Development & Aid, Economy & Trade, Global, Global Geopolitics, Headlines, Human Rights, Labour, Migration & Refugees, Poverty & SDGs

LABOUR: Few “Decent Jobs” in the Booming Informal Economy

Ernst-Jan Pfauth

UNITED NATIONS, Feb 9 2007 (IPS) - The service sector, comprising finance, banking and tourism, but also much lesser-paid jobs in retail and food services, overtook agriculture as the largest source of employment last year, according to a report released this week by the U.N. Commission for Social Development.

The report is part of the Commission’s forty-fifth session whose main theme is “Promoting full employment and decent work for all”.

For the first time, the service sector provided 40 percent of global jobs compared with 38.7 percent in the agriculture sector. Self-employment also grew considerably in recent years.

In the United States, 18.6 million people are self-employed. In developing countries, 60-70 percent of people working in the informal sector, outside agriculture, are self-employed. Mehdi Danesh-Yazdi, chair of the Commission for Social Development, calls these developments the “casualisation of the workforce”.

Danesh-Yazdi noted that many in the service sector, as well as those who are self-employed sector, have no job protections, are not covered by labour laws and are not entitled to benefits or pensions.

“A place of employment is somewhere where it is safe and secure,” he said at a press conference at U.N. headquarters Wednesday. “We have to create conducive environments for people to work. We are speaking of decent work.”

Danesh-Yazdi stressed that the commission’s work deserves more attention from U.N. member states. Developed countries should acknowledge and promote the problems, since, “The three major issues – poverty eradication, employment social integration – are extremely important for all member states.”

Marion Williams, governor of the Central Bank of Barbados, added that the “hands-off approach” of the developed countries is about to change. Due to increasing globalisation, problems causes by unemployment are not only primarily affecting the developing countries anymore.

“It will be politically expedient to have these problems addressed in developed countries, and I think, therefore, the resources will be put in place in order to address them,” Williams said.

Strong growth in global economic output – 3.8 percent per year in the last decade – has not improved the employment climate. The number of jobless people worldwide has risen 22 percent, to 195 million people.

Williams noted that new technology and economic processes leads to a situation in which more products are made by fewer human workers. Moreover, private sector competition in the context of increased globalisation has led to shakier job security and a reduction in job-related benefits.

Williams called for a shift in focus from the economic position to the social position of developing countries. “The world cannot stick to monetary matters,” she said. “Economic growth increases social inequality, only wealthy countries do benefit from it.”

The U.N. report also pointed out that, “Almost half of the world’s unemployed are young people, although youth make up only 25 percent of the working-age population. In most areas, youth unemployment rates are up to three times that of the general population. This unemployment rate causes juvenile crime and threatens safety and stability. In many places juvenile crime has risen by more than 30 percent since 1995.”

As a consequence of these developments, migration flows – intensified by economic and political instability in many countries – are increasing.

Migrants often lack the skills required to operate in the formal economy and are frequently discriminated against. “Some highly educated people do pity jobs – they should have good jobs,” Danesh-Yazdi said.

Williams pointed out that local producers of bananas, sugar and other commodities in the Caribbean are facing stiff competition from multinational corporations. She does not necessarily think of this competition as a bad thing, but rather looks at it as a challenge in that it forces local governments to think creatively and find new jobs for former farmers.

For instance, Barbados is exploring the option, together with partners from Brazil, to produce ethanol from sugar plants. According to Williams, labour – as long as it is properly managed and sequenced – can move as well.

Danesh-Yazdi expressed the hope that national delegations to the commission would find ways to work together in a cooperative fashion. “A collective position is important,” he said. “Together we have to make plans for the years to come.”

He said that this year is intended to be a review year, so the commission’s current session, which started Feb. 7 and will end Feb. 16, will not produce a discussed text.

The commission is planning to debate policy recommendations next year. During the 2008 session, Danesh-Yazdi hopes to take “bold” steps and find solutions for the major issues on its agenda.

“Next year will be a crucial year for setting policies for the work of the commission, for the future,” he said. “Next year will be a hectic year.”