Despite signs of economic growth recovery in some parts of the world, the global labour market remains in an alarming condition and no signs of its recovery can be expected in the near future. That is the conclusion of the International Labour Organisation (ILO) annual report entitled World of Work Report 2012: Better Jobs for a Better Economy. The report also states that - compared to the period before the economic crisis - the world is still missing about 50 million jobs and a new, even more problematic phase of the global crisis is ahead of us. The causes of this situation are as follows:
1. Most governments, especially in the advanced economies, began to shift their priorities towards a combination of fiscal austerity and tough labour market reforms. That has a devastating impact on labour markets in general and in particular on job creation.
2. Most job seekers in the advanced economies are demoralized and losing their skills, which negatively affects their possibilities to get a job. Moreover, small firms have limited access to credit, which undermines investments and prevents job creation. Therefore, especially Europe cannot expect recovery of the labour market until 2016.
3. Most new jobs in the advanced economies are uncertain. Nonstandard forms of employment are therefore on the rise in 26 of the 50 countries surveyed.
4. The social climate aggravated in many countries, which could bring other social unrest. Most of the risk is increasing in sub-Saharan Africa, the Middle East and North America.
Fiscal savings along with the deregulation of labour markets do not provide any short-term prospects for job growth according to the report. There is no direct link between labour markets reforms and job growth. Especially in Europe, some reforms have strengthen the instability of jobs and further deepen social inequality while also failing in the issue of creating new jobs. If, however, a convenient combination of taxation and higher spending on public investments and social benefits is introduced, up to 2 million jobs could arise in the advanced economies during the year.
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