ADB book says half a billion Asians unemployed or underemployed
28 Apr '06
3 min read
Second, many new jobs being generated outside of agriculture are also in the informal sector. The book notes that this is a break from the past when economic growth and expansion of employment in the formal sector went together.
India's experience illustrates the point. Despite average annual growth in GDP per capita close to 5 percent between 1993 and 1999, the share of the informal sector in total nonagricultural employment increased from 80.5 percent to 83.2 percent.
The informal sector also appears to be expanding in fast-growing transition economies such as the PRC and Viet Nam.
The interplay between the forces of globalization, technological change, and competition is an important factor behind slow job creation, the book notes.
While positive in many ways, these forces have enabled and compelled firms in developing countries to adopt productivity-enhancing technologies that tend to be increasingly capital-intensive.
This technological progress has made it possible for firms to expand output with smaller increases in employment.
The book discusses the key elements of an overall policy package to address Asia's employment challenge and points out that while labor laws could be improved in some cases, they are not the main drag on job creation. More flexible labor laws alone would not spark a surge in new jobs. Among the key issues a successful policy package would address are:
Labor Markets in Asia consists of five chapters examining cross-cutting issues and five country studies.
marketing@alchempro.com
