. The predictions from the
to the evolution of the COVID-19 pandemic. An
models are used to estimate the missing obser-
additional procedure is used to produce esti-
vations of the jobs gap rate by sex. Interpolation
mates for 2021 which also uses cross-validation
procedures are applied to the predictions to ensure
procedure to select models. These models ac-
that the model estimate coincides with the real
count for the historical trend and utilize macro-
observations and that imputed data are consistent
economic indicators, including the dynamics of
with real observations that are close in time. Since
the unemployment rate in 2020. The procedure
the models estimate the jobs gap rates for the total
shows unemployment to have displayed a smooth
population and for women and men separately,
recovery towards that historical trend in 2021.
the aggregated estimates for women and men
Rebalancing the estimates ensures that the implied may be incompatible with the total-population
total rate obtained from summing the demographic estimates. The subcomponents for women and
breakdowns matches the total rate derived from men are adjusted proportionally to match the
the labour force surveys or estimated. total-population estimates.
1 For ease of exposition, we abstract here from the case in which observations are reported for some demographic groups but
not for others in a given country and year.
Informal employment are either in employment or enrolled in some

educational or training programme. The NEET
The target variable of the model is the informality share is included as one of the indicators used to
rate disaggregated by sex for the population aged measure progress towards the achievement of the
15 and older. The informality estimates include both SDGs – specifically Goal 8 (“Promote sustained,
nationally reported observations and imputed data inclusive and sustainable economic growth, full
for countries with missing data. The gender-specific and productive employment and decent work
country-level data used for the models include for all”).
self-employment and part-time employment rates.
The country-level data include the percentage of The model uses the principles of cross-validation
people below various poverty lines, the share and uncertainty estimation to select the regres-
of employment in agriculture and industry, the sion models with the best pseudo-out-of-sample
urbanization rate, the logarithm of GDP per capita, performance, not unlike the unemployment rate
and categorical variables for geographical regions model. The NEET model estimates all demographic
and levels of economic development. groups jointly, using the appropriate categorical
variable as a control in the regression, because the
The imputations for missing data are produced groups are interdependent and data availability is
through five separate econometric models. First, roughly uniform across breakdowns. The model
a model produces estimates from 2004 to 2019 for incorporates the information on unemployment,
countries with at least one yearly data point for labour force and enrolment rates into the regres-
the share of informal employment by sex. Second, sions (using it alongside other variables to reflect
a model produces estimates from 2004 to 2019 economic and demographic factors). The resulting
for those countries with no data on the share of estimates include the NEET share and the number
informality during the entire period. The third and
of youth NEET.
fourth models are used to produce estimates for,
respectively, the 2020 crisis year and the recovery
period of 2021. The final model estimates the pro- Hours worked
jections for 2022. The five distinct models were
chosen from an array of candidate models based on The ratio of weekly hours worked to the population
cross-validation, which selects the models with the aged 15–64 is the target variable that is estimated
highest accuracy in predicting informality rates in for countries with missing data. Total weekly
pseudo-out-of-sample simulations. The predictions working hours are derived by multiplying this ratio
from the models are used to estimate the missing by the estimate of the population aged 15–64.
observations of the share of informal employment For estimates up to and including 2019, the regres-
by sex. Since the models estimate the informal sion approach uses the share of the population
rates for the total population and for women and aged 15–64 in the total population, the employ-
men separately, the aggregated estimates for ment-to-population ratio (EPR) and the rate of
women and men may be incompatible with the time-related underemployment to predict missing
total-population estimates. The subcomponents values. For countries with no observations of this
for women and men are adjusted proportionally indicator, the country intercept is estimated by
to match the total-population estimates. combining the regional mean and the income
group mean.
Youth not in employment, Working hours up to and including the third quarter
education or training of 2022 are estimated using the ILO nowcasting
model. This is a data-driven statistical prediction
The target variable of the model is the share of model that draws on the values of high-frequency
youth, the population aged 15 to 24, not in edu- indicators in real time or with a very short publi-
cation, employment or training (NEET): cation lag in order to predict the current value of
Youth not in education, employment or training the target variable. The specific target variable of
NEET share = the ILO nowcasting model is the change in hours
Youth population
worked adjusted for population aged 15–64 relative
It is worth noting that, by definition, 1 minus the to the fourth quarter of 2019 (seasonally adjusted).
NEET share gives the share of young people who For an in-depth methodological description please
consult Gomis et al. (2022). The model produces an adjusted for population aged 15–64. From the
estimate of the change in hours worked adjusted Google Community Mobility Reports, an average
for population aged 15–64 relative to this baseline. of the workplace and “retail and recreation” indices
In addition, a benchmark of weekly hours worked is used. The stringency and mobility indices are
in the fourth quarter of 2019 is used to compute combined into a single variable using principal
the full-time equivalent jobs represented by the component analysis.2 For countries without data
changes in working hours adjusted for population on restrictions, mobility data (if available) and up-
aged 15–64. This benchmark is also used to com- to-date data on the incidence of COVID-19 were
pute the time series of average hours worked used to extrapolate the impact on hours worked
adjusted for population aged 15–64. adjusted for population aged 15–64. Because of
countries’ different practices in counting cases
The ILO nowcasting model draws from multiple
of COVID-19 infection, the more homogeneous
sources: labour force survey data up to the third
concept of deceased patients is used as a proxy
quarter of 2022 and up-to-date high-frequency
for the local intensity of the pandemic. The variable
economic data such as retail sales, administra-
was averaged for each month, but the data were
tive labour market data and confidence survey
updated daily on the basis of the Our World in
data. Up-to-date mobile phone data from Google
Data online repository.3 Finally, for a small number
Community Mobility Reports and the most recent
of countries with no data readily available at the
values of the COVID-19 Government Response
time of estimation the regional average was used
Stringency Index (hereafter “Oxford Stringency
to impute the target variable. For 2022 the model
Index”) are also used in the estimates.
was modified to include GDP growth estimates and
Drawing on available real-time data, the model regional trends data and to take into account time
estimates the historical statistical relationship series properties of hours worked.
between these indicators and hours worked per
With the ILO nowcasting model estimates com-
person aged 15–64 and uses the resulting coef-
pleted, the ratio of weekly hours worked relative
ficients to predict how hours worked adjusted
to the fourth quarter of 2019 is estimated for men
for population aged 15–64 change in response
and women separately. These estimates for female
to the most recent observed values of the now-
and male changes in hours worked adjusted by the
casting indicators. Multiple candidate relationships
corresponding population aged 15–64 relative to
were evaluated on the basis of their prediction
the fourth quarter of 2019 (seasonally adjusted)
accuracy and performance around turning points
to construct a weighted average nowcast. For are produced using the ILO nowcasting-by-gender
countries for which high-frequency data on eco- model. The change in hours worked for country i,
nomic activity were available, but either data on sex s and quarter t is computed as follows:
the target variable were not available or the above Hours worked(i,s,t)
methodology did not work well, the estimated Change in hours Population aged 15–64(i,s,t)
worked relative =
coefficients and data from the panel of countries Hours worked(i,s,Q4 2019)
to Q4 2019(i,s,t)
were used to produce an estimate. Population aged 15–64(i,s,Q4 2019)
An indirect approach is applied for the remaining The data used in the model include estimates of
countries: this involves extrapolating the observed the country’s sex-aggregated ratio of weekly hours
or estimated (using the direct nowcast) change in worked (see the ILO nowcasting model above),
hours adjusted for population aged 15–64. The country demographic and economic characteris-
extrapolation is based on the observed decline tics and a regional dummy variable. The gender
in mobility, derived from the Google Community decomposition model is composed of four separate
Mobility Reports and the Oxford Stringency Index, models. First, a model produces estimates from
since countries with comparable drops in mobility the first quarter of 2020 to the fourth quarter of
and similarly stringent restrictions are likely to 2021 for countries with data on hours worked for
have experienced a similar decline in hours worked at least one quarter. Second, a model produces
2 During 2021 and 2022, a dummy variable for developed countries was also used to account for differential impacts of workplace
mobility and stringency on working hours, as well as a detrending procedure for Google Mobility Reports data.
3 https://ourworldindata.org/coronavirus.
estimates from the first quarter of 2020 to the Estimates of the distribution
fourth quarter of 2021 for countries with no
hours worked data during that period. Third, a
of employment by status,
model produces estimates for the first quarter of occupation and economic activity
2022. Finally, a model produces the projections
The distribution of employment by status, occu-
for the second and third quarters of 2022.4 These
pation and economic activity (sector) is estimated
models that make up the nowcast by gender were
for total employment and also disaggregated by
chosen from an array of models on the basis of
sex. In the first step, a cross-country regression
their accuracy in predicting changes in female
is performed to identify the share of each of the
and male hours worked. Next, the predictions
employment-related categories in countries for
from the selected models are used to estimate
which no data are available. This step uses informa-
the missing observations of hours worked.5 Given
tion on demography, per capita income, economic
that the models estimate the change in hours
structure and a model-specific indicator with high
worked for women and men separately, the ag-
predictive power for the estimated distribution.
gregated estimates for women and men may be
The indicators for each category are as follows:
incompatible with the total-population estimates
of the nowcasting model. To produce compatible X for status, the index called “work for an employer”
estimates, the subcomponents for women and from the Gallup World Poll;
men are adjusted proportionally to match the total X for occupation, the share of value added of a
loss in worked hours adjusted for population aged sector in which people with a given occupation
15–64 estimated by the nowcasting model. are most likely to work;
For analytical purposes, an estimate of the gender X for sector, the share of value added of the
gap in hours worked can be estimated using the sector.
change in weekly hours worked relative to the
fourth quarter of 2019 by sex disaggregation. The next step estimates the evolution of the shares
A change in the gender gap can be computed as of each category, using information on the eco-
the change in working hours of men minus the nomic cycle and also on economic structure and
change in working hours of women at the country demographics. The third step estimates the change
level. Finally, to obtain a weighted global aggre- in the shares of each category in the years 2020 and
gate, countries’ changes in the gender gap relative 2021. Lastly, the estimates are rebalanced to ensure
to the fourth quarter of 2019 are aggregated, the that the individual shares add up to 100 per cent.
weights being given by each country’s female total The estimated sectors are based on an ILO-specific
hours worked in the relevant quarter. Thus, the classification that ensures maximum consistency
global aggregate estimate for the gender gap can between the third and fourth revisions of the
be computed as follows: United Nations International Standard Industrial
Classification of All Economic Activities (ISIC). The
Global change in the gender gap in hours worked
relative to Q4 2019t = sectors A, B, C, F, G, I, K, O, P and Q correspond
(Male change in hours worked relative to Q4 2019(i,t) to the ISIC Rev. 4 classification. Furthermore, the
i = 189 following composite sectors are defined:
– Female change in hours worked relative to Q4 2019(i,t) )
Female hours worked(i,t) X “Utilities” is composed of sectors D and E.
i=1 × i = 189
Female hours worked(i,t)
i=1
X “Transport, storage and communication” is
composed of sectors H and J.
This weighting scheme avoids compositional
X “Real estate, business and administrative activ-
effects that arise from the size of each country’s
initial gender gap. ities” is composed of sectors L, M and N.
X “Other services” is composed of sectors R, S,
T and U.
4 The different periods were selected because of the differing availability of reported observations of hours worked.
5 The sex-disaggregated estimates of hours worked in India were obtained using urban employment levels as a proxy for hours
worked, since recent data were available from the Periodic Labour Force Survey.
The estimated occupations correspond in prin- estimates from step 1 are available. This second
ciple to the major categories of the 1988 and step relies on cross-validation and subsequent
2008 iterations of the ILO International Standard selection of the best-performing model to ensure
Classification of Occupations (ISCO-88 and ISCO- a satisfactory performance.
08). However, subsistence farming occupations
In the present edition of the model, employment
were classified inconsistently across countries, and
is subdivided into five different economic classes:
sometimes even within one country across years.
workers living on US$0–1.90 per day, US$1.90–3.20
According to ISCO-08, subsistence farmers should
per day, US$3.20–5.50 per day and above US$5.50
be classified in ISCO category 6, namely as skilled
per day, in PPP terms.
agricultural workers. However, a number of coun-
tries with a high incidence of subsistence farming
reported a low share of workers in category 6, but a Models used to project labour
high share in category 9 (elementary occupations).
This means that the shares of occupational cat- market indicators
egories 6 and 9 can differ widely between countries
The ILO has developed projection models to es-
that have a very similar economic structure. It is
timate and forecast hours worked, employment,
not feasible to determine the extent of misclassifi-
unemployment and the labour force for the years
cation between categories 6 and 9. Consequently,
2022 to 2024. In a first step, projections are made
in order to obtain a consistent and internationally
at quarterly frequency up to the fourth quarter of
comparable classification, categories 6 and 9 are
2023 for around 50 countries where labour market
merged and estimated jointly.
indicators are available at quarterly frequency
for at least part of 2022. In a second step, annual
Estimates of employment projections are made up to 2024 for all countries
by economic class – taking as given the annual averages of the projec-
tions from the first step for those countries where
The estimates of employment by economic class these are available. Projections based on the first
are produced for a subset of countries. The model step have the advantage of taking into account
uses the data derived from the unemployment, the latest labour market information and latest
status and economic activity models as inputs in high-frequency data, which greatly enhances the
addition to other demographic, social and eco- accuracy of estimates of labour market indicators
nomic variables. for the year 2022 and also improves the short-term
The methodology involves two steps. In the first forecasting performance.
step, the various economic classes of workers
are estimated using the economic classes of the Step 1. Projections at
working plus non-working population (among
other explanatory variables). This procedure is
quarterly frequency
based on the fact that the distribution of economic The quarterly projections for the unemployment
class in the overall population and the distribution rate, the EPR, the LFPR and the ratio of hours
in the working population are closely related. The worked to population aged 15–64 use high-fre-
economic class of the overall population is derived quency data such as confidence indices in addition
from the World Bank’s PovcalNet database.6 In to economic growth forecasts in order to test a
general, economic class is defined in terms of
series of models. The approach is very much in
consumption, but in particular cases for which
line with the direct nowcasting approach used to
no other data exist income data are used instead.
estimate hours worked (Gomis et al. 2022). These
Once the estimates from this first step have models are evaluated using the model search rou-
been obtained, a second step estimates data for tines described above, including splitting the data
those observations for which neither data on the into training and evaluation samples. Models are
economic class of the working population nor combined using a “jackknife model-averaging”
6 The 2020–22 poverty data are from the World Bank Poverty and Inequality Platform (PIP): https://pip.worldbank.org/home.
See Mahler (2022).
technique described by Hansen and Racine (2012), can also be computed as the sum of unemployment
which essentially finds the linear combination of plus employment. The redundancies are averaged
models that minimizes the variance of the pre- and reduce the reliance on a single specification.
diction error. The hours worked per person aged
Three different approaches are used to derive pro-
15–64 are only projected for the fourth quarter of
jections, which are then combined into a weighted
2022 (nowcasts exist until the third quarter), and
average. In all three approaches the forecast
all other indicators are projected up to the fourth
variable of interest is the annual change in the
quarter of 2023 – including the breakdowns by
above-mentioned indicators. The first approach
sex and age.
contains elements of error correction, while the
The ratios of employment and labour force to the second and third approaches don’t. The first and
population have been strongly affected by the second approach pool countries globally, while
COVID-19 crisis. The projection model is based on the third approach pools countries according
the assumption that these ratios will have a ten- to similarity.
dency to return to their long-term trend. Basically,
people will come back into the labour market and
try to find employment. In technical terms, the References
projection is based on an error correction model,
X Gomis, Roger, Paloma Carrillo, Steven Kapsos,
the correction parameter being estimated using
Stefan Kühn, and Avichal Mahajan. 2022. “The
an econometric specification that includes the
ILO Nowcasting Model: Using High-Frequency
gap between the actual historical series and the
Data to Track the Impact of the COVID-19
long-term trend.7
Pandemic on Labour Markets1”. Statistical
Journal of the IAOS 38 (3): 815–830. https://doi.
Step 2. Projections org/10.3233/SJI-220055.
at annual frequency X Hansen, Bruce, and Jeffrey Racine. 2012.
“Jackknife Model Averaging”. Journal of
The annual projection pools countries and utilizes
Econometrics 167 (1): 38–46.
vector error correction models. Five different in-
dicators are projected: the EPR, the LFPR, the un- X Mahler, Daniel Gerszon, Nishant Yonzan, Ruth
employment rate, the ratio of weekly hours worked Hill, Christoph Lakner, Haoyu Wu, and Nobuo
to population aged 15–64, and the weekly hours Yoshida. 2022. “Pandemic, Prices, and Poverty”.
worked per person employed. This estimation World Bank Blogs, 13 April 2022. https://blogs.
strategy over-identifies the target variables: hours worldbank.org/opendata/pandemic-prices-and-
worked are projected twice, and the labour force poverty.
7 The long-term trend is estimated using a Hodrick–Prescott filter with a smoothing parameter of 3,200, which is larger than the
parameter of 1,600 usually used in filtering time series at quarterly frequency and hence results in less variability in the trend.
XAppendix C. Tables of labour market indicators, world,

by country income group and by region or subregion
Table C1. World
Indicator Group Unit 2000 2010 2019 2020 2021 2022 2023 2024
Labour force Total Millions 2 751.7 3 159.0 3 465.0 3 411.5 3 499.9 3 564.7 3 601.7 3 640.5
Women Millions 1 093.5 1 251.5 1 376.0 1 346.7 1 388.0 1 416.8 1 430.6 1 444.4
Men Millions 1 658.2 1 907.6 2 089.0 2 064.8 2 111.9 2 147.8 2 171.1 2 196.1
Youth Millions 558.8 557.7 493.7 472.7 484.8 493.8 497.5 501.5
Labour force Total Per cent 64.2 62.0 60.2 58.6 59.4 59.8 59.7 59.6
participation rate
Women Per cent 50.7 49.0 47.7 46.1 47.0 47.4 47.3 47.1
Men Per cent 77.8 75.2 72.8 71.1 71.9 72.3 72.2 72.1
Youth Per cent 51.3 45.6 40.7 38.8 39.6 40.1 40.0 40.0
Employment Total Millions 2 584.6 2 958.6 3 273.1 3 176.3 3 283.5 3 359.4 3 393.4 3 429.5
Women Millions 1 025.6 1 171.6 1 298.8 1 256.4 1 301.5 1 334.9 1 347.1 1 359.7
Men Millions 1 559.0 1 787.0 1 974.3 1 919.9 1 982.0 2 024.5 2 046.3 2 069.8
Youth Millions 491.9 484.1 426.1 395.0 413.5 424.8 427.3 430.4
Employment-to- Total Per cent 60.3 58.1 56.9 54.5 55.7 56.4 56.3 56.1
population ratio
Women Per cent 47.6 45.8 45.0 43.0 44.0 44.7 44.5 44.4
Men Per cent 73.1 70.5 68.8 66.1 67.5 68.2 68.1 68.0
Youth Per cent 45.2 39.6 35.2 32.5 33.8 34.5 34.4 34.3
Unemployment Total Millions 167.1 200.4 191.9 235.2 216.4 205.2 208.2 210.9
Women Millions 67.9 79.9 77.3 90.3 86.5 81.9 83.5 84.7
Men Millions 99.2 120.6 114.7 144.9 129.9 123.3 124.7 126.3
Youth Millions 66.9 73.6 67.6 77.8 71.4 69.0 70.1 71.1
Unemployment rate Total Per cent 6.1 6.3 5.5 6.9 6.2 5.8 5.8 5.8
Women Per cent 6.2 6.4 5.6 6.7 6.2 5.8 5.8 5.9
Men Per cent 6.0 6.3 5.5 7.0 6.1 5.7 5.7 5.7
Youth Per cent 12.0 13.2 13.7 16.4 14.7 14.0 14.1 14.2
Jobs gap Total Millions 442.5 439.5 521.1 483.8 472.8
Women Millions 219.9 219.6 250.2 238.5 234.8
Men Millions 222.5 219.9 270.9 245.3 238.1
Jobs gap rate Total Per cent 13.0 11.8 14.1 12.8 12.3
Women Per cent 15.8 14.5 16.6 15.5 15.0
Men Per cent 11.1 10.0 12.4 11.0 10.5
Weekly hours worked Total Hours 43.2 42.1 40.0 41.1 41.4 41.3 41.3
per employee
Appendix C. Tables of labour market indicators, world, by country income group and by region or subregion 139
Table C1. World (cont’d)
Youth NEET Total Millions 274.4 277.0 303.1 290.7 289.3
Women Millions 189.7 185.1 193.2 191.0 191.4
Men Millions 84.7 92.0 109.9 99.7 97.9
Youth NEET rate Total Per cent 22.5 22.9 24.9 23.8 23.5
Women Per cent 31.9 31.6 32.8 32.2 32.1
Men Per cent 13.5 14.7 17.5 15.8 15.4
Informal employment Total Millions 1 783.0 1 905.0 1 844.0 1 921.6 1 961.0
Women Millions 676.6 716.5 681.5 717.9 734.6
Men Millions 1 106.4 1 188.5 1 162.5 1 203.7 1 226.4
Informality rate Total Per cent 60.3 58.2 58.1 58.5 58.4
Women Per cent 57.8 55.2 54.2 55.2 55.0
Men Per cent 61.9 60.2 60.5 60.7 60.6
Wage and salaried Total Millions 1 146.3 1 429.4 1 754.3 1 695.4 1 755.2
workers
Self-employed workers Total Millions 1 438.3 1 529.2 1 518.8 1 481.0 1 528.2
Share of wage and Total Per cent 44.4 48.3 53.6 53.4 53.5
salaried workers
Share of self-employed Total Per cent 55.6 51.7 46.4 46.6 46.5
workers
Extreme working Total Millions 666.9 405.9 218.8 228.3 220.6 214.3
poverty
(< US$1.90 PPP per day)
Share of extreme Total Per cent 25.8 13.7 6.7 7.2 6.7 6.4
working poverty
Note:“Youth” = ages 15–24. The terms “women” and “men” refer to ages 15 upwards.
Table C2. Low-income countries
Labour force Total Millions 150.5 199.1 255.1 260.1 269.5 279.3 288.5 297.9
Women Millions 66.4 86.0 110.9 112.7 117.1 120.4 124.3 128.3
Men Millions 84.1 113.0 144.2 147.3 152.4 158.9 164.1 169.6
Youth Millions 42.3 55.0 66.1 67.0 68.9 71.3 73.4 75.4
participation rate
Women Per cent 59.4 56.8 56.2 55.2 55.6 55.4 55.4 55.4
Men Per cent 78.6 77.0 74.9 74.1 74.2 75.0 75.0 75.0
Youth Per cent 54.7 51.6 48.4 47.7 47.6 47.9 47.9 47.8
Employment Total Millions 142.8 189.1 242.0 244.7 253.8 263.3 272.0 281.0
Women Millions 63.0 81.5 105.0 105.8 109.9 113.2 116.8 120.6
Men Millions 79.7 107.6 137.0 138.9 143.9 150.1 155.1 160.4
Youth Millions 38.7 50.5 60.5 60.5 62.5 64.7 66.6 68.5
population ratio
Women Per cent 56.4 53.8 53.1 51.8 52.2 52.1 52.1 52.1
Men Per cent 74.5 73.3 71.2 69.8 70.1 70.8 70.9 71.0
Youth Per cent 50.1 47.4 44.3 43.0 43.2 43.4 43.4 43.4
Women Millions 3.4 4.5 6.0 6.9 7.2 7.3 7.5 7.7
Men Millions 4.4 5.4 7.2 8.4 8.6 8.8 9.0 9.2
Youth Millions 3.6 4.4 5.6 6.5 6.4 6.6 6.8 6.9
Women Per cent 5.1 5.3 5.4 6.1 6.1 6.0 6.0 6.0
Men Per cent 5.2 4.8 5.0 5.7 5.6 5.5 5.5 5.4
Youth Per cent 8.4 8.1 8.5 9.7 9.3 9.3 9.3 9.2
Women Millions 24.9 33.2 35.9 36.8 37.6
Men Millions 19.2 26.2 28.5 28.9 29.9
Women Per cent 23.4 24.0 25.3 25.1 24.9
Men Per cent 15.1 16.0 17.0 16.7 16.6
per employee
Table C2. Low-income countries (cont’d)
Women Millions 16.6 23.7 25.2 25.7 27.1
Men Millions 8.2 12.7 14.5 13.8 14.1
Women Per cent 31.3 35.0 36.1 35.9 36.7
Men Per cent 15.2 18.5 20.5 19.0 18.8
Informal employment Total Millions 169.1 215.2 218.7 226.3 234.5
Women Millions 75.9 96.6 96.3 100.8 103.7
Men Millions 93.2 118.6 122.3 125.5 130.9
Women Per cent 93.1 92.0 91.1 91.7 91.6
Men Per cent 86.6 86.5 88.1 87.2 87.2
Wage and salaried Total Millions 22.4 34.0 48.6 49.1 51.8
workers
Self-employed workers Total Millions 120.3 155.1 193.4 195.6 202.0
salaried workers
workers
poverty
working poverty
Table C3. Lower-middle-income countries
Labour force Total Millions 929.1 1 127.7 1 274.8 1 267.9 1 296.2 1 331.4 1 355.4 1 380.8
Women Millions 298.8 366.9 411.2 405.5 416.3 431.2 439.9 448.6
Men Millions 630.3 760.8 863.6 862.4 879.8 900.2 915.5 932.2
Youth Millions 220.1 225.3 206.9 200.4 204.5 209.4 211.9 214.2
participation rate
Women Per cent 38.4 37.8 35.7 34.6 35.0 35.7 35.9 35.9
Men Per cent 79.3 77.0 74.0 72.6 72.9 73.6 73.7 73.7
Youth Per cent 45.2 40.2 34.6 33.3 33.6 34.2 34.4 34.4
Employment Total Millions 867.8 1 056.7 1 204.7 1 174.1 1 213.4 1 249.4 1 272.0 1 295.5
Women Millions 278.6 342.8 388.3 377.8 390.1 404.5 412.6 420.6
Men Millions 589.2 713.8 816.4 796.3 823.3 844.8 859.4 875.0
Youth Millions 191.6 193.8 175.0 162.3 171.2 176.1 177.9 179.5
population ratio
Women Per cent 35.8 35.3 33.7 32.3 32.8 33.5 33.6 33.7
Men Per cent 74.2 72.3 69.9 67.1 68.2 69.0 69.2 69.2
Youth Per cent 39.3 34.6 29.3 26.9 28.2 28.8 28.9 28.8
Women Millions 20.2 24.0 22.9 27.7 26.2 26.7 27.3 28.0
Men Millions 41.1 47.0 47.2 66.1 56.5 55.4 56.1 57.3
Youth Millions 28.5 31.5 31.8 38.1 33.3 33.4 33.9 34.7
Women Per cent 6.8 6.5 5.6 6.8 6.3 6.2 6.2 6.2
Men Per cent 6.5 6.2 5.5 7.7 6.4 6.2 6.1 6.1
Youth Per cent 13.0 14.0 15.4 19.0 16.3 15.9 16.0 16.2
Women Millions 77.4 76.8 87.1 83.1 84.9
Men Millions 90.5 91.7 122.0 106.2 104.5
Women Per cent 18.4 16.5 18.7 17.6 17.3
Men Per cent 11.3 10.1 13.3 11.4 11.0
per employee
Table C3. Lower-middle-income countries (cont’d)
Women Millions 114.0 115.9 119.3 119.1 119.5
Men Millions 37.1 47.7 57.6 52.4 51.5
Women Per cent 41.8 40.0 40.8 40.4 40.3
Men Per cent 12.9 15.5 18.6 16.7 16.3
Informal employment Total Millions 874.0 982.0 957.6 992.8 1 020.2
Women Millions 288.2 315.7 302.8 316.8 328.4
Men Millions 585.7 666.4 654.7 676.1 691.8
Women Per cent 84.1 81.3 80.2 81.2 81.2
Men Per cent 82.1 81.6 82.2 82.1 81.9
workers
salaried workers
workers
poverty
working poverty
Table C4. Upper-middle-income countries
Labour force Total Millions 1 134.2 1 244.8 1 303.3 1 258.2 1 305.2 1 315.2 1 315.5 1 319.6
Women Millions 496.9 540.5 573.2 550.3 573.9 579.1 578.9 580.3
Men Millions 637.3 704.3 730.1 707.9 731.3 736.1 736.6 739.4
Youth Millions 221.8 209.4 155.2 142.4 147.8 148.4 147.3 147.5
participation rate
Women Per cent 61.3 57.7 56.6 54.0 55.9 56.0 55.6 55.3
Men Per cent 80.0 76.4 73.3 70.6 72.5 72.5 72.0 71.8
Youth Per cent 59.5 52.0 46.7 43.2 45.0 45.2 44.8 44.6
Employment Total Millions 1 071.3 1 173.5 1 224.7 1 172.9 1 222.6 1 236.8 1 238.6 1 242.6
Women Millions 469.1 510.1 538.9 513.8 537.2 544.8 545.0 546.3
Men Millions 602.2 663.5 685.8 659.1 685.3 692.0 693.5 696.3
Youth Millions 197.0 183.7 132.2 118.5 123.9 125.9 125.3 125.4
population ratio
Women Per cent 57.9 54.5 53.2 50.4 52.3 52.7 52.4 52.1
Men Per cent 75.6 72.0 68.8 65.7 67.9 68.1 67.8 67.6
Youth Per cent 52.9 45.6 39.8 35.9 37.8 38.4 38.1 38.0
Women Millions 27.8 30.5 34.3 36.5 36.7 34.3 33.8 33.9
Men Millions 35.1 40.8 44.3 48.8 46.0 44.1 43.1 43.1
Youth Millions 24.7 25.6 23.0 23.9 23.8 22.4 22.1 22.0
Women Per cent 5.6 5.6 6.0 6.6 6.4 5.9 5.8 5.8
Men Per cent 5.5 5.8 6.1 6.9 6.3 6.0 5.9 5.8
Youth Per cent 11.2 12.3 14.8 16.8 16.1 15.1 15.0 14.9
Women Millions 80.1 80.5 90.5 86.6 83.4
Men Millions 72.9 74.4 85.0 78.8 76.6
Women Per cent 13.6 13.0 15.0 13.9 13.3
Men Per cent 9.9 9.8 11.4 10.3 10.0
per employee
Table C4. Upper-middle-income countries (cont’d)
Women Millions 48.4 37.5 39.6 37.8 37.0
Men Millions 29.7 24.3 28.7 25.6 25.1
Women Per cent 24.9 23.6 25.2 24.2 23.7
Men Per cent 14.3 14.0 16.6 14.9 14.6
Women Millions 273.8 263.0 243.4 259.8 261.4
Men Millions 376.3 348.2 333.4 348.5 349.2
Women Per cent 53.7 48.8 47.4 48.4 48.0
Men Per cent 56.7 50.8 50.6 50.9 50.5
workers
salaried workers
workers
poverty
working poverty
Table C5. High-income countries
Women Millions 231.4 258.0 280.7 278.2 280.7 286.1 287.5 287.3
Men Millions 306.5 329.5 351.1 347.1 348.3 352.6 354.8 354.9
Youth Millions 74.7 68.1 65.5 62.9 63.7 64.8 64.9 64.5
participation rate
Women Per cent 50.9 52.0 53.7 53.0 53.3 54.0 53.9 53.7
Men Per cent 70.5 68.7 68.5 67.5 67.6 68.0 68.0 67.8
Youth Per cent 48.9 44.5 45.2 43.7 44.5 45.1 45.1 44.9
Women Millions 214.9 237.2 266.5 259.0 264.3 272.4 272.6 272.2
Men Millions 287.9 302.1 335.2 325.6 329.5 337.5 338.3 338.2
Youth Millions 64.6 56.1 58.4 53.6 55.9 58.1 57.6 57.0
population ratio
Women Per cent 47.2 47.8 51.0 49.3 50.2 51.4 51.1 50.9
Men Per cent 66.3 63.0 65.4 63.3 63.9 65.1 64.8 64.6
Youth Per cent 42.4 36.7 40.2 37.2 39.1 40.5 40.0 39.7
Women Millions 16.6 20.8 14.1 19.2 16.5 13.7 14.9 15.1
Men Millions 18.6 27.3 15.9 21.5 18.8 15.1 16.6 16.7
Youth Millions 10.1 12.0 7.2 9.3 7.8 6.6 7.4 7.5
Women Per cent 7.2 8.1 5.0 6.9 5.9 4.8 5.2 5.3
Men Per cent 6.1 8.3 4.5 6.2 5.4 4.3 4.7 4.7
Youth Per cent 13.5 17.6 10.9 14.7 12.2 10.3 11.4 11.6
Women Millions 37.5 29.1 36.7 32.0 28.8
Men Millions 40.0 27.6 35.4 31.4 27.0
Women Per cent 13.6 9.8 12.4 10.8 9.6
Men Per cent 11.7 7.6 9.8 8.7 7.4
per employee
Table C5. High-income countries (cont’d)
Women Millions 10.7 7.9 9.1 8.3 7.7
Men Millions 9.7 7.3 9.1 7.9 7.2
Women Per cent 14.4 11.3 13.1 12.0 11.0
Men Per cent 12.3 9.7 12.3 10.8 9.7
Women Millions 38.7 41.3 38.9 40.5 41.1
Men Millions 51.2 55.3 52.0 53.7 54.6
Women Per cent 16.3 15.5 15.0 15.3 15.1
Men Per cent 17.0 16.5 16.0 16.3 16.2
workers
salaried workers
workers
Table C6. Africa
Women Millions 129.5 169.6 211.8 214.0 222.1 230.8 238.3 245.6
Men Millions 171.5 223.5 279.6 283.7 293.2 302.9 311.7 320.8
Youth Millions 78.8 95.2 106.0 107.0 110.6 115.1 118.7 122.3
participation rate
Women Per cent 54.5 54.3 53.3 52.4 52.9 53.5 53.8 53.9
Men Per cent 74.8 73.5 71.9 71.0 71.4 71.8 71.8 71.9
Youth Per cent 47.8 45.5 41.9 41.2 41.4 42.0 42.1 42.1
Women Millions 120.1 157.1 196.6 197.7 204.7 212.8 219.7 226.5
Men Millions 158.7 210.5 262.8 264.6 273.5 282.9 291.2 300.0
Youth Millions 68.7 84.3 94.8 94.7 98.2 102.2 105.4 108.6
population ratio
Women Per cent 50.5 50.3 49.5 48.4 48.8 49.4 49.6 49.7
Men Per cent 69.3 69.2 67.6 66.2 66.6 67.0 67.1 67.2
Youth Per cent 41.6 40.2 37.5 36.4 36.8 37.3 37.4 37.4
Women Millions 9.5 12.5 15.2 16.3 17.4 18.0 18.6 19.1
Men Millions 12.8 13.0 16.8 19.0 19.7 20.0 20.5 20.8
Youth Millions 10.2 10.9 11.2 12.3 12.4 12.9 13.4 13.7
Women Per cent 7.3 7.4 7.2 7.6 7.8 7.8 7.8 7.8
Men Per cent 7.5 5.8 6.0 6.7 6.7 6.6 6.6 6.5
Youth Per cent 12.9 11.5 10.6 11.5 11.2 11.2 11.2 11.2
Women Millions 52.1 66.8 70.0 72.8 75.0
Men Millions 38.7 52.1 56.2 58.0 59.1
Women Per cent 24.9 25.4 26.1 26.2 26.1
Men Per cent 15.5 16.5 17.5 17.5 17.3
per employee
Table C6. Africa (cont’d)
Women Millions 32.0 40.6 42.7 43.2 44.3
Men Millions 17.5 24.7 26.9 26.5 27.2
Women Per cent 30.7 32.3 33.1 32.6 32.6
Men Per cent 16.7 19.4 20.6 19.7 19.7
Women Millions 139.5 173.4 172.8 180.7 188.0
Men Millions 168.6 213.9 218.9 224.7 233.4
Women Per cent 88.8 88.2 87.4 88.2 88.3
Men Per cent 80.1 81.4 82.7 82.2 82.5
workers
salaried workers
workers
poverty
working poverty
Table C7. North Africa
Women Millions 11.7 16.1 16.7 16.2 16.5 17.3 17.8 18.2
Men Millions 40.0 50.8 56.3 56.2 57.9 59.3 60.4 61.6
Youth Millions 12.6 13.4 10.2 10.0 10.2 10.5 10.7 11.0
participation rate
Women Per cent 21.4 23.1 20.3 19.2 19.3 19.8 19.9 20.0
Men Per cent 73.0 72.3 67.7 66.2 67.1 67.5 67.4 67.4
Youth Per cent 34.7 32.4 24.7 23.9 24.3 24.6 24.6 24.6
Women Millions 9.3 12.9 13.3 12.8 13.1 13.8 14.1 14.5
Men Millions 34.6 47.0 51.8 50.9 52.7 54.2 55.3 56.4
Youth Millions 8.8 10.2 7.6 7.3 7.6 7.9 8.0 8.2
population ratio
Women Per cent 17.0 18.5 16.0 15.2 15.3 15.7 15.8 15.9
Men Per cent 63.2 66.9 62.3 60.0 61.0 61.6 61.7 61.7
Youth Per cent 24.3 24.6 18.3 17.5 18.0 18.3 18.3 18.4
Women Millions 2.4 3.2 3.5 3.4 3.4 3.5 3.7 3.7
Men Millions 5.4 3.8 4.5 5.3 5.2 5.1 5.2 5.2
Youth Millions 3.8 3.2 2.6 2.7 2.6 2.7 2.7 2.8
Women Per cent 20.6 20.1 20.9 21.0 20.5 20.4 20.5 20.5
Men Per cent 13.4 7.5 8.0 9.4 9.0 8.6 8.5 8.4
Youth Per cent 30.0 24.1 25.8 26.9 25.8 25.4 25.5 25.3
Women Millions 8.5 9.8 9.8 9.7 10.1
Men Millions 8.7 10.9 12.3 12.3 12.2
Women Per cent 39.7 42.5 43.3 42.6 42.3
Men Per cent 15.6 17.4 19.4 18.9 18.3
per employee
Table C7. North Africa (cont’d)
Women Millions 9.2 8.0 8.4 8.1 8.2
Men Millions 3.4 3.6 4.0 3.8 3.8
Women Per cent 45.3 39.3 41.1 39.0 39.0
Men Per cent 15.9 17.2 18.7 17.5 17.3
Women Millions 8.2 8.2 7.7 8.1 8.5
Men Millions 30.3 36.8 36.3 37.5 39.6
Women Per cent 63.9 62.1 60.4 61.4 61.4
Men Per cent 64.5 71.0 71.3 71.2 73.1
workers
salaried workers
workers
poverty
working poverty
Table C8. Sub-Saharan Africa
Women Millions 117.9 153.5 195.1 197.9 205.6 213.5 220.5 227.4
Men Millions 131.5 172.7 223.3 227.5 235.3 243.6 251.2 259.2
Youth Millions 66.2 81.8 95.8 97.0 100.3 104.6 108.0 111.3
participation rate
Women Per cent 64.3 63.3 62.0 61.1 61.6 62.2 62.3 62.4
Men Per cent 75.4 73.9 73.1 72.2 72.5 72.9 73.0 73.0
Youth Per cent 51.5 48.7 45.2 44.5 44.7 45.2 45.3 45.3
Women Millions 110.8 144.3 183.3 185.0 191.6 199.1 205.5 212.1
Men Millions 124.1 163.6 211.0 213.7 220.8 228.7 236.0 243.5
Youth Millions 59.8 74.1 87.2 87.4 90.6 94.4 97.4 100.4
population ratio
Women Per cent 60.5 59.5 58.3 57.1 57.4 57.9 58.1 58.2
Men Per cent 71.1 70.0 69.1 67.9 68.1 68.4 68.5 68.6
Youth Per cent 46.6 44.1 41.2 40.1 40.3 40.8 40.8 40.9
Women Millions 7.1 9.3 11.7 12.9 14.0 14.4 15.0 15.3
Men Millions 7.4 9.2 12.3 13.8 14.5 14.8 15.3 15.6
Youth Millions 6.4 7.7 8.6 9.6 9.7 10.2 10.6 10.9
Women Per cent 6.0 6.0 6.0 6.5 6.8 6.8 6.8 6.7
Men Per cent 5.7 5.3 5.5 6.0 6.1 6.1 6.1 6.0
Youth Per cent 9.6 9.4 9.0 9.9 9.7 9.8 9.8 9.8
Women Millions 43.6 57.0 60.2 63.1 64.9
Men Millions 30.1 41.2 44.0 45.7 47.0
Women Per cent 23.2 23.7 24.6 24.8 24.6
Men Per cent 15.5 16.3 17.1 17.2 17.0
per employee
Table C8. Sub-Saharan Africa (cont’d)
Women Millions 22.8 32.6 34.3 35.1 36.1
Men Millions 14.2 21.1 22.9 22.8 23.5
Women Per cent 27.1 31.0 31.6 31.4 31.4
Men Per cent 16.8 19.8 20.9 20.1 20.1
Women Millions 131.3 165.2 165.1 172.6 179.5
Men Millions 138.3 177.1 182.6 187.2 193.8
Women Per cent 91.0 90.1 89.2 90.1 90.2
Men Per cent 84.6 83.9 85.4 84.8 84.7
workers
salaried workers
workers
poverty
working poverty
Table C9. Latin America and the Caribbean
Women Millions 85.1 110.2 129.9 120.1 127.6 132.0 133.4 135.6
Men Millions 136.4 160.5 180.9 172.4 180.1 183.0 184.5 187.0
Youth Millions 54.2 55.3 52.7 47.4 50.3 50.7 50.1 49.9
participation rate
Women Per cent 47.2 50.6 51.9 47.4 49.8 51.0 50.9 51.1
Men Per cent 79.0 77.2 75.9 71.5 73.9 74.3 74.1 74.2
Youth Per cent 53.9 51.4 49.0 44.2 47.1 47.6 47.2 47.3
Women Millions 75.1 100.5 117.4 105.6 113.1 120.6 122.0 124.0
Men Millions 125.7 151.1 168.7 157.0 166.3 172.3 173.8 176.2
Youth Millions 44.8 47.2 43.2 37.4 40.6 42.9 42.2 42.2
population ratio
Women Per cent 41.6 46.1 46.9 41.7 44.1 46.5 46.5 46.7
Men Per cent 72.8 72.7 70.7 65.1 68.2 70.0 69.8 69.9
Youth Per cent 44.7 43.9 40.2 34.9 38.0 40.3 39.9 39.9
Women Millions 10.0 9.7 12.6 14.5 14.6 11.4 11.4 11.6
Men Millions 10.7 9.4 12.2 15.4 13.8 10.7 10.7 10.8
Youth Millions 9.3 8.1 9.5 10.1 9.7 7.8 7.8 7.8
Women Per cent 11.7 8.8 9.7 12.0 11.4 8.6 8.6 8.6
Men Per cent 7.8 5.9 6.8 8.9 7.7 5.9 5.8 5.8
Youth Per cent 17.2 14.6 17.9 21.2 19.2 15.4 15.6 15.6
Women Millions 30.7 34.7 40.1 38.7 34.4
Men Millions 18.4 23.4 29.8 25.9 22.6
Women Per cent 23.4 22.8 27.5 25.5 22.2
Men Per cent 10.9 12.2 16.0 13.5 11.6
per employee
Table C9. Latin America and the Caribbean (cont’d)
Women Millions 15.0 15.3 16.3 15.1 14.1
Men Millions 6.7 7.9 9.7 8.3 7.5
Women Per cent 28.2 28.7 30.9 28.6 26.9
Men Per cent 12.4 14.4 17.8 15.3 13.9
Women Millions 57.2 61.8 53.6 58.8 63.2
Men Millions 85.7 91.5 84.2 90.6 94.3
Women Per cent 56.9 52.6 50.7 52.0 52.4
Men Per cent 56.7 54.2 53.6 54.5 54.7
workers
salaried workers
workers
poverty
working poverty
Table C10. North America
Women Millions 74.5 82.5 88.3 87.1 87.7 89.7 90.5 90.7
Men Millions 88.1 94.7 102.5 101.2 101.9 103.2 104.1 104.5
Youth Millions 26.4 25.0 25.2 24.3 25.1 25.3 25.5 25.5
participation rate
Women Per cent 58.9 58.1 57.4 56.1 56.1 56.9 56.9 56.6
Men Per cent 73.3 69.8 68.7 67.3 67.3 67.7 67.7 67.4
Youth Per cent 60.3 51.5 52.1 50.2 51.7 51.8 51.9 51.6
Women Millions 71.3 75.5 85.0 79.7 82.9 86.3 86.3 86.4
Men Millions 84.4 84.9 98.5 93.1 96.1 99.2 99.0 99.2
Youth Millions 23.8 20.5 23.0 20.6 22.6 23.3 23.0 22.7
population ratio
Women Per cent 56.3 53.2 55.2 51.3 53.1 54.8 54.3 53.9
Men Per cent 70.2 62.6 66.0 61.9 63.5 65.1 64.4 63.9
Youth Per cent 54.5 42.3 47.6 42.4 46.5 47.6 46.6 46.1
Women Millions 3.2 7.0 3.3 7.4 4.8 3.3 4.1 4.4
Men Millions 3.7 9.8 4.1 8.1 5.8 4.0 5.0 5.3
Youth Millions 2.5 4.5 2.2 3.8 2.5 2.1 2.6 2.7
Women Per cent 4.4 8.5 3.8 8.5 5.4 3.7 4.6 4.8
Men Per cent 4.2 10.3 4.0 8.0 5.7 3.9 4.8 5.1
Youth Per cent 9.6 17.9 8.7 15.5 10.1 8.1 10.1 10.7
Women Millions 8.6 4.6 9.0 6.3 4.8
Men Millions 11.5 5.3 9.8 7.3 5.4
Women Per cent 10.3 5.1 10.1 7.0 5.3
Men Per cent 11.9 5.1 9.5 7.1 5.1
per employee
Table C10. North America (cont’d)
Women Millions 3.6 2.6 3.4 3.0 2.8
Men Millions 3.7 2.5 3.5 3.0 2.7
Women Per cent 15.4 11.0 14.4 12.5 11.6
Men Per cent 14.9 10.2 14.1 12.0 11.0
Women Millions 8.3 8.0 7.3 7.7 8.0
Men Millions 10.1 10.0 9.2 9.7 9.8
Women Per cent 10.9 9.4 9.2 9.3 9.2
Men Per cent 11.9 10.2 9.8 10.1 9.9
workers
salaried workers
workers
Table C11. Arab States (non-GCC)
Women Millions 3.2 3.7 4.5 4.5 4.6 5.0 5.3 5.5
Men Millions 14.9 19.8 25.2 25.4 26.0 27.1 28.2 29.4
Youth Millions 5.3 5.9 6.3 6.2 6.5 6.8 7.1 7.3
participation rate
Women Per cent 15.8 12.7 12.5 12.1 12.2 12.7 13.0 13.2
Men Per cent 74.2 70.0 71.1 69.3 69.0 69.7 70.2 70.6
Youth Per cent 35.6 29.9 27.6 26.2 26.9 27.3 27.6 27.8
Women Millions 2.8 3.0 3.4 3.4 3.5 3.7 3.9 4.1
Men Millions 13.5 18.0 22.2 22.1 22.7 23.8 24.8 25.9
Youth Millions 4.3 4.7 4.5 4.3 4.5 4.8 5.0 5.1
population ratio
Women Per cent 13.8 10.6 9.6 9.1 9.1 9.5 9.7 9.8
Men Per cent 67.2 63.7 62.6 60.3 60.1 61.1 61.7 62.2
Youth Per cent 29.0 23.7 19.6 18.0 18.7 19.2 19.4 19.6
Women Millions 0.4 0.6 1.1 1.1 1.2 1.3 1.3 1.4
Men Millions 1.4 1.8 3.0 3.3 3.4 3.3 3.4 3.5
Youth Millions 1.0 1.2 1.8 1.9 2.0 2.0 2.1 2.2
Women Per cent 13.0 16.7 23.7 24.9 25.3 25.3 25.6 25.8
Men Per cent 9.3 8.9 12.0 13.1 12.9 12.3 12.1 12.0
Youth Per cent 18.5 20.6 28.9 31.3 30.4 29.8 29.6 29.7
Women Millions 2.1 3.3 3.4 3.5 3.8
Men Millions 3.6 5.5 5.9 6.2 6.2
Women Per cent 40.9 49.0 49.9 50.5 50.3
Men Per cent 16.7 20.0 21.2 21.4 20.6
per employee
Table C11. Arab States (non-GCC) (cont’d)
Women Millions 5.5 6.0 6.2 6.3 6.5
Men Millions 1.9 2.7 2.9 2.8 2.8
Women Per cent 57.0 53.5 53.5 53.0 53.0
Men Per cent 18.8 22.6 24.4 22.7 22.4
Women Millions 1.7 1.8 1.7 1.8 2.0
Men Millions 11.9 15.7 15.7 16.2 17.2
Women Per cent 55.1 52.9 51.5 52.4 52.6
Men Per cent 66.0 71.0 71.4 71.3 72.2
workers
salaried workers
workers
poverty
working poverty
Table C12. Arab States (GCC)
Women Millions 1.6 3.3 5.2 5.8 5.5 5.7 5.9 6.1
Men Millions 9.8 18.2 24.7 24.1 24.0 24.3 24.7 25.1
Youth Millions 1.7 2.8 2.4 2.3 2.0 2.0 2.1 2.2
participation rate
Women Per cent 21.3 26.5 32.9 36.4 34.2 34.7 35.3 35.8
Men Per cent 77.4 81.3 85.0 83.8 84.2 84.6 84.9 85.2
Youth Per cent 27.8 30.3 28.7 28.5 27.1 27.0 27.3 27.8
Women Millions 1.5 2.9 4.6 5.0 4.7 5.0 5.1 5.3
Men Millions 9.5 17.7 24.2 23.3 23.4 23.8 24.2 24.6
Youth Millions 1.5 2.4 2.0 1.8 1.6 1.7 1.7 1.8
population ratio
Women Per cent 19.8 23.6 28.6 31.3 29.3 30.2 30.6 30.8
Men Per cent 75.0 79.2 83.5 81.0 82.2 83.0 83.4 83.6
Youth Per cent 23.7 26.1 24.4 22.7 22.1 22.5 22.8 22.9
Women Millions 0.1 0.4 0.7 0.8 0.8 0.7 0.8 0.9
Men Millions 0.3 0.5 0.4 0.8 0.6 0.5 0.4 0.5
Youth Millions 0.3 0.4 0.4 0.5 0.4 0.3 0.3 0.4
Women Per cent 6.8 11.1 13.2 14.1 14.4 13.0 13.2 14.0
Men Per cent 3.1 2.6 1.8 3.4 2.5 1.9 1.8 1.9
Youth Per cent 14.7 13.8 14.9 20.6 18.5 16.6 16.7 17.6
Women Millions 0.8 1.4 1.8 1.4 1.4
Men Millions 1.0 1.3 1.7 1.5 1.2
Women Per cent 22.2 23.8 26.9 23.4 22.5
Men Per cent 5.6 5.0 6.9 6.0 5.0
per employee
Table C12. Arab States (GCC) (cont’d)
Women Millions 1.2 1.0 1.1 0.9 0.9
Men Millions 0.8 0.5 0.7 0.4 0.4
Women Per cent 32.6 27.5 29.9 27.2 26.7
Men Per cent 14.5 10.2 16.3 10.9 10.2
Women Millions 1.1 1.6 1.7 1.6 1.7
Men Millions 7.3 10.2 9.6 9.8 10.2
Women Per cent 35.8 35.6 33.7 34.3 34.8
Men Per cent 41.1 42.1 41.2 41.8 42.9
workers
salaried workers
workers
Table C13. East Asia
Women Millions 381.7 398.2 411.5 399.5 414.5 415.5 413.6 412.9
Men Millions 469.3 504.1 502.6 489.7 504.1 505.4 503.8 503.6
Youth Millions 152.3 139.5 93.2 86.7 88.6 88.5 87.7 87.6
participation rate
Women Per cent 67.2 61.7 60.4 58.4 60.3 60.2 59.7 59.3
Men Per cent 81.7 77.2 73.0 70.9 72.7 72.5 72.0 71.6
Youth Per cent 64.6 55.4 49.2 46.4 47.8 47.9 47.4 47.1
Women Millions 370.3 382.6 396.0 382.8 398.6 398.7 397.7 397.3
Men Millions 451.7 479.0 478.7 464.1 479.9 479.7 479.4 479.5
Youth Millions 141.6 125.8 83.7 76.4 78.2 77.6 77.3 77.4
population ratio
Women Per cent 65.2 59.2 58.1 56.0 58.0 57.8 57.4 57.0
Men Per cent 78.7 73.3 69.6 67.2 69.2 68.9 68.5 68.2
Youth Per cent 60.1 50.0 44.2 40.8 42.2 42.0 41.8 41.6
Women Millions 11.4 15.7 15.6 16.6 15.9 16.8 16.0 15.7
Men Millions 17.6 25.1 23.9 25.6 24.2 25.7 24.5 24.1
Youth Millions 10.7 13.6 9.5 10.4 10.4 10.9 10.4 10.2
Women Per cent 3.0 3.9 3.8 4.2 3.8 4.0 3.9 3.8
Men Per cent 3.8 5.0 4.8 5.2 4.8 5.1 4.9 4.8
Youth Per cent 7.0 9.8 10.2 12.0 11.7 12.3 11.8 11.7
Women Millions 40.1 35.9 39.5 37.1 38.1
Men Millions 44.3 39.4 42.4 40.8 42.3
Women Per cent 9.5 8.3 9.4 8.5 8.7
Men Per cent 8.5 7.6 8.4 7.8 8.1
per employee
Table C13. East Asia (cont’d)
Women Millions 24.2 15.4 16.5 16.0 15.9
Men Millions 17.7 11.9 14.2 12.8 12.9
Women Per cent 20.2 17.4 18.9 18.5 18.5
Men Per cent 13.4 11.7 14.2 12.9 13.1
Women Millions 205.7 191.8 180.6 191.5 188.9
Men Millions 271.8 237.9 230.7 238.9 235.4
Women Per cent 53.8 48.4 47.2 48.0 47.4
Men Per cent 56.8 49.7 49.7 49.8 49.1
workers
salaried workers
workers
poverty
working poverty
Table C14. South-East Asia
Women Millions 103.2 121.8 139.3 137.5 138.8 141.9 143.9 145.9
Men Millions 143.4 172.2 194.1 192.8 193.2 196.7 199.5 202.2
Youth Millions 54.9 53.1 49.6 47.2 45.6 46.0 46.4 46.9
participation rate
Women Per cent 56.6 55.6 55.7 54.3 54.2 54.8 54.9 54.9
Men Per cent 80.7 79.9 78.9 77.3 76.6 77.2 77.3 77.4
Youth Per cent 53.9 49.4 46.0 43.8 42.3 42.6 42.9 43.2
Women Millions 99.1 117.7 136.1 133.5 135.2 138.5 140.6 142.4
Men Millions 137.9 166.8 189.3 186.8 187.4 191.4 194.4 196.8
Youth Millions 48.9 47.9 45.2 42.4 41.1 41.7 42.3 42.5
population ratio
Women Per cent 54.4 53.7 54.4 52.7 52.8 53.5 53.6 53.6
Men Per cent 77.6 77.4 76.9 75.0 74.3 75.1 75.3 75.3
Youth Per cent 47.9 44.5 42.0 39.4 38.2 38.7 39.1 39.2
Women Millions 4.1 4.1 3.2 3.9 3.7 3.4 3.3 3.5
Men Millions 5.5 5.4 4.8 5.9 5.8 5.4 5.1 5.4
Youth Millions 6.1 5.2 4.4 4.8 4.4 4.3 4.1 4.4
Women Per cent 4.0 3.4 2.3 2.9 2.6 2.4 2.3 2.4
Men Per cent 3.8 3.2 2.5 3.1 3.0 2.7 2.6 2.7
Youth Per cent 11.1 9.8 8.8 10.1 9.8 9.3 8.9 9.4
Women Millions 15.2 12.1 13.1 14.5 14.3
Men Millions 11.0 10.1 13.2 13.3 12.7
Women Per cent 11.4 8.2 8.9 9.7 9.4
Men Per cent 6.2 5.1 6.6 6.6 6.2
per employee
Table C14. South-East Asia (cont’d)
Women Millions 14.0 11.6 12.3 11.5 11.4
Men Millions 7.9 7.2 8.6 8.5 8.2
Women Per cent 26.5 22.1 23.4 22.0 21.8
Men Per cent 14.5 13.0 15.6 15.4 14.9
Women Millions 92.9 96.1 93.2 95.1 96.1
Men Millions 132.0 133.7 133.3 132.8 133.6
Women Per cent 79.0 70.6 69.8 70.4 69.4
Men Per cent 79.1 70.6 71.3 70.9 69.8
workers
salaried workers
workers
poverty
working poverty
Table C15. South Asia
Women Millions 127.9 158.3 169.8 165.5 171.4 178.5 182.2 184.9
Men Millions 395.3 474.0 529.3 528.8 540.9 555.1 564.3 573.5
Youth Millions 125.3 126.6 111.8 107.6 111.7 114.3 114.7 114.6
participation rate
Women Per cent 28.0 27.4 24.7 23.7 24.1 24.8 24.9 24.9
Men Per cent 81.9 78.6 74.3 73.0 73.6 74.5 74.6 74.6
Youth Per cent 43.4 37.4 31.0 29.7 30.7 31.3 31.3 31.2
Women Millions 118.3 145.9 158.3 150.7 158.0 165.0 168.3 170.7
Men Millions 368.7 440.1 496.2 479.2 500.8 515.8 524.2 532.6
Youth Millions 109.7 106.9 90.2 80.8 89.2 91.8 91.7 91.4
population ratio
Women Per cent 25.9 25.3 23.1 21.6 22.3 22.9 23.0 23.0
Men Per cent 76.4 73.0 69.7 66.2 68.1 69.2 69.3 69.3
Youth Per cent 38.0 31.6 25.0 22.3 24.5 25.1 25.0 24.9
Women Millions 9.6 12.5 11.5 14.8 13.3 13.5 13.9 14.2
Men Millions 26.7 33.9 33.1 49.6 40.1 39.3 40.1 40.9
Youth Millions 15.6 19.7 21.6 26.8 22.5 22.6 23.0 23.2
Women Per cent 7.5 7.9 6.8 8.9 7.8 7.5 7.6 7.7
Men Per cent 6.7 7.1 6.3 9.4 7.4 7.1 7.1 7.1
Youth Per cent 12.5 15.6 19.3 24.9 20.2 19.7 20.0 20.3
Women Millions 32.6 29.4 37.7 31.0 31.5
Men Millions 57.4 53.8 78.9 62.1 60.9
Women Per cent 18.3 15.7 20.0 16.4 16.0
Men Per cent 11.5 9.8 14.1 11.0 10.6
per employee
Table C15. South Asia (cont’d)
Women Millions 81.5 83.5 85.3 86.0 86.8
Men Millions 19.0 27.3 35.3 29.9 29.1
Women Per cent 49.9 48.2 49.0 49.1 49.5
Men Per cent 10.8 14.6 18.8 15.8 15.3
Women Millions 130.9 140.1 131.0 139.2 145.1
Men Millions 374.8 428.6 416.1 434.7 445.6
Women Per cent 89.7 88.5 86.9 88.1 87.9
Men Per cent 85.2 86.4 86.8 86.8 86.4
workers
salaried workers
workers
poverty
working poverty
Table C16. The Pacific
Women Millions 6.6 7.9 9.7 9.7 10.0 10.2 10.3 10.4
Men Millions 8.3 9.5 11.0 11.0 11.3 11.5 11.5 11.6
Youth Millions 3.0 3.3 3.5 3.4 3.5 3.6 3.6 3.6
participation rate
Women Per cent 57.0 57.0 58.5 57.8 58.6 59.2 58.5 58.2
Men Per cent 72.8 68.6 67.3 66.5 66.8 66.9 66.4 66.1
Youth Per cent 64.7 57.2 56.1 54.8 56.0 57.2 56.3 55.8
Women Millions 6.2 7.5 9.2 9.2 9.5 9.9 9.9 10.0
Men Millions 7.8 9.0 10.5 10.4 10.7 11.0 11.1 11.2
Youth Millions 2.7 2.9 3.2 3.0 3.2 3.3 3.3 3.3
population ratio
Women Per cent 53.9 54.1 55.9 54.7 56.0 57.2 56.6 56.3
Men Per cent 68.4 65.3 64.1 62.7 63.6 64.4 64.0 63.8
Youth Per cent 57.7 51.0 50.3 48.1 50.4 52.6 51.8 51.5
Women Millions 0.4 0.4 0.4 0.5 0.4 0.3 0.3 0.3
Men Millions 0.5 0.5 0.5 0.6 0.5 0.4 0.4 0.4
Youth Millions 0.3 0.4 0.4 0.4 0.4 0.3 0.3 0.3
Women Per cent 5.5 5.1 4.5 5.5 4.4 3.4 3.3 3.3
Men Per cent 6.0 4.9 4.7 5.7 4.8 3.7 3.6 3.5
Youth Per cent 10.9 10.9 10.4 12.2 10.1 8.1 7.9 7.8
Women Millions 1.3 1.5 1.6 1.5 1.4
Men Millions 1.2 1.3 1.4 1.3 1.2
Women Per cent 14.8 13.8 15.1 13.8 12.4
Men Per cent 11.6 10.8 11.8 10.9 9.8
per employee
Table C16. The Pacific (cont’d)
Women Millions 0.6 0.6 0.6 0.6 0.6
Men Millions 0.5 0.5 0.6 0.5 0.5
Women Per cent 20.7 19.2 20.4 19.5 19.0
Men Per cent 17.1 16.4 18.1 16.7 16.0
Women Millions 2.9 3.4 3.4 3.5 3.6
Men Millions 3.2 3.7 3.6 3.8 3.8
Women Per cent 38.3 37.3 36.8 37.1 36.0
Men Per cent 35.8 35.5 35.0 35.3 34.9
workers
salaried workers
workers
poverty
working poverty
Table C17. Northern, Southern and Western Europe
Women Millions 86.0 97.5 103.9 102.8 104.1 105.6 105.5 105.3
Men Millions 111.7 116.9 119.6 118.0 118.5 120.0 120.1 120.0
Youth Millions 25.3 23.7 21.7 20.9 21.3 21.8 21.6 21.4
participation rate
Women Per cent 47.4 50.9 52.9 52.2 52.7 53.4 53.2 53.0
Men Per cent 66.2 65.1 64.3 63.3 63.4 64.0 64.0 63.7
Youth Per cent 47.5 45.6 43.9 42.4 43.1 44.2 43.9 43.7
Women Millions 77.2 87.9 96.5 95.1 96.2 98.6 98.2 98.1
Men Millions 103.1 105.4 111.6 109.6 110.2 112.7 112.5 112.5
Youth Millions 21.0 18.7 18.5 17.4 17.8 18.8 18.4 18.3
population ratio
Women Per cent 42.5 45.9 49.1 48.2 48.7 49.9 49.6 49.4
Men Per cent 61.1 58.7 60.0 58.8 59.0 60.2 59.9 59.7
Youth Per cent 39.5 36.1 37.4 35.3 36.1 38.1 37.5 37.3
Women Millions 8.8 9.6 7.5 7.7 7.9 7.0 7.3 7.2
Men Millions 8.6 11.5 8.0 8.5 8.4 7.2 7.6 7.5
Youth Millions 4.3 5.0 3.2 3.5 3.5 3.0 3.2 3.1
Women Per cent 10.2 9.8 7.2 7.5 7.6 6.6 6.9 6.9
Men Per cent 7.7 9.9 6.7 7.2 7.1 6.0 6.3 6.3
Youth Per cent 16.9 20.9 14.8 16.6 16.3 13.8 14.6 14.6
Women Millions 19.0 16.4 18.4 17.0 15.6
Men Millions 17.8 14.4 16.4 15.1 13.6
Women Per cent 17.8 14.5 16.2 15.0 13.7
Men Per cent 14.4 11.4 13.0 12.0 10.7
per employee
Table C17. Northern, Southern and Western Europe (cont’d)
Women Millions 3.4 2.5 2.7 2.6 2.3
Men Millions 3.4 2.8 3.1 2.9 2.5
Women Per cent 13.5 10.6 11.3 10.8 9.7
Men Per cent 12.9 10.9 12.3 11.3 9.9
Women Millions 12.1 13.7 12.9 13.6 13.7
Men Millions 12.1 14.0 13.0 13.5 13.7
Women Per cent 13.8 14.2 13.6 14.1 13.9
Men Per cent 11.5 12.5 11.9 12.2 12.2
workers
salaried workers
workers
Table C18. Eastern Europe
Women Millions 71.1 70.9 68.7 68.0 68.1 67.6 67.0 66.4
Men Millions 76.7 77.1 76.7 75.9 75.6 74.9 74.4 73.9
Youth Millions 19.6 15.6 9.6 9.0 8.8 8.8 9.0 9.2
participation rate
Women Per cent 53.2 52.6 52.2 51.8 52.1 52.0 51.7 51.3
Men Per cent 66.5 66.7 67.8 67.3 67.4 67.1 67.0 66.5
Youth Per cent 40.7 37.5 33.4 31.6 30.7 30.4 30.9 30.8
Women Millions 63.1 65.6 65.5 64.3 64.5 64.2 63.6 62.9
Men Millions 67.9 70.5 73.0 71.7 71.7 71.2 70.7 70.2
Youth Millions 15.1 12.7 8.3 7.6 7.4 7.5 7.7 7.8
population ratio
Women Per cent 47.2 48.7 49.8 48.9 49.3 49.3 49.1 48.6
Men Per cent 58.9 61.0 64.5 63.5 63.9 63.8 63.7 63.2
Youth Per cent 31.5 30.5 28.8 26.6 25.9 26.1 26.4 26.1
Women Millions 8.0 5.3 3.2 3.7 3.6 3.4 3.4 3.4
Men Millions 8.7 6.6 3.7 4.3 3.9 3.7 3.7 3.7
Youth Millions 4.4 2.9 1.3 1.4 1.4 1.2 1.3 1.4
Women Per cent 11.2 7.4 4.6 5.5 5.3 5.1 5.1 5.2
Men Per cent 11.4 8.5 4.8 5.6 5.2 4.9 5.0 5.1
Youth Per cent 22.7 18.6 13.8 15.8 15.7 14.2 14.6 15.1
Women Millions 11.1 7.4 8.2 7.8 7.6
Men Millions 10.9 6.9 7.6 6.9 6.7
Women Per cent 14.4 10.2 11.3 10.7 10.6
Men Per cent 13.4 8.6 9.6 8.8 8.6
per employee
Table C18. Eastern Europe (cont’d)
Women Millions 3.5 2.0 2.0 2.1 2.0
Men Millions 2.5 1.4 1.6 1.6 1.5
Women Per cent 17.3 13.9 14.5 15.0 14.3
Men Per cent 11.8 9.6 10.8 10.7 10.5
Women Millions 12.2 12.2 11.7 11.9 11.8
Men Millions 14.7 15.2 14.7 14.9 14.6
Women Per cent 18.5 18.7 18.2 18.5 18.4
Men Per cent 20.9 20.9 20.6 20.8 20.5
workers
salaried workers
workers
Table C19. Central and Western Asia
Women Millions 23.1 27.4 33.3 32.2 33.5 34.4 34.8 35.1
Men Millions 32.7 37.1 42.7 41.8 43.0 43.8 44.2 44.6
Youth Millions 12.1 11.9 11.5 10.6 10.9 11.0 11.0 11.1
participation rate
Women Per cent 46.6 45.7 48.5 46.5 47.7 48.5 48.5 48.4
Men Per cent 69.1 64.5 64.7 62.8 63.8 64.3 64.1 63.9
Youth Per cent 44.3 38.6 40.2 37.4 38.7 39.3 39.2 39.0
Women Millions 20.6 25.2 30.2 29.4 30.5 31.6 31.9 32.2
Men Millions 30.0 33.9 38.7 38.0 39.4 40.6 41.0 41.3
Youth Millions 9.9 10.1 9.4 8.7 9.0 9.3 9.3 9.4
population ratio
Women Per cent 41.4 42.0 44.0 42.3 43.4 44.5 44.4 44.3
Men Per cent 63.4 59.0 58.7 57.0 58.4 59.6 59.4 59.2
Youth Per cent 36.4 32.7 32.9 30.6 32.1 33.3 33.2 33.0
Women Millions 2.6 2.2 3.1 2.9 3.0 2.9 2.9 2.9
Men Millions 2.7 3.2 4.0 3.8 3.6 3.2 3.2 3.3
Youth Millions 2.2 1.8 2.1 1.9 1.9 1.7 1.7 1.7
Women Per cent 11.2 8.1 9.2 8.9 9.0 8.3 8.3 8.4
Men Per cent 8.3 8.6 9.3 9.1 8.4 7.3 7.3 7.3
Youth Per cent 17.9 15.3 18.3 18.2 17.2 15.3 15.3 15.4
Women Millions 6.3 6.1 7.4 7.0 6.8
Men Millions 6.6 6.4 7.6 6.8 6.2
Women Per cent 20.0 16.9 20.1 18.7 17.7
Men Per cent 16.3 14.2 16.6 14.7 13.2
per employee
Table C19. Central and Western Asia (cont’d)
Women Millions 5.1 3.9 4.1 3.8 3.8
Men Millions 3.0 2.6 2.8 2.5 2.4
Women Per cent 33.4 28.3 29.5 27.7 27.5
Men Per cent 19.5 17.8 19.4 17.4 16.8
Women Millions 12.2 12.5 11.6 12.4 12.7
Men Millions 14.2 14.1 13.4 14.1 14.7
Women Per cent 48.4 41.4 39.3 40.7 40.1
Men Per cent 41.8 36.4 35.2 35.9 36.2
workers
salaried workers
workers
poverty
working poverty
X Appendix D. Estimates of jobs in global supply chains
This appendix describes the data and methodology

used to produce estimates of the number of jobs in
Methodology
global supply chains (GSCs) that are linked to high- The methodology applied to estimate the number
income countries, as well as the jobs’ composition of jobs in GSCs consists of three main steps.
in terms of sex, age, status, formality, skill level
and pay. First, one calculates the gross output in each country
and sector which is required to produce one unit of
final goods demanded in any country and sector.
Data The Leontief inverse matrix allows one to determine
these technical coefficients and is computed on
Estimates of the number of jobs in GSCs are the basis of the international input–output tables
constructed on the basis of a combination of from the ADB’s MRIO Database following standard
two data sources. The first data source consists input–output modelling procedures.
of the international input–output tables that are
available for 62 countries worldwide for 2000 and Second, a demand vector needs to be defined
2007–21 from the MRIO Database of the Asian that captures output produced for GSCs. The
Development Bank (ADB). These tables cover methodology defines GSCs as including any type
35 economic activities (henceforth called “sec- of supply relationship that crosses borders, thereby
tors”, shown in table D1) and provide information including exports of intermediates to be used in
on country-sector level linkages in production. the production of final goods or services in other
They are combined with a novel balanced panel countries, and also exports of final goods or ser-
database of ILO estimates of employment by devices. Consequently, the demand vector for each
tailed sector for 1991–2021, which was developed country for which the number of GSC jobs is to
specifically for this project. be determined is uniquely specified by country.
For example, for GSC jobs in manufacturing in
Besides the estimate of total employment in
Thailand, the approach would consider jobs re-
a sector, the ILO’s database also includes for
lated to the production of manufactured goods
each sector an estimate of employment by sex
in Thailand, which are either directly consumed
(male and female), by age group (youth and
or further processed and then consumed by con-
adult), by employment status (employees and
sumers outside Thailand. To quantify “re-imports”,
self-employed), by informality, by occupational
meaning exported intermediates required to
skill level (high skilled and low/medium skilled)
satisfy domestic demand, domestic demand is
and by hourly pay of employees (low pay when
specified as a demand vector, but only the jobs
earning less than two thirds of the median hourly
related to the production of intermediates used
pay). The ILO’s harmonized microdata repository,
in foreign countries are considered.
which is the world’s largest repository of national
labour force survey data sets, is the primary Third, gross output required from each sector
source of these labour market indicators. Some within a country to satisfy GSC demand is trans-
additional data were taken from other national lated into a corresponding number of jobs. By di-
sources. These data are cleaned, and adjusted viding employment in a sector by its gross output,
for breaks in the data series as well as for the lack the employment input per unit of gross output can
of reliability in cases of data points based on less be computed. In line with estimation approaches
than 30 observations in the labour force survey. used by other international organizations, the as-
All the missing data points are estimated using sumption is made that labour productivity does not
information such as GDP, sectoral value added differ between GSC-related and non-GSC-related
and employment data from other data sources economic activity within a sector. The agricultural
such as the United Nations Industrial Development sector in low- and middle-income countries often
Organization (UNIDO) or the OECD. The estimation comprises a large segment characterized by rela-
approach follows the ILO’s standard methods to tively low labour productivity levels, serving mainly
estimate labour market data (see Appendix B). local markets, and a small but highly productive
Appendix D. Estimates of jobs in global supply chains 177
segment that is integrated into GSCs, serving in total GSC employment. In Chapter 1, this figure
international markets. As this report focuses on is compared with the economy-wide incidence of
GSC jobs in industry and market services, the employment characteristics, where the weights
productivity differences in agriculture do not affect are simply the share of that sector in employment
results shown in this report. across all sectors considered.
The incidence of employment characteristics When the data sources described above are
(status, formality, skill, pay, sex, age) in GSC sec- combined in this way, the methodology produces
tors is estimated as a weighted average of the estimates of GSC jobs for 35 sectors in 62 countries
incidence of such employment. The incidence in for 2000 and 2007–21 (see table D1 and D2 for lists
each sector is weighted by the share of that sector of sectors and countries, respectively).
X Table D1. Sectors included
Section/ Industry name Section/ Industry name

division division
code code
A–B Agriculture, hunting, 51 Wholesale trade and commission

forestry and fishing trade, except of motor vehicles
and motorcycles
C Mining and quarrying
52 Retail trade, except of motor vehicles
15–16 Food, beverages and tobacco
and motorcycles; repair of household
17–18 Textiles and textile products goods
19 Leather, leather and footwear H Hotels and restaurants
20 Wood and products of wood 60 Inland transport

and cork 61 Water transport
21–22 Pulp, paper, printing and publishing 62 Air transport
23 Coke, refined petroleum 63 Other supporting and auxiliary
and nuclear fuel transport activities; activities of travel
24 Chemicals and chemical products agencies
25 Rubber and plastics 64 Post and telecommunications
26 Other non-metallic minerals J Financial intermediation
27–28 Basic metals and fabricated metal 70 Real estate activities
29 Machinery, n.e.c. 71–74 Renting of machinery and equipment

and other business activities
30–33 Electrical and optical equipment
L Public administration and defense;
34–35 Transport equipment compulsory social security
36–37 Manufacturing, n.e.c.; recycling M Education
E Electricity, gas and water supply N Health and social work
F Construction O Other community, social and personal

services
50 Sale, maintenance and repair
of motor vehicles and motorcycles; P Private households with employed
retail sale of fuel persons
Notes:Based on ISIC Rev. 3.1.

Source:ADB MRIO.
X Table D2. Economies included
ISO code Country name ISO code Country name
AUS Australia LAO Lao People’s Democratic Republic
AUT Austria LVA Latvia
BGD Bangladesh LTU Lithuania
BEL Belgium LUX Luxembourg
BTN Bhutan MYS Malaysia
BRA Brazil MDV Maldives
BRN Brunei Darussalam MLT Malta
BGR Bulgaria MEX Mexico
KHM Cambodia MNG Mongolia
CAN Canada NPL Nepal
CHN China NLD Netherlands
HRV Croatia NOR Norway
CYP Cyprus PAK Pakistan
CZE Czechia PHL Philippines
DNK Denmark POL Poland
EST Estonia PRT Portugal
FJI Fiji ROU Romania
FIN Finland RUS Russian Federation
FRA France SGP Singapore
DEU Germany SVK Slovakia
GRC Greece SVN Slovenia
HKG Hong Kong, China ESP Spain
HUN Hungary LKA Sri Lanka
IND India SWE Sweden
IDN Indonesia CHE Switzerland
IRL Ireland TWN Taiwan, China
ITA Italy THA Thailand
JPN Japan TUR Türkiye
KAZ Kazakhstan GBR United Kingdom
KOR Republic of Korea USA United States
KGZ Kyrgyzstan VNM Viet Nam
Source:ADB MRIO.
Appendix E. Productivity measurement and data 179
X Appendix E. Productivity measurement and data
Measuring productivity cannot be distinguished from one another. In

addition, the accurate measurement of TFP is a
Productivity measurement, including the precise difficult task, since it is generally calculated as a
indicators to be used, is an issue of utmost rele- residual obtained after the contributions to output
vance to the analysis in Chapter 3. Most production from labour and capital are computed in standard
processes involve multiple outputs and virtually production functions. This in turn implies that TFP
all involve multiple inputs, and thus in Chapter 3 may reflect factors other than pure productivity
the choice of the productivity measure matters gains. These factors chiefly include market failures
(Diewert and Nakamura 2005). such as imperfect competition, rents associated
with market power, and the role of other inputs
Some of the measures proposed in the litera-
(for example, intangible and/or natural capital) not
ture include:
incorporated in standard production functions.
X single-factor productivity (SFP) defined as the In the standard approaches to estimating it, TFP
ratio of a measure of output quantity to the can also capture the utilization intensity of inputs
quantity of a single input; such as capital and labour; for example, one might
X labour productivity (LP) defined as the ratio of wrongly attribute an increase in the capital stock
a measure of output quantity to some measure already installed in an economy to an increase in
of the quantity of labour used, such as total efficiency. Furthermore, there is a significant lack of
workers or total hours worked; comprehensive TFP panel data at the global level.
X multifactor productivity (MFP) defined as the Labour productivity is not entirely exempt from
ratio of a measure of output quantity to a its own measurement problems. These problems
measure of the quantity of a bundle of inputs also relate to the measurement of output and
often intended to approximate total input; labour input, the more contested issues being
X total-factor productivity (TFP) defined as the the correct pricing of output and the degree of
ratio of a measure of total output quantity to a harmonization of labour inputs. Nevertheless,
measure of the quantity of total input. labour productivity is regarded as the main de-
terminant of living standards, income and material
Labour productivity is one of the most widely used
well-being. Moreover, the empirical evidence shows
indicators. Its level and evolution over time depend
that labour productivity is also the most important
on the availability of other inputs – such as different
economic factor in setting wages at a level that
forms of capital – and the technology used to com-
allows enterprises to retain workers and create
bine them to produce output. Labour productivity
jobs while paying decent wages (ILO 2020). From
can be directly measured using widely available
a technical point of view, labour productivity does
national account and labour market variables.
not rely on strong assumptions about the specific
TFP, by contrast, is a theoretical construct that is
production function governing how output is
assumed to reflect efficiency gains, whence the
generated, such as are needed to estimate TFP.
income gains accruing to all factors of production
are derived. The importance of TFP is reflected in In productivity studies, labour input is most appro-
its being the most commonly employed proxy to priately measured as the total number of hours
gauge the degree of technological progress as actually worked, that is, effectively used in pro-
well as other important drivers of productivity like duction, and whether paid or not.1 Although data
institutional quality. As such, it is considered to be a on hours worked are available, they span relatively
key driver of labour productivity growth, together short periods of time and hence are unsuitable to
with capital deepening. One of its main drawbacks, illustrate the secular stagnation in productivity
however, is that it reflects several factors that growth. Figure E1 shows the breakdown of growth
1 For a thorough discussion see https://www.oecd-ilibrary.org/sites/pdtvy-2017-5-en/index.html?itemId=/content/component/

pdtvy-2017-5-en.
per hour was, however, much larger for upper-

X Figure E1. Breakdown of growth in GDP middle-income countries, and the intensity of work
per worker into growth in GDP per hour measured in hours worked per worker remained
and hours worked per worker unchanged between the two seven-year periods
(percentages)
in the case of high-income countries.
World
Since the analysis adopts mostly a long-term
perspective, necessitating as long a time series
2005–12 2.6
as possible, Chapter 3 uses data on productivity
2012–19 2.3 per worker as opposed to productivity per hour
worked, acknowledging the caveats and limitations
Low-income countries
associated with this choice.2
2005–12 0.8
2012–19
Data sources used
2005–12
Chapter 3 combines data from different sources.
3.9
The data used for the analyses at the country
2012–19 3.7
and regional levels are sourced from either
ILOSTAT, The Conference Board or the Penn
World Table 10.0, whereas all the analyses at the
2005–12 6.1
sectoral level are carried out using the Economic
2012–19 3.9 Transformation Database (ETD) as well as the
OECD’s Structural Analysis (STAN) Database.3 The
three sources of data provide roughly the same
2005–12 1.1
values for the variables used throughout Chapter 3
2012–19 1.0 at the aggregate level, confirming consistency at
this level of analysis.4
Growth of GDP per hour Growth of hours
worked per worker ILOSTAT data have the advantage of covering a
larger number of countries (189), thereby providing
wider coverage of both regional and income group-
ings. The Conference Board data cover 133 countries
in GDP per worker into growth in GDP per hour and across the globe and are preferred when it comes to
hours worked per worker. The former reflects the demonstrating the productivity growth slowdowns
expansion of productivity that can be attributed to afflicting the world economy, since the series starts
greater efficiency in production per hour worked, in the 1950s. It also includes (estimated) data up
while the latter reflects the expansion that can be to 2022. As with the other data sets, productivity
attributed to the change in the number of hours data are comparable across countries. The main
worked per worker. advantage of the Penn World Table 10.0 is that it
features national account data, which are needed
Figure E1 reveals that, for the world as a whole,
for physical capital investment. It comprises data
both hours worked and GDP per hour contributed
for 183 countries.
to the slowdown of growth of GDP per worker
observed between the – relatively short – periods For the more fine-grained examinations at the
of 2005–12 and 2012–19. The role played by GDP one-digit industry level featuring in Appendix F, the
2 The most relevant of which is that changes in labour productivity measured using employment levels may reflect changes in
employment intensity rather than changes in value added produced per hour.
3 https://ilostat.ilo.org/; https://www.conference-board.org/data; https://www.rug.nl/ggdc/productivity/pwt/?lang=en; https://
www.rug.nl/ggdc/structuralchange/etd/?lang=en; https://www.oecd.org/sti/ind/stanstructuralanalysisdatabase.htm. For
extensive information on this data set see https://www.rug.nl/ggdc/structuralchange/etd/?lang=en.
4 The main variables we use are GDP in constant national currency as well as in international dollars, value added in constant
national currency, and employment in thousands of people.
Appendix E. Productivity measurement and data 181
ETD data set is used, since it was built to ensure sector level, EU KLEMS data do not offer any
comparability across time and across the countries further advantage than the OECD’s STAN data
included. The ETD contains nominal and real value set, inasmuch as the indicators in both cases
added and corresponding employment data at are sourced from the same harmonized system
the industry level for 51 countries in Africa, Asia of national accounts.10 Thus, when it comes to
and Latin America. The data set features 12 in- these basic sector-level indicators, no further
dustries and annual data from 1990 to 2018. To data-processing is undertaken by either the
gain a broader country coverage, these data are OECD or the group of researchers who maintain
combined with the STAN database, which contains the EU KLEMS database.11 The use of the ETD and
the same variables for 38 countries, most of them STAN databases ensures that growth rates are
high-income economies.5 comparable at the sectoral level when calculated
The choice of these databases is grounded on their using data on value added defined in constant units
comprehensiveness in terms of capturing value of national currencies. To undertake the aggregate
added and employment data at the one-digit sector productivity growth decomposition analysis in
level, as well as on their well-known advantages Appendix F, we use industry-level employment
in international comparability.6 Whereas the ETD shares as weights.
captures a blend of mostly low- and middle-income Finally, it is worth noting that, since our main focus
economies, the STAN database provides infor- is on comparing labour productivity growth per-
mation for all OECD Members, which represent formance across countries over time, we rely on
upper-middle-income and high-income countries.7 data in real terms to compute real labour product-
Both sources of data have been widely used in ivity growth rates. At the sectoral level we only
cross-country analyses of labour productivity per- conduct growth comparisons, utilizing data on
formance, in terms of both growth rates and levels.8
real value added and employment, the former
The EU KLEMS data set is a well-known resource expressed in constant national currency terms. At
for comparative investigations of productivity the economy-wide level, we also make comparisons
performance in high-income countries.9 Since of labour productivity levels, for which we employ
the analysis in this report only exploits data on real value added data adjusted for PPP differences
value added and employment at the one-digit across countries.12
5 For extensive information on this data set see https://www.oecd.org/sti/ind/stanstructuralanalysisdatabase.htm.

6 See Herrendorf, Rogerson and Valentinyi (2022) and De Vries et al. (2021) for a discussion of the merits of the ETD for comparative
international analyses on productivity matters.
7 Although only 12 per cent of the observations in our final sample belong to low-income countries, the ETD remains, to our
knowledge, the only reliable database for cross-country labour productivity comparisons involving these economies. See
Herrendorf, Rogerson and Valentinyi (2022) for a discussion.
8 Recent examples of empirical studies utilizing the ETD include Herrendorf, Rogerson and Valentinyi (2022) and Xinshen, McMillan
and Rodrik (2019). For a recent example of analysis based on the STAN database, see European Commission (2020).
9 For more information on this database see https://euklems-intanprod-llee.luiss.it/.
10 The original national account data are published by each country’s respective national statistical office.
11 The major advantage of the EU KLEMS data lies in its modelling of the sources of productivity growth at the sector level. By
employing a growth-accounting methodology, it estimates the contribution of a diverse set of drivers of productivity growth,
such as physical capital, skills and intangible assets, in delivering labour and TFP growth. For the latest information on this
database, see https://euklems-intanprod-llee.luiss.it/.
12 The use of PPPs is advised against when comparing labour productivity at the industry level across countries. See, among
others, OECD (2021), for an explicit example.
References
X De Vries, K., A. Erumban, and B. Van Ark. 2021. X ILO. 2020. “Driving up Productivity: A Guide
“Productivity and the Pandemic: Short‑Term for Employer and Business Membership
Disruptions and Long‑Term Implications. The Organizations”. https://www.ilo.org/actemp/
Impact of the COVID-19 Pandemic on Productivity publications/WCMS_758749/lang--en/index.htm.
Dynamics by Industry”. International Economics
X OECD (Organisation for Economic Co-
and Economic Policy 18: 541–570.
operation and Development). 2021. “OECD
X Diewert, W.E., and A.O. Nakamura. 2005. Productivity Statistics Database. Methodological
“Concepts and Measures of Productivity: An Notes”. https://www.oecd.org/sdd/
Introduction”. In Services Industries and the productivity-stats/OECD-Productivity-Statistics-
Knowledge Based Economy, edited by Richard Methodological-note.pdf.
Lipsey and Alice Nakamura, 19–37. Calgary:
X Xinshen, Dao, Margaret McMillan and Dani
University of Calgary Press.
Rodrik. 2019. “The Recent Growth Boom in
X European Commission. 2020. “Productivity in Developing Economies: A Structural-Change
Europe: Trends and Drivers in a Service-Based Perspective”. In The Palgrave Handbook of
Economy”, JRC Technical Report, JRC119785. Development Economics, edited by Machiko
Nissanke and José Antonio Ocampo, 281–334.
X Herrendorf, Berthold, Richard Rogerson
Cham: Palgrave Macmillan.
and Ákos Valentinyi. 2022. “New Evidence on
Sectoral Labor Productivity: Implications for
Industrialization and Development”, National
Bureau of Economic Research Working Paper.
https://doi.org/10.3386/w29834.
Appendix F. Productivity growth and structural change 183
XAppendix F. Productivity growth

and structural change
This appendix contains a simple analysis of labour labour productivity growth rates in the agricultural
productivity growth in the main economic sec- and manufacturing sectors. Importantly for
tors as well as the implications of shifts in the development purposes, the pace of productivity
sectoral composition of economies (structural gains in the primary sector in the lowest income
change) for long-term aggregate labour product- group is rather similar to that in the highest
ivity growth. income group, implying that convergence in that
sector is far from having materialized.1
The patterns of labour productivity growth
observed in the period 1992–2018 across the three Next, we turn to investigating the role played by the
main sectors are rather similar across the four different drivers of labour productivity growth. This
different country income groups (figure F1). The analysis is based on the methodology originally
well-established fact that the services sector is developed by Foster, Haltiwanger and Krizan
more sluggish in general than the primary and (2001). These authors proposed an industry-wide
secondary sectors, regardless of countries’ income decomposition of labour productivity growth when
level, is also confirmed. Interestingly, though, firm-level data sets are used. Their methodology
services seem to demonstrate better productivity is applied to the industry-level data to obtain
growth in the lower-middle-income group, while the analogous results applicable to aggregate labour
upper-middle-income countries have seen higher productivity performance.
X Figure F1. Average labour productivity growth in the main economic sectors,
1992–2018 (percentages)
0
Agriculture Manufacturing Market services
Low-income countries Lower-middle-income countries

Upper-middle-income countries High-income countries
Note:Growth rates for each group are obtained by computing the weighted average labour productivity growth
rate of the countries in that group, the weights being given by each country’s share of the total real GDP (PPP
in constant international 2017 dollars) of the country income group. Labour productivity at the sectoral level is
constructed using gross value added at constant 2015 prices (millions of local currency) and the total number of
people engaged. Market services include trade and transport, information and communication, professional,
scientific and technical activities, and administrative and support service activities.
Source:Authors’ calculations based on data from STAN, ETD and ILOSTAT.
1 For a deep investigation into the role played by agriculture in convergence across economies, see Dieppe and Matsuoka (2021).
This methodology consists of breaking economy-

wide labour productivity growth down into three X Figure F2. Decomposition of labour
main components: the within, the between and productivity growth, selected
the dynamic or cross-term effects. The first of economies (percentages)
these captures the effect of productivity growth
within the different industries while holding China
sectoral employment shares constant. It is usually India
interpreted as capturing the intrinsic contribution
Estonia
of each industry to overall productivity growth,
Ethiopia
which can include factors such as technological
progress and other types of efficiency gains at the Mozambique
sectoral level. The second component provides Ghana

a measure of the part of aggregate labour Hong Kong, China
productivity growth that owes to the shift of Tunisia
labour towards sectors with lower or higher labour
Nigeria
productivity levels (the term “between” alludes
Hungary
to that flow of labour that takes place between
industries). Finally, the dynamic effect measures South Africa
the interaction of changes in industry-level labour United States

productivity and employment across sectors over Germany
time. Therefore, it measures the extent to which Canada
positive/negative efficiency gains interact with
Japan
the expansion/contraction of different industries.2
United Kingdom
Figure F2 shows various breakdowns of labour
productivity growth, for selected countries, into Brazil
these three different components. Mexico
Figure F2 shows that the within component, cap- Within Between Dynamic
turing the part of labour productivity growth that
owes to intrinsic labour productivity growth at the
Note:Contributions are expressed in percentage
sectoral level, has been the largest contributor points of the actual average annual labour
to average labour productivity growth across productivity growth rate. For more details on the
the countries shown.3 Exceptions include Brazil, methodology behind this decomposition, see
Foster, Haltiwanger and Krizan (2001). Labour
Mexico and Nigeria, where the main driver of productivity at the sectoral level is constructed
labour productivity growth has been the between using gross value added at constant 2015 prices
component, which reflects shifts of labour across (millions of local currency) and the total number
of people engaged.
industries. In these three countries, the decompo-
sition shows that these shifts have been in favour Source:STAN and ETD.
of industries with higher productivity levels per

worker. It is also worth noting that in several
countries – including Nigeria, Mexico and South In countries at the bottom of the distribution
Africa – the contribution of the dynamic component of income per worker, it is worth emphazising,
was negative, meaning that employment did not d ynamic labour reallocations across sectors
flow to the sectors with the highest average labour have been detrimental to overall labour product-
productivity growth profiles. ivity growth, whereas the within and between
2 For a very clear explanation of this methodology, including the mathematical details behind it, see https://www.oecd-ilibrary.
org/sites/pdtvy-2018-4-en/index.html?itemId=/content/component/pdtvy-2018-4-en#:~:text=The%20shift%2Dshare%20ana-
lysis%20is,by%20resource%20reallocation%20among%20sectors.
3 This is consistent with recent evidence indicating that, between 1995 and 2018, within-sector increases in labour productivity
can explain at least two thirds of average economy-wide labour productivity growth in every region of the world (Nayyar,
Hallward-Driemeier and Davies 2021).
Appendix F. Productivity growth and structural change 185
X Figure F3. Real value added and employment shares across sectors (percentages)
Agriculture
1990 2005 2018
China – employment 60.1 44.8 26.1
China – value added 34.3 14.9 7.7
Lesotho – employment 36.5 41.8 35.3
Lesotho – value added 16.0 6.6 5.3
United States – employment 1.9 1.4 1.3
United States – value added 1.1 1.2 1.1
Manufacturing
1990 2005 2018
Market Services
1990 2005 2018
Note:Value added shares are expressed in real terms. Shares may not add up to 100, since these sectors
only represent a (large) proportion of the whole economy. The composition of market services is defined at
https://ilostat.ilo.org/resources/concepts-and-definitions/description-labour-force-statistics/.
Source:ETD and STAN.
components have had the largest positive contri- the different sectoral structures of economies
butions. This is exemplified by all the sub-Saharan with different levels of development. Lesotho, the
African economies shown. Moreover, the flow of least developed country represented in the whole
labour resources to sectors with higher product- data set, exhibits an economic structure marked
ivity levels has been a marked characteristic of the by the agricultural sector’s strong presence,
labour productivity growth experience of Ethiopia, especially in terms of employment. The sectoral
one of the least developed countries in the sample. composition of the United States has changed
The same applies to upper-middle-income econ- only very slightly, the progressive drop in the
omies such as Hong Kong (China) and Mexico. employment share of the manufacturing sector
Figure F3 shows the evolution of real value added being an implicit sign of the relatively strong
and employment shares for three major sectors: performance of labour productivity in that sector.
agriculture, manufacturing and market services. Meanwhile, China’s economic transformation has
The graph reproduces well-known facts about been characterized by the well-known process of
expanding export-based manufacturing to the References

detriment of employment in the primary sector.
X Baumol, William J. 1967. “Macroeconomics
The three sectors’ shares of real employment
of Unbalanced Growth: The Anatomy of Urban
have changed comparatively little in Lesotho
Crisis”. American Economic Review 57 (3): 415–426.
over the last two decades. This partly reflects
a lack of rapid structural transformation, which X Dieppe, Alistair, and Hideaki Matsuoka. 2021.
has been both a cause and a consequence of the “Sectoral Decomposition of Convergence in
lack of overall economic growth. Value added Labor Productivity: A Re-examination from
shares, by contrast, have declined significantly a New Dataset”, World Bank Policy Research
in the agricultural sector and increased in the Working Paper No. 9767. https://openknowledge.
market services sector. This observation points worldbank.org/handle/10986/36232.
to the possibility that Baumol’s cost disease is at
X Foster, L., J. Haltiwanger and C.J. Krizan. 2001.
play in this country (Baumol 1967). In addition,
“Aggregate Productivity Growth. Lessons from
the stagnation of manufacturing employment at
Microeconomic Evidence”. In New Developments
a relatively low share is consistent with findings
in Productivity Analysis, edited by Charles R.
that recent trends in structural transformation
Hulten, Edwin R. Dean and Michael J. Harper,
in lower-middle-income countries have not been
303–372. Chicago, IL: University of Chicago Press.
following the same path of industrialization that
most of today’s high-income countries did when X Nayyar, Gaurav, Mary Hallward-Driemeier, and
they developed to achieve their high-income status Elwyn Davies. 2021. At Your Service? The Promise of
(Nayyar, Hallward-Driemeier and Davies 2021). Services-Led Development. World Bank.
Advancing social justice,
promoting decent work
The International Labour World Employment and Social Outlook: Trends 2023
Organization is the United
A multitude of crises are stalling the recovery from the COVID-19
Nations agency for the world
pandemic, which is uneven and still incomplete in many parts of the
of work. We bring together
world. Policymakers face difficult trade-offs (such as that between
governments, employers and
inflation and continued labour market slack). The cost-of-living crisis
workers to drive a human-centred
threatens household livelihoods. Employment growth in 2023 is
approach to the future of work
projected to falter while global unemployment is expected to rise.
through employment creation,
Major decent work deficits, which to a large degree predate the
rights at work, social protection
pandemic, are set to persist under these conditions.
and social dialogue.
This year’s World Employment and Social Outlook: Trends provides
a comprehensive assessment of existing decent work deficits
and discusses how they were affected by the COVID-19 crisis. It
analyses global patterns, regional differences and outcomes across
groups of workers. The report also offers labour market projections
for 2023 and 2024. Moreover, it presents trends in labour productivity
growth and analyses the factors underlying its decline.
ilo.org
International Labour Organization

Route des Morillons 4
1211 Geneva 22
Switzerland

World Employment and Social Outlook Trends 2023 - ILO

Uploaded by

Copyright:

Available Formats

World Employment and Social Outlook Trends 2023 - ILO

Uploaded by

Document Information

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

World Employment and Social Outlook Trends 2023 - ILO

Uploaded by

Copyright:

Available Formats

ILO Flagship Report

International Labour Office • Geneva

ISBN 9789220372913 (print); ISBN 9789220372920 (web PDF)

Produced by the Publications Production Unit (PRODOC) of the ILO.

This year’s World Employment and Social Outlook: Trends provides

1. Stalled labour market recovery undermines social justice 19

A challenging macroeconomic environment for labour markets 23

Labour supply, employment and shortage of jobs 28

Workers are likely to face deteriorating working conditions 41

Risks to the outlook 47

Renewing the social contract and advancing social justice 49

2. Employment and social trends by region 57

Asia and the Pacific 72

Europe and Central Asia 77

3. Global productivity trends:

Productivity trends across the globe and structural shifts 90

Technology and labour market linkages 100

What else explains the productivity slowdown? 107

Policy options 109

B. ILO modelled estimates 130

C. Tables of labour market indicators, world, by country income group

D. Estimates of jobs in global supply chains 176

E. Productivity measurement and data 179

F. Productivity growth and structural change 183

Labour markets face

Challenging labour market conditions undermine social justice

Multiple crises are impeding employment growth

Employment growth is likely to slow significantly

Job quality is under pressure as well

Productivity growth remains vitally important

Downside risks are therefore significant in 2023

Global policy space is fragmented

A worsening global economic outlook threatens to exacerbate

X A challenging macroeconomic environment

The cost-of-living crisis is 2021, activity resumed quickly, thanks to pent-up

X Figure 1.2. Food and energy prices indices

Policy uncertainty Business confidence Consumer confidence

2010–19 2020 2021 2022 2023

World 2.1 –4.1 5.0 2.2 1.7

Low-income countries –0.7 –3.2 1.7 1.0 2.4

Lower-middle-income countries 3.5 –4.5 4.4 3.6 3.7

High-income countries 1.4 –4.8 5.0 2.3 0.8

Long-term trends affecting biodiversity or melting of permafrost could ac-

X Labour supply, employment and shortage of jobs

World Low-income countries Lower-middle-income countries

World 47.4 72.3

Source:ILOSTAT, ILO modelled estimates, November 2022.

Women Total Men

Source:ILOSTAT, ILO modelled estimates, November 2022.

workers are informal and/or self-employed. In consumption, thereby supporting employment

X Figure 1.9. Average annual employment growth, 2010–24,

2010–19 2020–21 2022 2023 2024

World 1.1 0.2 2.3 1.0 1.1

Low-income countries 2.8 2.4 3.7 3.3 3.3

Lower-middle-income countries 1.6 0.4 3.0 1.8 1.8

Upper-middle-income countries 0.5 0.0 1.2 0.1 0.3

High-income countries 1.1 –0.6 2.7 0.2 –0.1

Source:Author’s calculations based on ILOSTAT, ILO modelled estimates, November 2022.

20 Quarterly employment data are available for 37 high-income countries.

X Figure 1.10. Revision to employment growth projection in 2023, world,

1. Stalled labour market recovery undermines social justice 19

A challenging macroeconomic environment for labour markets 23

Labour supply, employment and shortage of jobs 28

Workers are likely to face deteriorating working conditions 41

Risks to the outlook 47

Renewing the social contract and advancing social justice 49

2. Employment and social trends by region 57

Asia and the Pacific 72

Europe and Central Asia 77

Productivity trends across the globe and structural shifts 90

Technology and labour market linkages 100

What else explains the productivity slowdown? 107

Policy options 109

B. ILO modelled estimates 130

D. Estimates of jobs in global supply chains 176

E. Productivity measurement and data 179

F. Productivity growth and structural change 183