- The Washington Times - Monday, June 15, 2009

GENEVA | Political leaders from rich and poor nations attending the global jobs-crisis summit that kicks off here Monday will be warned that a recovery in employment may lag many years behind a rebound in economic growth unless more money is pumped into smart job-generating initiatives.

“It’s an event to highlight the significance that in dealing with the crisis you need political leadership that puts employment and social protection on the agenda,” said Juan Somavia, director general of the International Labor Organization (ILO), which is hosting the summit.

World political and labor leaders slated to attend the gathering at the Palais des Nations, the U.N.’s palatial European headquarters, include, among others, French President Nicolas Sarkozy, Brazilian President Luiz Inacio Lula da Silva, Indian Secretary of Labor and Employment Sudha Pillai, and U.S. Labor Secretary Hilda L. Solis.

The ILO chief told reporters Friday that unemployment will significantly increase this year and continue to rise into 2010.

The latest ILO employment study estimated that global unemployment last year reached 189 million, up from 180 million in 2007. The report noted that Western industrialized economies, including the United States, will lose more than 12 million jobs in 2009, or about 35 percent to 40 percent of the global increase in unemployment.

ILO labor economists project that the number of unemployed people worldwide will increase between 31 million and 50 million this year, reaching a total of 220 million to 239 million.

The main goal of the summit, said Mr. Somavia, is to try to place employment creation and social protection “at the center of recovery policies.”

The global labor chief believes that a political commitment on a global job pact “would stimulate the real economy and sustain working families through employment-oriented measures,” and would, as a result, “reduce the time to recovery.”

Mr. Somavia, a Chilean economist and diplomat, noted that about 45 million mainly young men and women are entering the global labor force each year. If this trend continues into 2015, he said, “you need to get about 300 million new jobs.”

But the ILO conceded that its own studies, as well as those by the International Monetary Fund and the World Bank, show that there is a lag time between growth recovery and job recovery. Over decades, that lag time has been between four and five years.

So there is a risk, Mr. Somavia said, that without sufficient economic stimulus, “we have a danger” that this lag could stretch to as long as six to eight years — three years of increased unemployment plus a four-to-five-year lag in the labor market — just to return to precrisis levels of employment.

The ILO chief said one purpose of the conference is to “put in place policies that can reduce the lag time and deal with the unemployment crisis.”

Mr. Somavia argued that many of the resources plowed into the stimulus packages by major economies, including the United States, could be better used if they were redirected into investments in infrastructure, public goods and green jobs.

Raymond Torres, director of the ILO’s International Institute for Labor Studies, told The Washington Times that Germany has created a program to help troubled businesses retain employees to ensure that skills are not lost for about 1 million workers.

The program, which is paid for mostly by employers with help from the government, ensures that valuable skills are not lost during the downturn. Experts point out that it is cheaper for a government to help save a job than to end up paying a laid-off worker unemployment benefits.

Mr. Somavia of the ILO said countries that have been dependent for decades on export-led growth need to rethink their strategy because their trading partners are importing fewer goods.

Stimulating domestic markets, he said, is essential for future growth.

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