Job growth in South Asia may halve this year: ILO

The growth of jobs in South Asia is expected to nearly halve to 1.6 per cent in 2023 from 3 per cent a year ago, according to a new International Labour Organization (ILO) report released yesterday. 

This will be due to slowing economic growth impacted by the war in Ukraine, high inflation and worsened public finances, it said.

The report "World Employment and Social Outlook: Trends 2023" also projects that global employment growth would be only 1 per cent in 2023, less than half the level in 2022.

This would mark a reversal of the decline in global unemployment seen between 2020-2022.

This will be due to slowing economic growth impacted by the war in Ukraine, high inflation and worsened public finances

It means that global unemployment will remain at 16 million above the pre-crisis benchmark set in 2019, said the report.

The report said South Asia, comprising countries including Bangladesh, India, Sri Lanka and Pakistan, was likely to register a total of 54.1 million of unemployed people in the current year, up 2.46 per cent from the previous year.

"Several countries, such as Bangladesh, rely heavily on exports to Europe; weaker demand for these goods is reducing growth prospects in the subregion," it said.

"Inequality both between and within countries is growing and the recovery from the pandemic has been deeply uneven," said the report.

The scarcity of new jobs will hit countries at a time when many are still recovering from the economic shock of the global pandemic and the coronavirus is tearing through China after Beijing lifted tight lockdown restrictions, said Reuters.

"…we don't expect the losses incurred during the Covid-19 crisis to be recovered before 2025," said Richard Samans, director of the ILO's research department and coordinator of the report.

"The slowdown in productivity growth is also a significant concern, as productivity is essential for addressing the interlinked crises we face in purchasing power, ecological sustainability and human well-being," he said.

The ILO said the South Asia region was expected to register 692 million of employment in 2023, up from 681 million the previous year.

The report referred to International Monetary Fund and World Bank projections regarding economic growth.

It said the South Asia region witnessed the strongest growth and some of the highest regional figures in the world and the economy of the region was projected to grow 5.3 per cent in 2023.

"Originally high growth projections for India have been revised downwards and may be so revised further, given deteriorating global conditions and faster than anticipated monetary tightening," said the report.

"Household consumption will be held back by slow recovery of the labour market and by high inflation," it said.

The report said South Asia has few direct links with Russian and Ukraine but was very vulnerable to the higher global commodity prices that have resulted from the conflict.

The ILO said recent high and volatile energy prices have shown how vulnerable the region was with respect to energy imports; there is a clear need to become less dependent on these imports.

"The region remains highly vulnerable to natural disasters, for example on the flood plains of Pakistan and Bangladesh," it said.

The ILO said the current global economic slowdown was likely to force more workers to accept lower quality, poorly paid jobs which lack job security and social protection, so accentuating inequalities exacerbated by the Covid-19 crisis.