The global employment crisis

Митинг безработных

Unemployment has shown its darker side, becoming perhaps the biggest economic and social problem worldwide. The current situation is not very different from the Great Depression of the 1930s, when millions of people were left without work.

At that time, the lack of jobs, according to some historians, contributed to the Second World War. In the present, is an important factor in street protests in Europe and in the overthrow of governments in countries like Egypt. Today, as then, there is confusion over the issue of unemployment and political intellectuals discuss its causes and how to deal with it.

According to the International Labour Organization (ILO), there are more than two hundred million unemployed worldwide. Last year, the figure had risen by 4.2 million, and this is expected to grow by another five million.

Today there are twenty-eight million more unemployed than in 2007, when the global financial crisis began. But the figure rises to sixty-seven million as "global jobs gap" if it includes those who chose to leave to find work. For young people, there are over seventy-three million unemployed worldwide, equivalent to 12.6 percent, but in some countries the figure goes up to 40 percent, causing frustration and rebellion.

Employment was one of the main issues discussed last week at a Working Group of the United Nations responsible for the development of Sustainable Development Goals (SDG). In fact, the United Nations should take the issue as a matter of highest priority, for obvious reasons. It is the most important indicator to detect if an economy is healthy and socially stable, as people with work are more likely to escape poverty and basic needs.

For this reason, the "full employment" must be accepted as a major SDG. And the "employment" should include formal jobs and livelihoods in the rural and urban sectors.

Full employment was widely recognized as the main objective of economic policy of the post-World War II. Political leaders pledged not to go through a long period of high unemployment any more, as occurred during the Great Depression.

After the war  international organizations like the International Monetary Fund (IMF), the ILO, the General Agreement on Tariffs and Trade (GATT) and the United Nations Conference on Trade and Development (UNCTAD) were created, and employment was one of its main priorities. One of the first United Nations conference in 1947 had as its main theme the trade and employment, and led to the creation of the multilateral trading system.

"Ensuring full employment" is a major goal of the World Trade Organization and the IMF has as one of its main purposes "the promotion and maintenance of high levels of employment and real income."

In the careers of university of economics and government in political circles, the achievement of full employment is considered the top priority of economic policy, along with adequate economic growth.

However, the goal of full employment lost momentum from 1980, being relegated by others, such as controlling inflation, reducing the fiscal deficit, the elimination of tariffs and reducing the size and role of government . These other objectives became the center of the Washington Consensus policies and the "structural adjustment" that the IMF and World Bank imposed on countries as a condition for granting loans. Many developing countries with debt problems adopted these policies to avoid default.

Today the story repeats in several European countries adopting "austerity" as a priority policy, ignoring employment and growth.

The increase in unemployment, accompanied by the recession and inequality, catapulted creating jobs as central claim for popular demands caused by the austerity plan.

The waging political battle is going on between those who insist on the need to tackle unemployment and, while resolving the budget deficit in the medium term, and advocates adopting tough austerity measures at all levels.

The anti-austerity camp are gaining ground slowly, because the facts show an increase in unemployment and a fall in growth rates.

Developing countries are being affected more and more by the austerity policies, especially since the slowdown of large Western economies is now affecting exports, currencies, capital flows and growth rates.

To avoid worsening the employment situation, developing countries need favorable international policies, such as those listed below:

* Developed countries should avoid policies that harm national employment situation of developing countries.

* The international financial institutions and aid agencies should avoid advising policies and impose conditions that adversely affect employment in developing countries.

* International agencies must adopt as a priority objective of full employment in developing countries.

* The criteria for debt sustainability in developing countries should take into account the requirements to create enough jobs.

* The rules and trade negotiations should give top priority to the maintenance and promotion of employment in developing countries.

Full employment should be restored throughout the world as the main objective of economic policy. This should result in it becoming a top priority of national goals and objectives, particularly in the fiscal and development policies.