It is what the new report “World Employment and Social Outlook: Trends 2025” released by International Labour Organization (ILO) has summed up. Informal work and those categorized as the working poor, returned to pre-pandemic levels, and low-income countries faced the most difficulties in creating decent jobs for their citizens in 2024.

As the year 2024 progressed towards its end, economic growth slowed down, bringing the economic expansion at a moderate rate, which is likely to continue through 2025 and over the medium term, the report said, adding that economy has not fully caught up with the pandemic-related loss of earnings, in part because of weak employment growth. Real wages in most countries are still recovering from the aftermath of the past crises, while it increased in only in some advanced economies.

The global jobs gap – the estimated number of people who want to work but do not have a job – reached 402 million in 2024. This includes 186 million unemployed, 137 million who are temporarily unavailable to work and 79 million discouraged workers who have stopped looking for jobs.

Unemployment rate remained steady at 5 per cent in 2024. However, youth unemployment showed little improvement, remaining high at 12.6 per cent. Economic slowdown has made the recovery in the job market challenging. Economic growth stood at 3.2 per cent in 2024, down from 3.3 and 3.6 per cent in 2023 and 2022, respectively. A similar level of growth is expected in 2025, although a gradual deceleration is expected to set in over the medium term. Although inflation has decreased, it remains high, reducing the value of wages.

Among young men participation has fallen sharply, with many not in education, employment or training (NEET). This trend is especially pronounced in low-income countries, where NEET rates for young men have risen by nearly 4 percentage points above the pre-pandemic historical average, leaving them vulnerable to economic challenges.

NEET rates in low-income countries rose in 2024, with young men reaching 15.8 million (20.4 per cent) and young women 28.2 million (37.0 per cent), marking increases of 500,000 and 700,000 respectively from 2023. Globally, 85.8 million young men (13.1 per cent) and 173.3 million young women (28.2 per cent) were NEET in 2024, up by 1 million and 1.8 million respectively from the previous year.

Little progress is witnessed in resolving decent work deficits. Moreover, other social indicators have shown little sign of improvements since 2015. Working poverty,

while improving globally, persists in low-income countries; extreme forms of working poverty affect 240 million workers or 7 per cent of the global workforce. Informality remains high and enduring in many parts of the world; more than half of the global workforce are not adequately covered by social security arrangements, legal protection or workplace safety measures. Inequality has increased. Reductions in working poverty and informality have been concentrated in a few countries in Eastern and South-Eastern Asia and Latin America. Many other countries have seen only limited reductions of informality and working poverty and continue to struggle to provide decent work.

With the return to pre-pandemic levels of informality and working poverty, the job recovery has lost much of its ability to generate further improvements and close the gap with the targets of the Sustainable Development Goals (SDGs). As the economic and social outlook remains highly uncertain – with geopolitical frictions, rising costs of climate change, and unresolved sovereign debt risks – the resilience of labour markets is being tested. Low-income countries appear to be particularly vulnerable, since progress in decent work creation has been slowest in these countries.

Demographic shifts in advanced and some large emerging economies continue to be felt, while labour shortages have somewhat eased but not completely disappeared. Especially among European countries, labour hoarding remains high, preventing a faster return to pre-pandemic trends. Investment rates have fallen again and energy price hikes have taken a toll on industrial production. Except in Northern America, productivity growth shows no signs of acceleration despite major technological advances, especially in information technologies and medical research.

Though inflation rates have come down in 2024, and the central banks have manged to bring inflation rates down without causing a major labour market recession, the price levels remain elevated, and inflation rates have yet to drop to target rates in much of the developed world. However, further tightening, especially by fiscal policymakers, would run the risk of causing serious social disruption as some high-inflation countries have recently experienced while trying to bring down their inflation rates.

Economic deceleration, high prices and inflation are the chief causes of preventing real wages from recovering, but part of the reason of real wage growth remaining weak has also to do with the shift in labour market power away from workers towards employers over the past decades, with particularly adverse effects for vulnerable groups and young people.

Gender gap remains high even though women labour force participation rate has improved a little. The high gender gap means that countries forgo a significant potential for improvements in living standards. Moreover, where gaps have been falling, this has often come about not from improved female participation, but from continuous decline in male participation rates, especially among young men. Increase of almost 4 per centage points in young men’s NEET rate above the historical average leaving many young men less well equipped to successfully participate in the labour market and more vulnerable to future shocks. (IPA Service)