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U.N. Labor Body Urges Full Employment Drive

Reuters. 26 November 1996

GENEVA (Reuter - The International Labor Organization says the world employment situation is grim, with one billion people, or nearly a third of the global workforce, out of work or under-employed.

In its second World Employment Report, released in Geneva Tuesday, the United Nations agency called on governments to drive for full employment and denounced as "heartless and pernicious" assertions that large-scale joblessness was inevitable in a globalizing economy.

"The current high unemployment in industrialized countries has human costs of the utmost severity for those directly involved and breeds crime and other social pathologies from which everyone in society suffers," the ILO said.

"There is thus a strong economic as well as moral case for reinstating full employment ... as a principle objective of economic and social policy."

Among the 28 most developed countries, at least 34 million were out of work. The average for the 15-nation European Union was 11.3 per cent, it said.

Although job creation and unemployment had dipped in both the United States and Britain, income disparities had tended to widen, it said.

Joblessness was on the rise in Russia and other former Soviet states as well as in Latin America, it added.

Compiled by ILO economists and statistical analysts, the report argued there was no substantial evidence that technological progress and world trade liberalization were responsible for job losses, especially in advanced economies.

Both were necessary to stimulate growth and productivity, and the experience of dynamic Asian economies showed that "sound domestic policies, expanding global trade and investment flows provide rich opportunities for higher rates of economic growth and job creation," the ILO said.

The report argued that the way out of the jobless spiral was to reverse the trend towards declining growth rates in major economies over the past two decades.

Growth has fallen from a global average of over 5 percent in the 1960s to under 3 percent now, it noted.

It rejected arguments that efforts to boost growth would inevitably spark inflation and founder.

Lack of demand could well be responsible for slow growth in the world economy since the 1970s, and wage inflation could be held in check if industrial practices and labor-market regulations were designed to support that aim, the report said.