Global Employment Trends 2014
The Numbers: Workers earning less than $1.25 per day, constant dollars*
-
2013 375 million
2012 385 million
2011 406 million
2000 693 million
1991 811 million
*International Labor Organization estimates
What They Mean
The ILO’s Global Employment
Trends 2014 counts 3.14 billion people making the
trek/drive/subway-ride/bus-trip/etc. this morning to the plant/
shop/lab/kitchen/office/construction site/classroom/etc. Using the G.E.T.’s
statistics, we can sort these workers into two groups: first, wealthy and middle
class; second, near-poor and poor.
1. Wealthy and middle-class: This group starts with 485 million workers in rich
countries. Then come 280 million developing-world workers - just under 9 percent - who have reached the ILO’s somewhat expansive
definition of ‘developed-world middle-class.’ (This means that by evening they
will earn $13 or more. For context, an American minimum-wage worker, at $7.25
per hour, gets $58 dollars for a day’s work. The ILO’s $13 floor means an
hourly wage of $1.65, about equivalent to minimum-wage jobs in Serbia,
Malaysia, or Brazil.) The ILO places another 820 million workers in a
‘developing-country middle class’ tier, earning at least $4 but no more than
$13 daily. Altogether, the total comes to about 1.59 billion middle-class
and wealthy earners.
2. Near-poor and poor: The second group includes 839 million workers considered
‘poor’ - further divided into 464 million men and women earning $1.25 to $2
today, and 375 million ‘extremely poor’ workers who are below $1.25 - plus
about 680 million in the “near-poor” category of $2 to $4.
Taken together and over time,
the ILO’s figures show a working world quickly becoming ‘middle class.’
The Global Employment Trendsestimates go back 23 years to 1991. In that
year - as the Cold War faded out, the Internet went live, Congress authorized
negotiations on the North American Free Trade Agreement, Chinese reform
re-launched, and so forth - the world’s 1.3 billion poor and near-poor workers
outnumbered their middle class and wealthy brethren by 1.5 billion to 700
million, or by a margin of two to one. A decade later at the millennium,
the balance was 1.7 billion poor workers to 950 million middle class, or 1.8 to
1. By 2013, the middle-class count had risen to 1.58 billion, against a
poor and near-poor count of 1.52 billion.
Yes, some measurement error is
always possible. Certainly, it is fair to quarrel over the definition of
‘middle class.’ But at least by the ILO’s count and definitions - and for
the first time in world history - fewer than half of the men and women making
their way to work this morning working world are poor.
The future - G.E.T.’s figures
also include a guess about the future to 2018. Over the next four years,
they believe, the count of ‘developed-world’ middle class workers in lower- and
middle-income countries will nearly double to 450 million. The total
count of wealthy, middle-class, and ‘developing-world middle class’ will reach
1.9 billion; meanwhile the count of poor and near-poor workers will drop to 1.4
billion, mainly through a 100-million decline in the count of extremely poor
workers.
The 375 million men and women (and children) in the ILO’s very lowest
category of work - that of “extremely poor” workers earning $1.25 per day or
less - are the people on the edge. With two parents working at this rate in a
five-person family, today’s day’s work will buy $1.50 worth of food, $$0.75 for
shelter, and $0.25 for travel to worksites, with nothing left over. These
people make up about 12 percent of the world’s
workers. Who are they?
1. Most are Asian: 155 million of the world’s very poor workers are on farms, quarries,
construction sites, maid service, and similar jobs in South Asia (i.e. India,
Pakistan, Bangladesh, Nepal, Afghanistan, and Sri Lanka, plus the small states
Bhutan and Maldives). Another 43 million are in China and Southeast Asia.
Sub-Saharan Africa counts most of the rest - 130 million - and has the highest
rate of very low-income workers at 40 percent.
Elsewhere, very low-wage labor is rare: Latin America
and the Caribbean have 8.5 million extremely workers, the Middle East 2.5
million, and the rest of the world 0.9 million.
2. Most are rural: While Global Employment Trends doesn’t match workers by sector
(agriculture/industrial/services) and income, the highest regional rates of
very low-income work match the highest rates of rural employment, and
contrariwise the lowest counts of very poor workers have the smallest share of
rural employment: 61 percent of workers in
sub-Saharan Africa are rural, 47 percent in South
Asia, 30 percent in ASEAN, 20 percent
in Latin America and the Caribbean, 15 percent in the
Middle East, and 4 percent in rich countries.
This suggests that much of the world’s drop in poverty results from the
migration of Chinese, Indonesian, and Filipino rural people from farms to
cities where wages are higher.
3. They are getting fewer: As the middle class has grown, the ranks of the
very poor have steadily and rapidly diminished. The ILO’s estimates have
dropped from 811 million extremely poor workers in 1991, to 675 million in
2001, 406 million in 2011, and 375 million in 2013. Regionally since
2000, counts of very poor workers have dropped from 315 million to 78 million
in China and Southeast Asia; from16 million to 8.5 million in Latin America,
from 3.2 million to 2.2 million in the Middle East. Last year’s
decline was slower but down from 385 million to 375 million. (4 million
fewer in China, 6 million fewer in South Asia, only small changes
elsewhere.) Even this slowing rate of change, though, means that 27,000
men and women were escaping deep poverty every day last year.
Looking ahead to 2018, the ILO
forecasts continuing drops - from 155 million to 112 million; from 130 million
to 119 million in sub-Saharan Africa; a 60-percent cut in very low-income work
in East Asia, bringing the end of absolute poverty in sight; a 33 percent drop in Southeast Asia, and a 20 percent drop in the Western Hemisphere.
A middle-class world, but not
everywhere -
Worldwide, extremely poor
workers are 12 percent of the total. By
country, the ILO’s maps show Liberia with the highest share at 82%, followed by
Madagascar at 76%, then Zambia and the Central African Republic at 65%. A
sampling of fifteen other countries finds a global pay-spectrum as follows:
Liberia 82%
Madagascar 76%
Zambia 65%
Afghanistan 51%
Nigeria 45%
Haiti 33%
India 25%
Ethiopia 22%
Myanmar 19%
Indonesia 14%
Honduras 11%
China 5%
South Africa 5%
Brazil 2%
Egypt 1%
Morocco 0.9%
Mexico 0.3%
Thailand 0.2%
Malaysia 0.1%
Since 1991, four of these
countries - China, Mexico, Morocco, and Thailand - have cut the very low-wage
shares of work by 90 percent or more.