1、,Born into Crisis,Rooted in the Real Economy,Responding Today,Responding Today,Rooted in the Real Economy,Born into Crisis,The International Labour Organization 1919-2009,Specialized agency of the UN 182 member States 40 field offices throughout the world,Devoted to advancing opportunities for women
2、 and men to obtain decent and productive work in conditions of freedom, equity, security and human dignityPlacing employment at the heart of development policy,The International Labour Organization,The ILO: Born into Crisis,Founded in 1919 as part of Treaty of Versailles that ended First World War A
3、 response to the extraordinary economic development of the Industrial Revolution, which was accompanied by intolerable human suffering and social unrest Workers demanding democratic rights and decent working conditions Visionary industrialists saw social progress as critical to survival of private i
4、ndustry,The ILO: Reaching deep into the Real Economy,The only tripartite organization in the UN family. Employers and workers representatives have an equal voice with that of governments Operates with practical, concrete and specific contributions from its tripartite constituents Promote labour stan
5、dards Create greater opportunities for decent employment Enhance coverage and effectiveness of social protection,Strengthen tripartism and social dialogue to advance these goals.,The ILO: Experience Responding to Crisis,In its first year, the ILO adopted 6 conventions, including those covering Hours
6、 of Work Unemployment Insurance Maternity Protection Minimum Age,The ILO: Experience Responding to Crisis,In the 1930s, in the wake of global financial collapse, the ILO worked to coordinate a global approach toward raising labour standards and rebuilding employment.,The ILO: Experience Responding t
7、o Crisis,At the end of Second World War, the ILO adopted the Declaration of Philadelphia as nations looked to a future of peace and security Labour is not a commodity,Freedom of expression and association are essential to sustained progress Poverty anywhere constitutes a danger to prosperity everywh
8、ere,All human beings have the right to pursue their material well being in conditions of freedom and dignity, economic security and equal opportunity,The ILO: Experience Responding to Crisis,1950s 1970s Creation and expansion of technical cooperation to help newly de-colonized nations build sustaina
9、ble economies 1980s 1990s Response to end of Cold War, helping newly democratic countries restore functioning labour markets Response to Asian financial crisis Declaration on Fundamental Principles and Rights at Work 2000s Decent Work Agenda responds to global poverty World Commission on the Social
10、Dimension of Globalization Declaration on Social Justice for a Fair Globalization,The ILOs Decent Work Agenda,Work is central to peoples well being Creating decent work should be at the heart of development policy Make globalization more inclusive and fair,The ILOs Decent Work Agenda,Centered on the
11、 ILOs key strategic objectives Employment The principal route out of poverty is work Rights People in poverty need representation, participation and voice Protection Earning power is suppressed by marginalization and lack of support systems Dialogue The only way to solve problems peacefully,Current
12、world financial meltdown worst since the Great Depression World growth in 2009 will be lowest since the Second World War World trade expected to contract by 2.8% in 2009 after growing 7.8% annually over the past three years,A World in Crisis,The crisis is spreading,From largest industrialized nation
13、s to emerging economies to least developed countries Beyond the financial markets Credit crunch Waning consumer and business confidence International linkages World trade Commodity price drops Fall off in FDI and private capital flows Remittances falling for first time in decades Drop in development
14、 assistance?,Global unemployment in the formal sector could rise to 6.5% this year A total of 210 million people out of work 77 million workers in developing countries to be pushed into poverty Some hit especially hard Women Youth Migrants,and affecting the real economy,Case in Point: Women and the
15、Crisis,Number of unemployed women will rise by as much as 22 million in 2009 Women are often regarded as a flexible reserve, to be drawn into the labour market in upturns and expelled in downturns - i.e. casual, temporary, contract, and home workers,Shrinking economies and reduced social protection
16、tend to hit women and children harder,Women concentrated in export-oriented firms that are exposed to global slowdown,Its having far-reaching consequences,Risk of prolonged labour market recession Job losers tend to lose skills and get discouraged after one year of unsuccessful job search Rise in in
17、formal employment and working poverty Threats to social cohesion and stability, public support for globalization, achievement of MDGs Sense that innocent victims are hit, largely because benefits from earlier growth went mainly to high-income groups A social crisis is at hand,Problem: Unemployment a
18、nd informalisation are difficult to reverse,Duration of output recovery and job market recovery after the 1991 and 2001 recessions in the U.S. (in months),Source: Irons, John (2009) How long would a job-market recovery take? , Economic Policy Institute, January 7,Vulnerable employment to increase by
19、 113 million,Source: ILO, 2009, Global Employment Trends,Low Unemployment Insurance coverage in many economies,Share of unemployed workers NOT receiving unemployment benefits,Source: IILS estimates based on national statistics. For Brazil, recipiency rate is taken from Vroman and Brusentsev (2005),
20、Unemployment Compensation Throughout the World: A Comparative Analysis, and applied to the level of unemployment from the Dec. 2008 Labour Force Survey.,The challenge to be met,Preventing the financial crisis from becoming a long-lasting labour market and social crisis Averting widespread, major inc
21、reases in unemployment Avoiding long-lasting shift to informal work Staving off large increases in poverty among the worlds working poor,Most have taken some action Much of focus is stabilizing financial markets and attempting to restore liquidity Many economic recovery packages are targeted at the
22、real economy to stimulate demand Cutting taxes and boosting government spending Targeting infrastructure development Spending on education and health Extension of unemployment benefits, hiring incentives, retraining and other actions targeted to help workers and employers weather the crisis,What cou
23、ntries are already doing,Multilateral action,In April 2009, statement of the G20 London Summit of world leaders: Support those affected by the crisis by creating employment opportunities and through income support measures Support employment by stimulating growth, investing in education and training
24、, and through active labour market policies, focusing on the most vulnerable “We call upon the ILO, working with other relevant organisations, to assess the actions taken and those required for the future.”,But there are still many shortcomings,Action has been swift, but relatively unfocused Financi
25、al rescue measures are generally far in excess of fiscal tools to stimulate demand Impact has been limited to date Lack of coordination among countries Little attention to development assistance for poorer countries Structural causes are not being addressed Return to status quo (the “crisis before t
26、he crisis”) would leave the world vulnerable to future downturns,Financial rescue efforts vs. fiscal rescue efforts,Source: IILS, based on ILO, OECD & Bloomberg.,Case in Point: Unemployment Insurance,United States 2008 financial stimulus included extension of Unemployment Insurance benefits New admi
27、nistration indicates further extensions to come Europe Many countries expanding Unemployment Insurance duration, benefits and eligibility OECD recommends strengthening safety net in countries with short duration of UnemploymentInsurance benefits China Financial stimulus package expected to include i
28、ncome and employment support to jobless families,Canada: Economic recovery plan emphasizes training $1 billion for job training delivered through unemployment insurance programme $500 million strategic training and transition fund available to all individuals,$40 million for apprenticeship programme
29、s Long-tenured worker programme to extend Unemployment Insurance benefits while worker is being retrained,Case in Point: Skills and Job Training,The “Crisis Before the Crisis”,Prior to the onset of the current meltdown Global economy was not producing sufficient jobs where people live 86 million you
30、ng people were unemployed Existing framework of development not working for many people Globalization not delivering for them,Fate of developing countries hangs in the balance,“This is truly not the moment to let them down and to say sorry, we have to fend for ourselves One of the biggest problems w
31、e have is an enormous lack of coordination among all these stimulus packages, and that can easily lead to beggar-thy-neighbor policies, and we are already seeing indications of that.”Juan Somavia, Director-General, ILO,ILO Recommended Measures,Ensure flow of credit and stimulate demand Extend social
32、 protection and retraining Focus on the vulnerable Support productive and sustainable enterprises Small and medium-sized businesses and cooperatives Employment-intensive investment “Green jobs” Ensure restructuring of enterprises and sectors is socially sensitive,ILO Recommended Measures,Ensure core
33、 labour standards are promoted and not undermined or eroded Strengthen social dialogue, tripartism, and ILO role in multilateral system Maintain and expand development aid,Case in Point: Social Protection,Brasils Bolsa Familia: Federal cash transfer programme focused on poor families Serves 11 milli
34、on poor families, with a monthly income up to per capita (US$ 60.00) 2009 Budget: approx. US$ 5 billion - 0.4 % GDP,Conditioned on health monitoring for pregnant women and infants, child school attendance Integrated with programmes addressing child labour and forced labour Studies show significant s
35、uccess in reduction of poverty and child malnutrition, raising gender equity and economic activity Studies also show programme does not create disincentive to work,Case in Point: “Green Jobs”,Renewable energy 20 million jobs by 2030 Germany boosted jobs in renewables from 160,000 to 260,000 in just
36、two years China has 1,000 manufacturers of solar thermal panels employing 600,000 workers Recycling in China employs 10 million workers Columbias ethanol mandate is expected to create 170,000 jobs World Bank: Biofuels could generate 1.1 million jobs in Africa,Case in Point: Employment Intensive Inve
37、stment,Productive and social infrastructure, protection of the productive resource base Roads, irrigation, construction and rehabilitation of schools and health centres, forestation, soil and water conservation 3-5 times more direct jobs created Multiplier effect: 1.6 2.0 Foreign exchange: typically
38、 50% savings Costs: typically 20% cheaper Contribution to increased GDP,Case in Point: Social Dialogues Value in Crisis,Ireland Faced serious economic difficulties into the 1980s 1987 - Social partners and government concluded first in series of tripartite agreements on national recovery Country sub
39、sequently became economic leader in Europe,Case in Point: Social Dialogues Value in Crisis,Republic of Korea History of hostile relationship between unions and the state Creation of Tripartite Commission to address 1997-98 Asian financial crisis Social Agreement of 1998 enabled layoffs, expanded wor
40、kers rights and gave government flexibility to act against crisis Economic recovery followed soon thereafter,Needed: A Global Jobs Pact,Address similar problems at the same time with a global approach Stimulus packages should be more employment oriented Target small- and medium-sized enterprises Res
41、ponsible for most of new and existing jobs in most countries,Avoid wage deflation and pave the way toward a more sustainable economy through greater emphasis on Social Protection Workers Rights / Social Dialogue,To restore credit Condition government financial support on provision of credit for viab
42、le new projects Direct access to government loans for small- and medium-sized businesses To ensure fiscal stimulus boosts economic activity Target employment-intensive areas Support to small- and medium-sized enterprises Ensure workers have the skills to respond to new requirements Promote rural and
43、 agricultural dimensions critical in developing countries,How a Global Jobs Pact would work,How a Global Jobs Pact would work,To account for the lags in launching new infrastructure projects Provide support to existing jobs through shorter working hours, partial Unemployment Insurance benefits and t
44、raining Enhance social protection through well-designed programme and make it broad-based To strengthen the safety net for those who lose or cannot find jobs Unemployment Insurance benefits and employment guarantees Active labour market and training programmes Specific attention to vulnerable groups
45、 women, youth, migrants,Case in Point: Small and Medium Enterprises,More than 95% of OECD enterprises are classified as SMEs Account for up to 70% of the working population Dynamism and flexibility However, they are also among most vulnerable in crisis Weaker financial structures and limited access
46、to credit Often dependent on global value chains ILO has resources and provides policy advice aimed at strengthening SME finance Microfinance, mico-leasing, micro-insurance and mutual guarantee systems,Summing it up,Global economic crisis is deepening Risk of prolonged labour market recession Countr
47、ies are acting but rescue packages thus far not sufficient Too much financial, not enough fiscal Need more focus on creating decent work and protecting people Too little coordination among nations Not enough attention to development dimensions of the crisis Social stability is at risk, particularly
48、in developing countries,Summing it up,Prescriptions for a more sustainable economy Restore credit and ensure that banks lend to viable businesses Target small and medium enterprises, the engines of job growth, in credit restoration and infrastructure projects Provide employment benefits and broad-ba
49、sed social protection to help workers and families weather the downturn Use social dialogue and worker protections in countries to avoid wage deflation Motivate multilateral institutions to work cooperatively toward more balanced globalization that promotes sustainability from economic, social and environmental viewpoints,
