Global employment situation 'grim.' (includes related article on the establishment of a trust fund for least developed countries)

Nearly 1 billion people around the world - approximately 30 per cent of the entire global work force - are unemployed or underemployed in industrialized and developing countries alike, says a new report by the International Labour Organization (ILO).

In its report, World Employment 1996/97, ILO calls the global employment situation "grim". It warns that the growing numbers of "working poor" risk aggravating the social and economic ills caused by high jobless rates.

In the world's wealthiest nations - members of the Organisation for Economic Cooperation and Development - at least 34 million people are unemployed. In the European Union, unemployment increased last year to an average of 11.3 per cent of the workforce, with France, Germany, Italy and Sweden registering significant increases. In the United States, on the other hand, job creation has intensified and unemployment has dipped below 5 per cent. Unemployment rates have also declined in the United Kingdom. In both those countries, however, income disparities have tended to widen.

In the transition economies of Eastern and Central Europe, unemployment rates declined slightly, but remained at double-digit levels. In Russia and some other countries of the former Soviet Union, unemployment continued to increase.

Among Latin American countries, Colombia posted a rise in unemployment from 8 to over 10 per cent. Unemployment increased in urban areas in Argentina, Bolivia, Ecuador, Jamaica, Mexico, Uruguay and Venezuela. In sub-Saharan Africa and many parts of Asia, data on direct unemployment hardly exists, but problems of massive underemployment and poverty persist in these low-income regions.

ILO believes that nothing short of a renewed international commitment to full employment is required to reverse the poverty, unemployment and underemployment now prevailing in so many parts of the globe.

It identifies the underlying causes of deteriorating labour market conditions as being:

* lower growth rates in industrialized countries since 1973 and the failure of most developing economies to recover fully from the economic crisis of the early 1980s;

* slow adjustment of wages to declining labour productivity and the emergence of wage inflation, which lasted until the mid-1980s;

* progressive eviction from the world of work of the long-term unemployed and the increasing casualization of millions of workers in informal sector activities.

The report concludes that, while there is no single ideal prescription for developing, industrialized and transition economies, the "priority requirement for reversing the prolonged deterioration in employment conditions is the restoration of high and sustained rates of economic growth".