The Foremost Priority

• Author: Sharan Burrow
• Position: General Secretary of the International Trade Union Confederation.

Point of View

The global employment deficit remains a glaring indictment of the failures of economic policies applied in the postcrisis period, more than six years after the start of the worst global financial crisis and recession since the Great Depression of the 1930s.

According to the International Labour Organization’s (ILO’s) World Employment and Social Outlook, the global unemployment rate in 2014 was 5.9 percent, representing more than 200 million people out of work, and considerably higher than the 2007 precrisis rate of 5.5 percent.

These figures do not take into account the hundreds of millions of workers who are underemployed, work in informal economy jobs, or do not earn enough to raise themselves and their dependents above the poverty line. The ILO notes that some 760 million workers, who represent 28 percent of the employed population in developing countries, are in the category of “working poor”—earning less than $2 a day.

Nor does the ILO’s jobless figure include those no longer engaged in fruitless job searches (so-called discouraged workers). This explains why labor force participation in 2014 was even lower than at the height of the recession in 2009. Because of the lower participation rate, the ILO projected a global employment-to-population ratio of 59.7 percent in 2014, the same as in 2009 and well below the 2007 precrisis figure of 60.7 percent.

Policy shortcomings

For the first two years after the start of the crisis, the international community, via the Group of 20 advanced and emerging market economies (G20) and international organizations, led a concerted effort to save the financial sector from collapse, stop the downward spiral of global economic activity, and help get the global labor force back to work. But once the first two objectives were achieved, with the financial sector stronger than ever and profits back to precrisis levels, the third objective was abandoned.

Bailouts of the financial sector and stimulus policies to end the recession gave way in 2010 to premature and frequently self-defeating efforts to reduce fiscal deficits, most often through cuts in social programs and other public expenditures and increases in regressive taxation.

These policies not only worsened the conditions of those most dependent on state support, but they cut short the fragile recovery in many countries, most particularly in the euro area, which by 2012 had fallen into a double-dip recession. The purported...