World of Work Report ILO

In News

• Recently, the ninth edition (World of Work) of the International Labour Organisation (ILO) Monitor has been released.

Major highlights of the report 

• Increasing inequalities: Multiple global crises are threatening global labour market recovery, with increasing inequalities within and between countries.
• Reduction in working hours and Job loss: After significant gains made during 2021, the number of hours worked globally dropped in 2022, to 3.8% below the pre-crisis benchmark.
  • This means that about 11.2 crore jobs might have been lost between this period.
  • For every 100 women at work prior to the pandemic, 12.3 women would have lost their job as an average through the entire period considered by the report.
  • For every 100 men, the equivalent figure would have been 7.5.
• Multiple economic crises including inflation, especially in energy and food prices, financial turbulence, potential debt distress, and global supply chain disruption, exacerbated by war in Ukraine may further deteriorate the number of hours worked in 2022.
• Containment measures implemented in China: The report said that the recent containment measures implemented in China account for 86% of the global decline in hours worked in the first quarter of 2022.
• The great divergence between richer and poorer countries evident during the recovery period is reflected in the gender gap in hours worked.
• Gender gap: The report found that the gender gap in low- and middle- income countries remains larger than the pre-pandemic level despite some progress.
  • Both India and lower-middle-income countries, excluding India, experienced a deterioration of the gender gap in hours in the second quarter of 2020.
• Women in India: Because the initial level of hours worked by women in India was very low, the reduction in hours worked by women in India has only a weak influence on the aggregate for lower-middle-income countries.
  • In contrast, the reduction in hours worked by men in India has a large impact on the aggregates.
• In high-income countries: both men and women have experienced a strong recovery in hours worked.

Challenges faced by the Indian Economy and Job Loss

• The pandemic seems to have exacerbated the already substantial gender imbalances in employment participation in the country.
• India slipped 28 places to rank 140th among 156 countries in the World Economic Forum’s (WEF) Global Gender Gap Report 2021, becoming the third-worst performer in South Asia.
• Trade unions have urged the Union government to address the issue of unemployment.
• Most people are on contract without any social security in India: If there are no decent wages, purchasing power will also come down.
• The Code on Wages was passed in 2019 but is not yet implemented.
• The Wage Committee in 1948 asked the government to implement minimum wage, living wage and decent wage.
  • We have not implemented even minimum wage yet under pressure from industrialists.
• ILO’s projections have underestimated the real picture in India: According to Trade union’s calculation, 30%-60% of workers who lost jobs during the lockdown have not joined any work.
• One-third of MSMEs (micro, small and medium enterprises) can never be revived, according to a survey by the associations of MSMEs.
• High prices: Hawkers and vendors are facing problems due to high prices of fruits and vegetables.
• Impact on organised sector’s jobs: Urban employment is a proxy for better paying jobs and a decline in these numbers reflects impact on better-paying organised sector’s jobs.
• Low consumption levels: With Covid-19 cases on the rise amid the threat posed by the Omicron variant and many states imposing fresh curbs, economic activity and consumption levels have been affected.
• $5-trillion target: None of this portends well for the economy or the $5-trillion target set by the government, unless it can course-correct and creates more jobs.
• Job security: Indians, however, worry about unemployment with concerns around job security topping their list.
• Ripple effect: The impact of unemployment can be felt by both the workers and the national economy and can cause a ripple effect.

Way forward/ Suggestions

• The report also found that at the current rate of progress, it would take 30 years to close the gap in hours worked in high-income countries.
• Purchasing capacity of the workers should be improved. ILO has been proposing decent jobs and decent wages.
• The Centre had accepted that 50% of the women workforce returned back to cities after the first lockdown.
  • Overall women participation has also gone down.
• Demographic dividend: There was a time when India’s demographic dividend was being touted as its biggest strength.
• Positive feedback: Around 70% urban Indians also believe the country is moving in the right direction.
• A Change in the pattern of investment: The planning process in the initial stages gave importance to an investment-allocation pattern with a high capital-labour ratio. Therefore, a shift in the emphasis to mass consumer goods industries would generate more employment to absorb the unemployed labour force.
• Encouragement to small enterprises as against big enterprises: The employment objective and the output objective can be achieved, if greater investment is directed to small enterprises rather than to large enterprises.
• Underemployment in Rural Areas: It is necessary to organise the Rural works Programme. Failure of implementation of the Rural Works Programme underlines the relatively low importance given to the rural sector to provide additional employment to millions of landless labourers and small and marginal farmers.

Source: TH