ILO report finds global job quality stagnating despite stable unemployment
Nearly 300 million workers live in extreme poverty as progress toward decent work stalls, agency warns
GENEVA — Global unemployment remains stable at 4.9 percent, but progress toward decent work has ground to a halt, leaving hundreds of millions of workers trapped in poverty and informal employment, according to a new flagship report from the International Labour Organization.
The “Employment and Social Trends 2026” report, released January 14, projects that 186 million people will be unemployed this year—a figure that has remained largely unchanged since 2023. But beneath this surface stability, the ILO warns of deepening structural problems that threaten social justice worldwide .
“Resilient growth and stable unemployment figures should not distract us from the deeper reality: hundreds of millions of workers remain trapped in poverty, informality, and exclusion,” ILO Director-General Gilbert F. Houngbo said in a statement accompanying the report’s release .
Job quality under strain
The report paints a stark picture of deteriorating work quality across much of the world. Nearly 300 million workers continue to live in extreme poverty, earning less than $3 per day—a threshold that leaves them unable to meet basic needs despite holding jobs .
Informal employment, which offers little or no social protection, job security, or legal rights, is expanding. The ILO estimates that 2.1 billion workers—approximately 57.7 percent of the global workforce—will be in informal jobs by the end of 2026 . In sub-Saharan Africa, nearly nine in 10 workers are informally employed .
The lack of progress is most acute in low-income countries, where workers with the poorest employment conditions are falling even further behind. The report attributes this stagnation to a slowdown in the transformation of economies toward higher-value industries and services—a key driver of job quality improvements in previous decades .
“The improvements have stalled,” said Stefan Kühn, senior economist in the ILO’s Macroeconomic Policy and Labour Market Trends unit and lead author of the report. “A major reason is that the transformation of economies toward more productive sectors with better working conditions has slowed down markedly over the past decade” .
Youth face daunting prospects
Young people continue to bear the heaviest burden in global labour markets. Youth unemployment climbed to 12.4 percent in 2025, and approximately 260 million young people are now classified as NEET—not in employment, education, or training .
In low-income countries, the NEET rate stands at a “daunting” 27.9 percent, according to the report . This means more than one in four young people in the world’s poorest nations are neither gaining work experience nor acquiring skills through education or training, potentially trapping them in long-term economic exclusion.
The situation is not confined to developing economies. The ILO warns that artificial intelligence and automation could exacerbate challenges for educated youth in high-income countries seeking their first jobs in high-skill occupations .
“While the full impact of AI on youth employment remains uncertain, its potential magnitude warrants close monitoring,” the report notes .
Kühn explained that young people have historically faced higher unemployment due to limited experience, but the current scale of disengagement is unprecedented. “What we are very concerned about is not only the unemployment rate but the share of youth not in employment, education, and training, which stands at one in five youth. That’s 260 million young people who are not gaining valuable experience that they need to succeed later in the labour market” .
Gender inequalities entrenched
Women remain significantly disadvantaged in global labour markets, with progress toward gender equality at work having stalled, the report finds .
Women account for just two-fifths of global employment and are 24 percent less likely than men to participate in the labour force . These gaps are driven largely by social norms and stereotypes that assign women primary responsibility for unpaid care work and limit their access to paid employment .
In the Arab States, the disparity is particularly pronounced. In Gulf Cooperation Council economies—Saudi Arabia, Kuwait, the UAE, Qatar, Bahrain, and Oman—women’s labour force participation in 2025 was 39.5 percent, less than half the men’s rate of 86.7 percent. In non-GCC Arab states, the gap widens further: 66.1 percent for men compared to just 10.8 percent for women .
“Gender gaps are a global phenomenon,” Kühn said. “We estimate that only two out of five workers are women, even though they make up half of the population” .
Demographic divides deepen
The report highlights how demographic trends are creating divergent labour market realities across income groups .
In high-income countries, ageing populations are slowing labour force growth, with fewer working-age people available to enter or remain in employment. Employment growth in upper-middle-income countries is projected at just 0.5 percent in 2026 .
By contrast, low-income countries face the opposite challenge: rapid population growth that is not being matched by productive job creation. Employment growth in low-income countries is projected at 3.1 percent, but these jobs are often of poor quality, with high rates of informality and working poverty .
Without sufficient productive job opportunities, the ILO warns, poorer countries risk squandering their demographic dividend—the economic growth potential that can arise when a country’s working-age population is larger than its dependent population .
Weak labour productivity growth in low-income countries is also deepening geographic inequalities, hindering progress toward decent work, and slowing the convergence of living standards with advanced economies .
Trade uncertainty weighs on wages
Global trade disruptions are adding significant uncertainty to labour markets, the report finds. Uncertainty about trade rules and supply chain bottlenecks are cutting into workers’ wages, particularly in Southeast Asia, Southern Asia, and Europe .
Marva Corley, a senior economist and trade expert at the ILO, explained that trade policy uncertainty—including restrictions, geopolitical tensions, and supply chain disruptions—makes it harder for firms to plan, invest, and hire .
“Our analysis shows that when trade policy uncertainty rises, even moderately, it can put downward pressure on wages across the board,” Corley said. “The effects are really strongest in those economies with deep integration in supply chains. Think about, for example, Southeast Asia, Southern Asia, but also Europe and Central Asia, where real changes in terms of wages could fall between say almost half a percent per year” .
Despite these pressures, trade remains a major source of employment, supporting 465 million workers worldwide—more than half of them in Asia and the Pacific . The report emphasizes that trade can be a powerful driver of decent work, particularly in low- and middle-income countries, where export-linked sectors often provide better pay, lower informality, and more opportunities for women and youth .
The composition of trade is also shifting. Digitally delivered services now account for 14.5 percent of global exports, and nearly half of all trade-related jobs are in market services—a significant increase from 35.9 percent in 1995 . While trade among developing economies has expanded, many African and South American countries still depend heavily on markets outside their regions for most trade-related jobs .
Regional variations
The report provides detailed regional analysis showing widely varying labour market conditions .
In sub-Saharan Africa, the number of decent jobs is not keeping pace with rapid population growth. Working poverty is widespread, with over half of workers living below the moderate poverty threshold .
Latin America and the Caribbean saw employment increase by 4.4 million between 2024 and 2025, yet 51.1 percent of all employment remains informal. Youth unemployment in the region stands at 11.9 percent—nearly three times the adult rate .
In North America, employment growth is slowing and job vacancies are declining, with unemployment rates expected to increase in the medium term in both Canada and the United States .
Asia and the Pacific maintains a regional unemployment rate of 4.1 percent, down from 5.1 percent a decade ago. Manufacturing remains significant at 16.1 percent of total employment, reaching 20 percent in Eastern Asia. However, youth employment challenges persist, notably in China, where urban youth unemployment reached 17.8 percent in mid-2025 .
In Europe and Central Asia, the unemployment rate remains stable at 5.5 percent, but informality varies widely—from 3.6 percent in Northern, Southern, and Western Europe to 31.5 percent in Central and Western Asia. Ageing populations pose long-term risks, with the old-age dependency ratio projected to rise significantly by 2050 .
Coordinated action urged
ILO Director-General Houngbo called for coordinated action and stronger institutions to advance decent work and social justice, particularly in poorer economies that risk being left behind as global supply chains and digital trade expand .
“Unless governments, employers, and workers act together to harness technology responsibly and expand quality job opportunities for women and youth—through coherent and coordinated institutional responses—decent work deficits will persist and social cohesion will be at risk,” Houngbo said .
The report offers several key recommendations :
- Implement productivity-enhancing policies through investment in skills, education, and infrastructure
- Address gender and youth gaps by tackling barriers to participation and responsibly harnessing technology
- Strengthen trade and decent work outcomes so all regions benefit from global flows
- Mitigate risks from debt, artificial intelligence, and trade uncertainty through coordinated global and domestic policies
Conclusion
The ILO’s “Employment and Social Trends 2026” report presents a world of work characterized by a troubling paradox: stable unemployment figures coexist with deteriorating job quality for hundreds of millions of workers.
While macroeconomic resilience has kept people in jobs, it has not delivered the kind of employment that provides security, dignity, and an escape from poverty. Working poverty, informality, and exclusion remain entrenched, with young people, women, and those in low-income countries facing the greatest disadvantages.
The convergence of technological change, demographic shifts, and trade uncertainty threatens to deepen these divides unless governments, employers, and workers act together to ensure that stable labour markets translate into decent work for all.
With inputs from
1 ILO: Global job quality stagnates despite resilient growth
2 ILO Voices: Global employment in 2026: A fragile stability (podcast)
3 UN News: Global employment stable but decent jobs in short supply
4 UN Geneva: ILO projects global unemployment to remain stable at 4.9% in 2026
5 ILO: Employment and Social Trends 2026 (Flagship Report)
6 The Sun Nigeria: Global job quality stagnates despite resilient growth – ILO
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