A new report by the International Labour Organisation, ILO, an arm of the United Nations UN, has revealed that only a quarter of workers worldwide are estimated to have a stable employment relationship.
The Report, World Employment and Social Outlook 2015 WESO shows that among countries with available data (covering 84% of the global workforce), three quarters of workers are employed in non-standard roles; on temporary or short-term contracts, in informal jobs often without any contract, under own-account arrangements (self-employed, potentially with one or more partners, and has no employees on a continuous basis), or in unpaid family jobs.
Further, it indicated that over 60% of all workers lack any kind of employment contract, with most of them engaged in own-account or contributing to family work in the developing world. However, even among wage and salaried workers, fewer than half (42%) are working on a permanent contract.
The first edition of the new ILO report, entitled The Changing Nature of Jobs, shows that while wage and salaried work is growing worldwide, it still accounts for only half of global employment, with wide variations across regions. In the developed economies and Central and South-Eastern Europe, around eight-in-ten workers are employees, whereas in South Asia and Sub-Saharan Africa the figure is closer to two-in-ten.
Another current trend is the rise in part-time employment, especially among women. In the majority of countries with available information, part-time jobs outpaced gains in full-time jobs between 2009 and 2013.
According to the ILO Director, Guy Ryder, “These new figures point to an increasingly diversified world of work. In some cases, non-standard forms of work can help people get a foothold into the job market. But these emerging trends are also a reflection of the widespread insecurity that’s affecting many workers worldwide today.”
“The shift we’re seeing from the traditional employment relationship to more non-standard forms of employment is in many cases associated with the rise in inequality and poverty rates in many countries. What’s more, these trends risk perpetuating the vicious circle of weak global demand and slow job creation that has characterised the global economy and many labour markets throughout the post-crisis period.”
“The way forward is to ensure that policies take into consideration the evolution of how we work today. This means stimulating investment opportunities to boost job creation and productivity, while ensuring adequate income security to all types of workers, not just those on stable contracts,” Mr. Ryder added.
Income inequality is increasing or remains high in the majority of countries – a trend that is aggravated by the rising incidence of non-permanent forms of employment, growing unemployment, and inactivity. The income gap between permanent and non-permanent workers has increased over the past decade.
The report found that despite the positive steps made towards improving pension coverage; social protections, such as unemployment benefits, are still mainly available only for regular employees. For the self-employed, even pensions are scarce: in 2013, only 16% of the self-employed contributed to a pension scheme.
According to the report’s authors, there is a growing recognition that labour regulation is necessary to protect workers – especially those in non-standard work – from arbitrary or unfair treatment and to enable effective contracts between employers and workers.
Employment protection laws have been very gradually strengthening over time, a trend that is common across most countries and regions.
However, in Europe, labour protection has generally decreased since 2008 when the global financial crisis started.
Director of the ILO Research Department and lead author of the report, Raymond Torres said, “The key issue is to match regulation to an increasingly diversified labour market. Well-designed regulations can support both economic growth and social cohesion.”
The reports further revealed that at the global level, employment growth has stalled at a rate of around 1.4% annually since 2011. In the developed economies and European Union, employment growth since 2008 has averaged only 0.1% annually, compared with 0.9% between 2000 and 2007.
Nearly 73% of the global jobs gap in 2014 was due to a shortfall in employment among women who make up only around 40% of the global labour force.
The direct impact of the global jobs gap on the aggregate wage bill is substantial: it corresponds to an estimated USD 1.218 trillion in lost wages around the world. This is the equivalent to about 1.2% of total annual global output and approximately 2% of total global consumption.
Across 86 countries covering 65% of global employment, more than 17% of employed persons were working on a part-time basis of less than 30 hours per week. The number of women engaged in part-time employment stood at 24% compared with 12.4% for men.
Out of 40 countries (representing two thirds of the global labour force), 453 million people were employed in global supply chains in 2013, compared with 296 million in 1995. This represents a share of 20.6% of total employment in the countries covered, compared with 16.4% in 1995.
At the global level, 52% of employees are currently affiliated to a pension scheme, compared with 16% of the self-employed.
Nearly 80% of employees with a permanent contract are currently contributing to a pension scheme, compared with just above half (51%) of employees with temporary contracts.