In Asia-Pacific. two out of three workers employed in the informal sector
A report by ESCAP shows that employment has not followed GPD growth in the last 15 years. The number of working poor is also on the rise. In Asia, vulnerable workers are at risk of poverty due to high medical bills. The aging of the population is the top concern: Asia and Oceania will have a billion people over 65 by 2050.
Milan (AsiaNews) – In Asia, the “workforce is insufficiently productive, healthy and protected”, this according to a report released yesterday by the Economic and Social Commission for Asia and the Pacific (ESCAP).
Titled The Workforce We Need. Social Outlook for Asia and the Pacific, the study notes that the lack of qualified workers is due to the growth of informal work, which involves two workers out of three (68 per cent), for some 1.4 billion people, 600 million in the agricultural sector.
Overall, GDP growth in Asia in the last 15 years has not been matched by a commensurate rise in employment, so much so that some countries lost jobs.
Most of this "jobless growth" has occurred in South Asia, where millions of workers are forced to accept casual jobs characterised by the lack of contracts, low wages, irregular working hours, and dangerous working conditions.
In the region, informal employment rose in 14 of the 19 countries for which data are available with some 20 million casual jobs created between 2010 and 2021, growing even faster than total employment in some countries, like Afghanistan, Laos, North Korea, Nepal, and Papua New Guinea.
The report points out that at present, 100 per cent of the population enjoys at least one social coverage plan in Mongolia, Kazakhstan, Australia, New Zealand and Singapore alone, followed by Japan (98 per cent) and Georgia (97 per cent) (see Image 1); however, one Asian worker in two has no kind of social protection and is thus “highly vulnerable to systemic shocks”.
The vulnerability of the workforce undermines its productivity. Inaccessibility to healthcare boosts absenteeism due to illness, increasing poverty and reducing labour productivity, which in Asia is below the global average.
Workers' health status is directly linked to a country’s labour productivity and development: workers in low- and middle-income countries can expect to die 13 years earlier than those in high-income countries, while infant mortality rates in Asia are 10 times higher (see Image 2).
Healthcare costs are so high that millions of families are forced into poverty, a percentage that reached 16 per cent in 2017, the highest in the world.
Another consequence of the increase in informal and precarious work is that half of Asian workers (3.2 billion individuals, more than half of the world’s workforce) are working poor or nearly so, earning less than US$ 5.50 a day.
At least 158 million people live on US$ 3.2 a day (moderate poverty), while 85 million survive on US$ 1.9 a day (extreme poverty).
The most significant increases in working poor were reported in Papua New Guinea, Solomon Islands, East Timor, Cambodia, Laos and India. (See Image 3).
Even before the pandemic and the war in Ukraine, more than half of the continent's workers did not have a regular income for all 12 months of the year, more than a quarter did not have enough food, and a third lacked health protection to continue working. All this translates into loss of physical and human capital and workforce.
According to ESCAP, three future trends could further worsen the conditions of poor and precarious workers by further increasing inequalities, namely climate change, digitalisation, and an aging population.
In the absence of adaptive policies, natural disasters mainly affect small businesses. If current trends continue, ESCAP expects a third of Asian workers to be at high risk, as eight of the world's 10 most vulnerable countries to climate change are located in Asia.
Likewise, digitalisation could leave behind a large part of the population. In Asia-Pacific, less than two thirds of the population has access to the Internet, compared to 90 per cent average in developed countries.
On the other hand, the number of seniors (65 and older) jumped from 171 million in 1990 to 445 million in 2021 and is expected to increase again by 2050, above a billion.
As a result, the median age of the entire population will go from 32.5 years in 2020 to 40.3 in 2050 with a similar trajectory for the workforce. Thus, in the near future, a shrinking workforce will have to support an expanding senior population.
For ESCAP, “It therefore becomes increasingly important to expand the range of decent employment opportunities for older workers and support them to remain productive and in full health through a healthcare system that meets the needs of older persons.”