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Global Unemployment Outlook Gloomy, ILO Report Says

The International Labor Organization (ILO) on Tuesday warned that unemployment across the globe is set to rise further in the next five years as economies are not generating enough job opportunities.

In the "Global Employment Trends 2012" report, the agency said that the world faces an "urgent challenge" of creating 600 million productive jobs over the next decade in order to generate sustainable growth and maintain social cohesion.

"After three years of continuous crisis conditions in global labor markets and against the prospect of a further deterioration of economic activity, there is a backlog of global unemployment of 200 million," the report said.

It added that globally some 1.1 billion people were either unemployed or living in poverty.

According to the baseline projection of the annual report, an additional 3 million will be left unemployed in 2012. By 2016, the figure will rise to 206 million. If global growth rates fall below 2 percent, then unemployment would rise to 204 million in 2012.

In a more benign scenario, assuming a quick resolution of the euro debt crisis, global unemployment would be around 1 million lower in 2012, ILO said.

Moreover, over 400 million new jobs will be needed over the next decade to absorb the estimated 40 million growth of the labor force each year.

Young people continued to be among the hardest hit by the jobs crisis and also, there is little hope for a substantial improvement in their near-term employment prospects, the labor agency said.

Youth unemployment increased by more than 4 million from 2007 to 74.8 million in 2011. Also, the current global youth unemployment rate of 12.7 percent remained a full percentage point above the pre-crisis level.

The report urged policy makers to act "decisively" and "in a coordinated fashion" to reduce the fear and uncertainty that is hindering private investment so that the private sector can restart the main engine of global job creation.

It warned that in times of faltering demand, further stimulus is important and this can be done in a way that does not put the sustainability of public finances at risk.

The fact that economies are not generating enough employment is reflected in the employment-to-population ratio, which suffered the largest decline on record between 2007 and 2010, it noted.

Furthermore, the report reveals that here are nearly 29 million fewer people in the labor force now than would be expected based on pre-crisis trends.

by RTTNews Staff Writer

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