World’s Power Must Act Urgently as Global Joblessness grows – UN Labour Chief

kristy Reforming Global Finance

CHIEF New York, Oct 11 2012 2:05PM Projecting that global unemployment will
rise by seven million next year to 207 million, three million more than
previously estimated, the United Nations labour agency today called on the
world’s major economies to act on their pledge to take urgent action if the
economic crisis worsens.

“It is now abundantly clear that such deterioration is under way, and
additional measures are urgently needed,” the UN International Labour
Organization’s (ILO) Director-General, Guy Ryder,
<“–en /index.htm”>said on the margins of the annual meeting of the International
Monetary Fund (IMF) and World Bank Group in Tokyo.

“The countries that indicated their willingness to join such a coordinated
effort account for half of global output and so could have a pronounced
effect on global conditions,” he added, citing Argentina, Australia, Brazil,
Canada, China, Germany, the Republic of Korea, Russia and the United States
as having pledged in June to coordinate and implement additional measures to
support demand if the global economic situation deteriorated.

The nine made the commitment at a summit of the Group of 20 (G20) leading
economies earlier this year in Los Cabos, Mexico. Coordinated action by the
world’s leading economies can and must prevent a slide into what he
described as a political, economic and social quagmire, Mr. Ryder stressed.

New ILO figures, based on the IMF’s downward revision of global economic
growth earlier this week, predict that unemployment will rise by seven
million in 2013, adding to the current 200 million out of work worldwide.
This adds a fresh three million to the previous ILO estimate of a rise of
four million in 2013.

Mr. Ryder said the latest IMF World Economic Outlook recognises that many
governments which embarked on austerity measures underestimated the negative
impact of these measures. “This means that these austerity measures caused a
larger damage to the economy than previously thought,” he stressed.

Global unemployment is still 30 million higher than before the crisis
started in 2008 and nearly 40 million more people have dropped out of the
labour market since then. At the same time, the IMF estimates that the
benefits of earlier stimulus measures taken since the crisis began have been
two to three times higher than previously thought.

A more gradual reduction of debt, combined with low interest rates would
have substantial multiplier effects. “And if countries embark on this
approach simultaneously, we could put the global economy onto a sustainable
recovery and growth track,” he said.

New initiatives should focus on four main areas: supporting infrastructure
investment, improving access to bank funding for small and medium
enterprises, extending the coverage of social protection and investing in
jobs for young people.
For more details go to UN News Centre at