World unemployment rate on the rise

A rising middle class in emerging economies can't make up for job losses in the developed world.
Written by Tyler Falk, Contributor

Despite two consecutive years of falling global unemployment, the number of jobless is once again on the rise. And projections for future years aren't looking much better.

According to a new report from the International Labour Organization, the global unemployment rate in 2012 rose to 5.9 percent of the workforce, increasing by 4.2 million people. Over 197 million people are now considered unemployed.

“An uncertain economic outlook, and the inadequacy of policy to counter this, has weakened aggregate demand, holding back investment and hiring,” said ILO Director-General Guy Ryder. “This has prolonged the labour market slump in many countries, lowering job creation and increasing unemployment duration even in some countries that previously had low unemployment and dynamic labour markets.”

Much of the increase can be blamed on rising unemployment in advanced economies.

The job market is particularly bad for workers under 24, as 12.6 percent are unemployed. And while the situation is expected to improve for young people in advanced economies, it's only projected to worsen in emerging economies in Eastern Europe, East and Southeast Asia and the Middle East.

But, overall, a rising middle class in emerging economies should help soften the unemployment blow but not enough to prevent rising unemployment in the coming years.

So what can governments do?

“[M]any of the new jobs require skills that jobseekers do not have,” Ryder added. “Governments should step up efforts to support skills and retraining activities in order to address such mismatches which particularly affect young people.”

The report also noted that 39 million people left the labor market last year.

Read the full report here.

This post was originally published on Smartplanet.com

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