Today's date:
Winter 2001

A Global Deficit of Decent Work

Juan Somavia is director-general of the International Labor Organization. The ILO was awarded the Nobel Peace Prize in 1969.

Geneva - For all the stunning achievements of the knowledge economy to date, its real promise, ultimately, will be measured in terms of responding to human needs. It will be assessed for its ability to raise the standard of living and its capacity to build more opportunities for men and women to achieve well-being for themselves and their families. Will the knowledge economy help to expand justice and equity for all?
The fact is that too many people and communities have been excluded from the gains of the global economy by lack of knowledge, assets or opportunities. The knowledge economy is growing alongside an informal (including the underground) economy. Using our best predictions and forecasts of growth, we won't have enough jobs to meet the livelihood needs of people in the next decade. Globally, there is a deficit of decent work.

Mesmerized or paralyzed by the wonders of technology, we cannot remain oblivious to the fact that huge gaps between the haves and have-nots still exist: more than 3,000 people die every day because of work-related accidents and diseases, 75 percent of the world's workers have no access to unemployment benefits and half the world's population exists on less than $2 a day. Inequalities are widening and insecurities are growing, too.

Parents fear for the future of their children even when they are equipped with a good education. Employment has become more precarious under the competitive pressures of globalization, and jobs lost are not easily replaced. Managers in industrialized countries are uncertain about the future of their businesses. Many people feel a growing dislocation from those in power and from the decisions and processes that fundamentally affect their lives. They often feel the distance and disconnect of governments, large corporations and international organizations with their most urgent needs and fears.

A strategic instrument for giving the global economy social legitimacy is to accelerate the rate at which decent work is created. Decent work is the first step out of poverty and an important stride toward social integration. It is about enabling women and men to meet the needs of their families in safety and health, to educate their children and to offer them income security after retirement. Decent work also makes good economic sense because it is the foundation of long-term sustainable growth.

Promoting decent work in the global economy is central to the business of the International Labor Organization. For more than 80 years, the ILO has served as the world's only multilateral institution jointly governed by employers, workers and governments. Our job is to understand each revolution in production-how it creates new patterns of work, new rules, new winners, new losers, new institutions-and provide the negotiating space to come up with society's "rudder," with the most fair and just way forward and by balancing the interests of all the stakeholders in the world of work. In concrete terms, we do this by addressing the gaps in employment, in workers' rights, in social protection and social dialogue.

Take the employment gap: One billion people are currently unemployed or underemployed. It is a major fault line of the global economy. Unemployment is not just a statistic. Work is probably the most important single element that affects the life of individual human beings. It is critical to one's identity, dignity and future. It is the principal means by which people connect to their communities and to the wider economic system. Work is also the primary route out of poverty.

In the new global economy, the growth and enterprise creation needed to absorb this huge employment gap cannot depend on national policies alone. Public and private-sector policies and investments must be directed to generate more jobs on a global scale. Many aspects of the global economy could be reoriented to do this. The knowledge economy is the most obvious, as information and communications technologies open up digital opportunities. But for most people in developing countries today the knowledge economy is on the other side of the digital divide and the informal economy is the reality.

BRIDGES BETWEEN KNOWLEDGE AND INFORMAL ECONOMIES | What we need to do is build bridges between the knowledge economy and the informal economy. Small firms are the key as they are today's main source of employment creation and growth. Initiatives that support small and medium-sized enterprise growth-with capital, skills and market access-will help to bridge the two. At the same time, the firms which grow and create jobs are increasingly those which build their success on the knowledge of their workers. Accelerated investment in education systems, skills and lifelong learning are therefore crucial. In the knowledge economy, these are the prime determinants of success or failure.

The knowledge economy has not removed gender equality as an important political and economic priority. Although new job opportunities have emerged for women-especially in tele-working-deliberate efforts are needed to weaken stereotypes, oppose discrimination and bring gender issues into the mainstream of public and private policy-making. Otherwise, women will continue to suffer the double burden of family responsibilities and work.

The knowledge economy requires new forms of regulation for the labor market which support innovation and change and simultaneously defend rights at work and access. In today's more volatile labor market, we need fair ways to combine flexibility with security. If jobs are lost more easily, faster pathways back to employment are needed.

Beyond the employment gap is a rights gap that needs to be bridged at the same time. Work takes many forms. People earn a living in the factory, farm, home or street. They can be self-employed, casual or informal workers, paid or unpaid, or home workers-mostly women-who rarely appear in the statistics. Whatever the situation, every person who works has rights.

These basic rights were given worldwide recognition at the Social Summit in Copenhagen in 1995 and are set out clearly in the ILO's Declaration on Fundamental Principles and Rights at Work. They include freedom of association and collective bargaining, and freedom from forced labor, child labor and discrimination. Workers' rights aren't fringe benefits to be gained at a later date, or when the economic conditions are convenient; they constitute the "social žoor" of the global economy below which no person should fall. These rights are valid in all countries regardless of their stage of development, from the sweatshops and "inner cities" of the North, to the shantytowns and export-processing zones of the South. Crucial among these rights is that of "voice"-the right to organize and be heard, to be able to defend one's interests and to bargain collectively. It is the foundation upon which other rights can be fully exercised.

In the knowledge economy, new types of organization are needed because tele-workers are unable to organize in the same way as workers on the factory floor, and networked or virtual firms do not provide a stable environment for collective bargaining. The global nature of the knowledge economy has made the question of organization and social protection a global one. New global trade union groupings, such as Union Network International, are emerging. Earlier this year, UNI and the Spanish multinational Telefonica signed a remarkable agreement which covers not only basic rights worldwide, but also questions of skills and access to telecommunications. Innovative schemes that offer social protection on a similar scale are now needed.

Contrary to conventional wisdom, workers' rights are not an obstacle to growth. they are essential for growth for they deliver precisely what people ask for in their daily lives-work with security and dignity. Workers' rights are good for productivity, too. And where conflicts of interest emerge, institutional frameworks for dialogue and participation can be designed to bring out the positive synergies. In fact, decent work based on transparent and free dialogue among governments, employers and workers is an indispensable means of ensuring conflict resolution, social equity and legitimacy in the world of work.

As Vaclav Havel reminded us during the annual meeting of the Bretton Woods institutions in Prague recently, we cannot have sustained globalization without caring about values. The challenge we face is to guide policy-making with a moral compass, and to ensure that decisions are based on universally shared principles of equity and equality, without losing sight of the need for sustained economic growth and rising productivity. It is about using policy instruments to promote values and dignity. It is about linking social justice and economic progress in practical ways to bridge the divide between those who live on the cutting edge of the information age and those who live on the bare edge of survival.

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