Unemployment near 8% across G20

By Reuters
Posted Nov. 8, 2010 at 11:41 a.m.

Unemployment in the Group of 20 leading world economies is close to 8 percent of the total workforce and looks set to keep growing strongly, the International Labour Organisation (ILO) said on Monday.

In a report for the group’s summit this week in Seoul, the United Nations agency said some 70 million people were out of work in G20 countries by mid-2010, over half of them in the richer members.

New jobs had been created across the G20 this year, most rapidly in the poorer nations, but the rate they were appearing was lagging far behind what was needed to make up for those lost in the financial crisis.

To tackle the problem, ILO economists said, Group leaders should focus on shaping “productive employment and job-intensive growth policies” at their conference in the South Korean capital on Thursday and Friday.

The meeting has been called to review the state of the global economy and how banking and market rules can be tightened to prevent any repetition of the crisis, as well as to consider how stable recovery can be achieved.

But the ILO message was not encouraging.

“The G20 countries will need to create some 21 million jobs each year over the next decade — approximately half of the 44 million required globally — just to keep up with the increase in the working age population,” the report said.

And demotivation was emerging as a problem among the work force in richer countries, still holding jobs but with little or no wage growth, and with many facing declining hours of work as governments and firms move to cut costs.

Unemployment stood at 32.5 million in mid-year in the G20 emerging economies — like Argentina, Brazil, Indonesia, Mexico, Russia, South Africa and Turkey — but in most of them it was on the decline, the ILO said.

In European members — Britain, France, Germany, Italy, Netherlands and Spain — it totalled 15.5 million people, and in non-European high-income countries — Australia, Canada, Japan, South Korea and the United States — it was 22 million.

What was needed, the U.N. agency argued, were “higher investments and access to credit, greater attention to small enterprises and gradual expansion of social protection in all (G20) countries.”

The leaders should also set in motion policies that would bring real wages rising in line with productivity increases, and better protect low-wage earners through minimum-wage arrangements, according to the report.

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