G20 Labour and Employment ministers' meeting - 18-19 July 2013, Moscow

ILO Director-General's address to G20 Labour and Employment Ministers

Statement | Moscow | 19 July 2013
Minister Topilin,
Honourable Ministers,

Thank you for the opportunity to address this meeting of G20 Ministers of Labour and Employment. I would especially like to thank the Russian Presidency for the excellent arrangements made in order for this meeting to undertake its work successfully.

As much as been said already, I will direct my comments succinctly to the subject matter of this meeting. Colleagues, the Russian Presidency rightly placed growth and jobs high on the agenda of the G20. Your discussions over these two days show that that priority is shared by all. It has been striking to see the commitment expressed by Ministers here to do more to tackle the crisis of employment.

And similar thoughts will be in the minds of G20 Leaders when they meet in September in St. Petersburg. When they emerge from their meetings, public opinion will be looking to them for strong action in these areas. The question is how successfully our efforts here in Moscow can make a concrete and substantial contribution to their actions.

Every G20 country faces a jobs challenge; they differ across countries, but in every G20 country they are massive. I am not going to take you through all the substance of the labour market statistical outlook before you prepared jointly by the ILO and the OECD, which has been commented on by others, but it describes a worrying situation. A total of 93 million persons are unemployed across G20 countries. The latest available employment rate is still below the pre-crisis level in 13 countries. The youth employment rate is higher than pre-crisis levels in only 3 countries. Quality formal employment is lagging behind the increase in the labour force and informality is a major problem as well.

Against this grim backdrop, the IMF has just reduced downwards once more its forecast for global growth for 2013 and 2014; the situation is going to get worse before it gets better.

Given these circumstances, one can legitimately ask if enough has been attempted by the G20 countries to create the “durable recovery that creates the good jobs our people need” that G20 Leaders called for in Pittsburgh in September 2009 and at every Summit since.

In this context, the ILO/OECD report prepared at the request of the Task Force on Employment summarizing various actions taken by G20 countries provides elements of an answer. I won’t take you through all the details, but here are some of the highlights:

  • Infrastructure investment has increased, leading to immediate job creation;
  •   employment subsidies, particularly for young people, have been introduced;
  • the European Union has adopted an ambitious programme on youth employment guarantees;
  • many countries have promoted reforms in vocational training and apprenticeships, a theme you highlighted when you met in Guadalajara under the Mexican Presidency;
  • public employment programmes have made important contributions to household incomes and poverty alleviation in a number of countries;
  • public employment services have been strengthened in others;
  • and basic social protection coverage, in line with the ILO’s concept of a social protection floor, has also been significantly expanded in important parts of the G20.

It seems to me, then, that most countries have implemented measures to improve labour market outcomes. And there is no reason to underestimate their importance and results. And yet, we have to recognize that despite them, there are still far too few adequate jobs being created in the G20 or indeed in the global economy as a whole.

This leads me to step back a moment and recall that the G20 initially gained its reputation, credibility and protagonism in 2009 through bold and decisive collective action. It did little less than save the global economy from collapse, by recognizing that coordinated economic action was needed and by finding the political will to take that action.

Are we not at such a moment now, where a similar scale of ambition is needed again, none the less so because the crisis is about the world of work more than the world of finance?

A major objective of the G20 is to steer the global economy towards balance, particularly between current account surplus and deficit countries, and between exports and domestic demand. In order to achieve global rebalancing based on robust growth, we need employment, labour market and social protection policies that increase household incomes and increase domestic demand. And more effort is needed and more coordination is needed, including between Employment Ministers and not only you but with your colleagues in Finance Ministries as well.

There are several ways in which G20 countries can move forward.

And the role of the social partners can be instructive and important in shaping policies to national and local circumstances. We heard yesterday from the B20 and the L20 of the agreement on Key Principles of Quality Apprenticeships they reached in June. This provides a way forward to further cooperation of this sort.

Indeed facilitating the exchange of experience was the original role assigned to the Task Force on Employment in the first year under the Mexican G20 presidency, on design of youth employment programmes. It seems to me there is much more the Task Force could do in the future.

Ministers, one area where does seem to be scope for additional action in almost all G20 countries is improving the employment conditions of the bottom half of the labour force, in terms of earnings and in terms of reducing the level of insecurity and risk. This would be good for the overall economies of G20 countries by strengthening aggregate demand and it would help to reduce inequality and improve social cohesion.

What can be done to improve jobs for the bottom half of the labour force? There is scope in many countries to improve the coverage and levels of minimum wages. Collective bargaining does need to be strengthened in many countries, and this can address wage dispersion and better restore the linkage between productivity and wages. Basic income guarantees can help lower income households cope with periods of unemployment and allow them to invest in their own skills and training.


Over the last four years of G20 Employment Ministers’ meetings you have emphasized the benefits from greater cooperation between countries around employment, labour markets and social protection. Given our circumstances today it could easily be agreed that more such cooperation is in order, and that your countries stand to gain when you intensify exchanges and coordination of policies.

This has implications for your recommendations in two regards.

Firstly, the success of labour market policies rests on good design, directed to the specific challenges that you face. It would therefore be beneficial for the G20 to explore ways to intensify the exchange of labour market experiences between countries. The monitoring exercise the ILO and the OECD have undertaken for this meeting has yielded, as many of you have said, important insights into the most effective policies for job creation. That suggests that such work could usefully be maintained and deepened under future G20 Presidencies.

The second point is that if implemented in a coordinated manner, these measures would contribute more to growth of global aggregate demand, which has been an agreed priority of G20 Leaders and G20 Finance Ministers. The measures that I have been referring to constitute relevant and appropriate aspects of strong, sustainable and balanced growth, the overall goal, you will recall, of the G20.

It is in this context that the important meeting you will hold with G20 Finance Ministers this afternoon holds enormous potential to bring together the different parts of your governments that share responsibility for growth and for employment. The joint statement to be adopted can address a strong and clear call for greater policy coordination and integration within countries and between G20 countries. It can be an important roadmap for the kinds of policies that can make a real difference to your citizens. It can also point the way to see how all policy levers can be used to attain common goals. But that, evidently, depends on the follow-up, the practical ways in which the G20 Finance and Employment Ministries can advance this work.

Perhaps in the coming weeks until the Leaders’ Summit, there can be advantage in considering ways to better link and coordinate the work of the Employment Task Force with the Framework Working Group that is charged with tracking the macroeconomic policies of the G20.

In any case, whatever you think, the ILO can also do more to help — and I certainly would not presume to speak for the World Bank and OECD, but I suspect they would feel the same way - by way of analysis of policy designs, by comparative analysis, and by developing new proposals. If you ask us for more in these areas, we will certainly do our best to respond positively.

Ministers, let me conclude by saying that the experience of countries at different stages of development and over time suggests that high employment levels and inclusive growth can be achieved through a well-designed combination of supportive macro-economic policies and employment, labour market and social protection policies. And the employment situation in every G20 country could be improved by a more favourable environment in the G20 as a whole.

Given that circumstance, we have enormous responsibility to deliver the economic and social policies which can achieve progress toward these goals and thus respond to the expectations of the citizens of the G20.

Thank you.