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August 1 2006 - A report from the International Labour Organization (ILO) says today's labour market is characterized by a widening gap between unprecedented opportunity for some and growing uncertainty for many.

The report, entitled Changing patterns in the world of work describes recent trends and future prospects in an emerging global labour market. The report says: "Change provides welcome opportunities for more rewarding and satisfying work and a better life. For others, change is worrisome, closing off rather than opening up chances for improving living and working conditions."

According to ILO director-general Juan Somavia:

"There is a growing feeling that the dignity of work has been devalued; that it is seen by prevailing economic thinking as simply a factor of production - a commodity - forgetting the individual, family, community and national significance of human work. People are reacting in conversations at home, in the secrecy of the voting booth and, when necessary, by forcefully voicing their complaints in the streets."

The report's key findings include:

• The global workforce is growing rapidly. Over 3 billion are either working or looking for work. This is expected to increase by over 430 million by 2015, almost all coming from developing countries.
• "Hundreds of millions of new jobs will be needed over the next decade." Economies will have to create an average of more than 43 million new jobs annually to reduce global unemployment, which increased to 192 million in 2005, up from 157 million in 1995.
• "The impact of HIV/AIDS will be increasingly decisive in many countries." The epidemic, which has the greatest impact on people of working age, is expected to cause an estimated total loss of some US$270 billion by 2020 in 41 countries hardest hit by the disease.
• Women constitute 40 per cent of the labour force. From 1991 to 2005 the global female workforce increased from under 1 billion to 1.22 billion, "but women still face many obstacles to equal integration in the labour market".
• During the last decade, global youth employment rates increased from 12.1 to 13.7 per cent. In 2005, young people in developing regions were 3.3 times more likely, and in the developed world 2.3 times more likely to be unemployed compared to adult workers.
• In 2004, there were 218 million children trapped in child labour, representing a decrease of 11 per cent over the last four years.
• The number of people aged 60 years and over is growing faster than all other age groups. Labour force participation rates for women and men above 50 years of age have increased worldwide.
• The services sector increased from 34.4 per cent in 1995 to nearly 39 per cent of global employment in 2005. The agricultural sector represents 40 per cent and the industrial sector 21 per cent.

Juan Somavia says:

"A major effort is needed to improve productivity, earnings and working conditions in order to reduce working poverty that affects nearly half of all the workers in the world. We live in a time of opportunity and uncertainty in which some of the barriers that have prevented women and men from fully realizing their capabilities are coming down, but in which good jobs that provide the foundation of security to build better lives are increasingly difficult to find."

The report identifies four major forces interacting to drive change in global workplaces and labour markets:

1. the development imperative, stemming from urgent need to reduce poverty and inequality;
2. a technological transformation resulting from developments in information processing and communications;
3. an intensification of competition following trade and financial liberalization and a dramatic reduction in transport and communication costs;
4. a shift in political thinking regarding labour markets.

"If we want to achieve the goal of decent work for all, it is vital to understand what is driving the process of change so that it can be shaped to yield more and better jobs for working women and men everywhere," the report says.

Trends in the global labour market identified by the report include:

• changes in the world labour force
• shifts in employment due to evolution of global production systems
• skills shortages emerging worldwide
• increasing international labour migration
• growth of the informal economy
• discrimination in employment and occupation
• growing pressures for flexibility and security in labour markets.

The report stresses that there is a major transformation in the world of work with the potential for creating opportunities for all working men and women to have a decent job.

The report says:

"Technological progress, if applied in ways that promote inclusion rather than exclusion, could increase productivity and make material poverty history within a generation."

"The main means for ensuring an inclusive character to the growth of the global economy is the way in which work and labour markets are organized and governed. Recent history is however disturbing, the employment intensity of growth has slipped back globally."

It adds that there are three components of a strategy to reduce the world's 'decent work deficits':

1 a more employment-intensive form of growth especially in countries with large-scale underemployment and working poverty;

2 an increase in productivity of poorest workers to enable improvement in earnings and working conditions; and

3 a faster rate of overall growth increasing demand for labour and the movement of poorest workers into more productive jobs.

The report cautions that the ratio of dependents to those of working age is beginning to rise in some developed countries and will start to increase rapidly in a number of developing countries including China over the next 25 years.

"The economic reality is that the current working population essentially pays from their earnings for retirees' pensions and health care, whether through taxes on wages and a state transfer mechanism or through the dividends paid on investments in the companies for which they work."

The report identifies common patterns in current developments in labour market governance. It suggests that the enormous variety of work demands diverse governance mechanisms. Formulation of laws, regulations and contracts should be based on broadly accepted principles. Some countries focus on evaluating existing systems built up over many years. Most face the challenge of extending labour legislation to cover the informal economy. The report suggests that the ILO's International Labour Standards have an important continuing influence on legislation worldwide.

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