ILO: Recession, massive job loss threaten global economy

MANILA, Philippines - Recession and massive job loss are threatening to sweep across the globe and spark social unrest, the International Labor Organization (ILO) said in a report released yesterday.

In its “grim analysis” of world employment, the ILO said governments should immediately address unemployment and resist pressures to cut spending on social programs.

“We have reached the moment of truth,” said Raymond Torres, director of the ILO’s International Institute for Labor Studies. “We have a brief window of opportunity to avoid a major double-dip in employment.”

The ILO noted that while private enterprises are in an even weaker position to retain employees amid crisis, austerity measures implemented by governments have contributed to the growing numbers of unemployed.

The report said 80 million more jobs are needed over the next two years for global employment to return to pre-crisis levels. But at current rate, it would take at least five years for employment in developed countries to return to pre-crisis levels – one year longer than projected in last year’s report.

This year’s ILO report for the first time features a “social unrest” index highlighting global levels of discontent over perceived economic inequality. The report noted growing popular anger in advanced economies such as those in the European Union.

The report also warned of a “significant aggravation of social unrest” in over 45 of the 118 countries surveyed.

“As the recovery derails, social discontent is now becoming more widespread,” the report read. Public dissatisfaction is high in the Middle East and in North Africa and is relatively lower in Asia, the report pointed out.

The report also noted a glimmer of hope, citing an increase in active labor market spending by half a percent of gross domestic product. Such development is expected to increase employment in a country by 0.4 percent to 0.8 percent.

The study’s release came ahead of a G-20 summit later this week. UN Secretary-General Ban Ki-moon is expected to attend the summit where social and economic issues related to the global slowdown are up for discussion.