Published : 5 months ago, on 29/05/2024

Global unemployment to slightly fall in 2024, UN labour body says

By Matteo Allievi

(Reuters) -The global unemployment rate is expected to fall slightly to 4.9% this year from 5.0% in 2023, even as inequalities in labour markets persist, the International Labour Organization (ILO) said on Wednesday.

The ILO, a United Nations agency, in January estimated unemployment to edge up to 5.2% due to an expected rise in joblessness in advanced economies.

The revision is mainly due to lower-than-expected unemployment rates in China, India, and high-income countries reported so far this year, the agency said.

“China’s growth wasn’t quite as poor as had been anticipated late last year as the Chinese authorities have once again managed to keep the ball rolling a little longer there,” said Richard de Chazal, macro analyst at investment banking group William Blair.

The downward trend for joblessness is expected to flatten in 2025, with unemployment remaining at 4.9%, the report said.

Global economic growth has been slightly more robust than expected in the first months of 2024, particularly in the United States, while inflation has been decreasing, giving a breather to household incomes.

“The lagged effects of higher interest rates have been a slower burn, in large part because both the corporate sector and the household sector locked in lower rates and have been much less sensitive to Federal Reserve’s tightening this time”, de Chazal added.

The International Monetary Fund in April raised its 2024 forecasts for global growth to 3.2% from the 3.1% estimated in January, largely due to an improvement in the U.S. outlook.

“This stabilisation in the macroeconomic environment is translating into a relatively stable labour market outlook,” the ILO said.

But in the medium term the situation remains uncertain due to the monetary and fiscal policy adjustments expected globally with restrictive macroeconomic policies having a delayed effect on the labour market, it added.

Despite the improving outlook, the Geneva-based organisation highlighted a “persistent” lack of employment opportunities.

It estimates that the jobs gap, which measures the number of persons without a job but wanting to work, will stand at 402 million people in 2024, up from 399 million last year.

The report showed that the labour market remains an “uneven playing field” especially for women, said the ILO Director-General, Gilbert F. Houngbo, as their jobs gap in low-income countries reached 22.8% compared to 15.3% for men.

In the high-income countries, the rate is 9.7% for women and 7.3% for men.

(Reporting by Matteo Allievi; Editing by Andrea Ricci and Jane Merriman)