Global employment crisis will stir social unrest, warns UN agency

Global employment will not recover to pre-crisis levels until 2015 if current policies are pursued, creating social tension, the International Labour Organisation has warned

Rubbish bins burn in central Barcelona during the general strike Photo: AFP/GETTY

Riot police hit out at demonstrators during protests in Barcelona, Spain Photo: AP

The United Nations work agency said it was putting back by two years from 2013 its previous assessment of the time needed to create the 22 million jobs still needed to regain the pre-crisis level - 14 million in rich countries and 8 million in developing states.

The global economy has started to grow again with encouraging signs of employment recovery especially in some Asian and Latin American emerging economies, the ILO said in its annual World of Work report.

"Despite these significant gains ... new clouds have emerged on the employment horizon and the prospects have worsened significantly in many countries," it said.

Raymond Torres, lead author of the report, told a news conference that job losses since the crisis started had totalled some 30-35 million. The ILO has forecast global unemployment this year of 213 million, a rate of 6.5 per cent.

For the United States - where persistent unemployment has become one of the main issues in this November's elections - the number of jobs still needed to regain pre-crisis levels is 6.9 million, Steven Tobin, ILO economist, said.

The extended loss of employment and growing perceptions of unfairness risked increasing social tension, the ILO said.

In 35 countries for which data exists, nearly 40 per cent of jobseekers have been without work for more than one year, running risks of demoralisation and mental health problems, and young people were disproportionately hit by unemployment.

It noted that social unrest related to the crisis has been reported in at least 25 countries, including some recovering emerging economies.

This week riot police were on the streets as protesters in Spain, Belgium, Italy and Greece demonstrated against tough austerity measures.

In more than three quarters of 82 countries with such information available, peoples' perceptions of their quality of life and standard of living had declined in 2009 from 2006, with job satisfaction also declining even among those in work.

Torres warned governments against withdrawing fiscal stimulus measures while recovery was still weak.

The ILO recommended three policies for a jobs-led recovery:

* A combination of active labour market policies including work-sharing that target vulnerable groups such as young people, and training;

* A closer link between wages and productivity gains in surplus countries to boost demand and job creation;

* Reforms of the financial sector to ensure savings are channelled to productive investment.