ILO: Global economy on brink of jobs recession

| October 31, 2011 | 0 Comments

The International Labour Organization (ILO) has warned that the world economy is heading towards a new jobs recession, which could trigger social unrest in some countries.

The recent slowdown in the global economy is “dramatically” affecting labour markets and it is expected to take at least five years for employment in developed economies to return to pre-crisis levels, according to its “World of Work Report 2011: Making Markets Work for Jobs”.

Raymond Torres, director of the ILO International Institute for Labour Studies, said in a statement: “We have reached the moment of truth. We have a brief window of opportunity to avoid a major double-dip in employment.”

Separately, the Organisation for Economic Co-operation and Development (OECD) is urging G20 leaders to take “bold decisions” when it meets for a summit in Cannes later this week, in order to avoid recession.

The OECD’s comment comes as it is forecasting a sharp slowdown in growth in the euro zone, while warning that some nations in the 17-member bloc could face negative growth.

The OECD is predicting growth of 1.6% in the euro zone this year, with a sharp slowdown to 0.3% in 2012.

This is much lower than the 2% growth it predicted for both years in May.

It is also predicting very weak growth in the UK – many economists have already slashed growth for the UK.

In the meantime, the OECD has revised growth for the US (the world’s largest economy) to 1.7% this year, down from an earlier estimate of 2.6%.

The Organisation is urging G20 leaders to act quickly to restore confidence “and to implement appropriate policies to restore longer-term fiscal sustainability.”

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