ECN | 19 Nov 2015
Despite the vast amount of money printing, record low interest rates (negative in certain parts of the world) and government stimulus, the global economy can’t seem to garner any momentum. And for populations around the world, this isn’t very good for their labor situation.
According to a new Gallup poll, the definite global unemployment rate is 32 percent. This is far higher than the International Labor Organization’s (ILO) measurement of 5.9 percent. When looking at the youth unemployment rate then that number is likely more in the 50 percent mark.
Gallup’s Jon Clifton opines that there is an issue with the way the governments and think-tanks of the world define and measure what a good job is. Clifton adds that unemployment is a term that is “misleading” and it “grossly underestimates the global jobs problem.”
The polling organization reports that much of the unemployed consider themselves to be self-employed, and about three billion people who want a good job but do not have one. Gallup asks how international agencies can define “work” and “self-employed,” and are African farmers or vendors in India really the same as small business owners in any city across the United States.
When looking at the ILO’s figures, Gallup writes:
“That figure by itself suggests there isn’t a global jobs problem. It tells us that, of the more than 3 billion job seekers worldwide, only 200 million are unemployed. Considering that almost half of the world lives on less than $2 a day, that unemployment figure can’t be right.”
The survey institution adds:
“The ILO recommends a broad framework of labor force statistics to national statistics offices worldwide. Most countries collect these data using a survey. These surveys ask people how many hours they worked in the past week and whether it was for an employer or themselves. If they weren’t employed, people are asked whether they are looking for work. The resulting data are the official employment statistics for the country.”
In the end, according to Gallup, the only way to determine a good job or a real job is if it provides at least 30 hours per week with consistent work and a steady paycheck from an employer.
If you were to use this definition then Gallup projects 1.3 billion out of approximately five billion adults have a good job.
“So who are the other 3.7 billion? About 1 billion people are self-employed; about 400 million work part time and do not want full-time work; about 300 million work part time but want full-time work; 250 million are unemployed; and the rest are out of the workforce. Not all of the self-employed are hopelessly unemployed, but we can conservatively estimate that at least half of them are.”