The global unemployment rate will rise slightly in 2024, according to the International Labor Organization (ILO), which is concerned about stagnant productivity, worsening inequality and inflation eating away at disposable income.

The global unemployment rate, from 5.3% in 2022, fell to 5.1% in 2023, but in 2024 two million additional workers are expected to look for work, increasing the rate to 5.2%, the ILO estimated in its report on global employment trends and the social outlook for 2024.

The UN agency recalls that the economic recovery after the Covid-19 pandemic has slowed against a background of geopolitical tensions and persistent inflation that has led to an increase in interest rates by central banks.

Global growth in 2023 was still slightly higher than forecast and labor markets showed unexpected resilience, the ILO said.

But real wages fell in the majority of Group of 20 (G20) countries, as wage increases did not keep pace with inflation, the agency pointed out.

Disposable incomes have fallen in the majority of G20 countries and, in general, the erosion of living standards due to inflation “is not expected to recover quickly”, he said.

Her report assesses the latest labor market trends, including unemployment, job creation, labor force participation and working hours, and links them to their social outcomes.

The report finds that some data, mainly on growth and unemployment, are “encouraging”, said ILO Director General Gilbert Ungbo.

But “a more in-depth analysis reveals that labor market imbalances are deepening,” he added.

“It is starting to look like these imbalances are not just related to the recovery from the pandemic but are structural,” he said.

The report, he said, found that only China, Russia and Mexico “benefited from positive real wage growth in 2023”. The latter decreased in the rest of the G20 countries. Brazil (6.9%), Italy (5%) and Indonesia (3.5%) recorded the largest declines.

“The workforce problems it identifies are a threat to individual livelihoods as well as businesses, and we should attack them effectively and quickly,” the ILO director-general added.

“Falling living standards and low productivity combined with persistent inflation are creating conditions for greater inequality and undermining efforts to achieve social justice,” Ugbo said, adding that “without greater social justice, we will never have a sustainable recovery”.