Sharp Rise in Unemployment from Global Recession

SUMMARY

The global financial crisis has sharply increased unemployment across the world to more than 210 million people, up 30 million since 2007, hitting advanced economies especially hard and having long-term social repercussions, including on health and the children of those laid off, the IMF says.

 
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  • Conference to address jump in unemployment, long-term effects
  • More than 440 million new jobs needed over next 10 years
  • In near term, fiscal and monetary policies should support recovery and job creation
  • The International Monetary Fund and the International Labour Organization (ILO) issued the stark assessment of the outlook for employment in the wake of the global financial crisis, saying that the world faces major challenges in creating enough quality jobs to sustain growth and development.

    The two organizations issued a background document ahead of a joint high-level IMF-ILO conference on September 13 in Oslo, hosted by Norwegian Prime Minister Jens Stoltenberg, to explore new ways of forging a sustainable, job-rich economic recovery. The one-day conference on “The Challenges of Growth, Employment and Social Cohesion” will bring together political, labor, and business leaders, as well as leading academics.

    In many advanced economies, unemployment remains at very high levels, with little sign of an early fall, while in emerging and developing countries the economic shock hit jobs in export sectors hard, but these are now recovering, in part as exporters have diversified their markets to rely less on those of the advanced economies.

    The 2007–09 slowdown also hit the large informal economies of the developing world. Informal employment has increased, and the numbers of working women and men who cannot earn enough to keep themselves and their families out of poverty have risen.

    Painful legacy

    Lead speakers at the conference include President Ellen Johnson Sirleaf of Liberia, Prime Minister George Papandreou of Greece, Prime Minister José Luis Rodríguez Zapatero of Spain, Finance Minister Christine Lagarde of France, U.K. Secretary of State for Labor Iain Duncan Smith, and International Trade Union Confederation General Secretary Sharan Burrow. The conference will be chaired by IMF Managing Director Dominique Strauss-Kahn and ILO Director General Juan Somavia.

    “The Great Recession has created a painful legacy of unemployment,” said Strauss-Kahn, “and this devastation threatens the livelihood, security, and dignity of millions of people across the world. The international community must rise to meet this challenge. Now is the time for our collective action.”

    The unemployment rate has increased by 3 percentage points in advanced countries since 2007 and by a ¼ percentage point in emerging markets. Within the advanced economies, some...

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