3 out of 4 workers in India fall in vulnerable employment category: ILO
BusinessToday.in January 24, 2018
Apparently it is not just jobless growth that we should be worrying about. Rather, according to a new report by the International Labour Organization (ILO), a far greater concern is the fact that vulnerable employment is on the rise. According to the World Employment and Social Outlook: Trends 2018 report, while the global unemployment rate is expected to stabilize at around 5.5% over the next couple of years, the significant progress achieved in the past in reducing vulnerable employment has essentially stalled since 2012.
As ILO Director-General Guy Ryder puts it, "decent work deficits remain widespread". Almost 1.4 billion workers globally are estimated to be in vulnerable employment in 2017 - a majority live in Asia - and an additional 17 million are expected to join the ranks per year in 2018 and 2019.
So what is vulnerable employment? Vulnerable employment is often characterized by inadequate earnings, low productivity and difficult conditions of work that undermine workers' fundamental rights. It is defined as the sum of the employment status groups of own account workers and contributing family workers. They are more likely to be informally employed, and are therefore more likely to lack a 'voice' through effective representation by trade unions and similar organizations.
In India, vulnerable employment roughly affects three out of four workers-77% of total workers according to World Bank (derived from ILO data). This, while all eyes have focussed on the unemployment rate. ILO actually projects the latter to stay steady at 3.5% till 2019-thanks to its rapid labour force growth, Southern Asia (which includes India) is expected to account for close to 90% of the total employment growth in Asia and the Pacific in 2018-though that means that the number of unemployed will go up from 18.6 million in the coming fiscal to 18.9 million in the next.
Worse still, a large proportion of the jobs being created is of poor quality, and expected to remain so. The report notes that "while there has been strong job creation in some ICT-intensive services, notably in India, a significant portion of the jobs created in the services sector over the past couple of decades have been in traditional low value added services, where informality and vulnerable forms of employment are often dominant."
Other regions in Asia are faring far better. The share of vulnerable employment in total employment in South-Eastern Asia and the Pacific (which includes Cambodia, Indonesia, Singapore and Australia) is expected to stay steady at 46% till 2019 and the figure is pegged at 31% for Eastern Asia (China, Japan, Taiwan et al). In the developed world, the figure is under 10%, but that's still 56.5 million people.
"Underlying these aggregate labour market and social trends are disparities across a number of demographic groups. Gender disparities are of particular concern," says ILO, adding that in Southern Asia, vulnerable employment rates among women are 8 percentage points higher than those of men.
The lack of employment opportunities for youth (i.e. those under 25 years of age) presents another major global challenge. Young people are much less likely to be employed than adults, with the global youth unemployment rate standing at 13 per cent, or three times higher than the adult rate of 4.3 per cent. The corresponding figure of Southern Asia is 9.5%.
On a more positive note, the report notes that the incidence of working poverty is expected to continue on its downward trend. As of 2017, 295.5 million people in Southern Asia were living in moderate or extreme poverty, which is projected to come down to 285.5 million in 2018 and about 276 million the year after. "Additional efforts need to be put in place to improve the quality of work for jobholders and to ensure that the gains of growth are shared equitably," said Ryder. However, the high incidence of informality-it affects around 90% of all workers in India-continues to undermine the prospects of further reducing working poverty.