ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Global Unemployment and Inequality during 1991–2019

Reflections from Secondary Data

The authors are grateful to the unknown referees whose valuable comments and input have improved the quality of the paper.
 

Based on secondary data, the paper discusses the changes in global unemployment and inequality between 1991 and 2019. The analysis reveals that the rate of unemployment and incidence of inequality have either increased or remained stubbornly high in almost all the countries under study. Significantly, the proportion of vulnerable employment and that of working poor has also increased. This, in turn, might explain the low aggregate demand for goods and services in the world and, hence, the persistence of more than a decade-long global recession. Such a scenario may pose a serious challenge for the long-term feasibility of the Sustainable Development Goals 2030 of the United Nations Development Programme and that of the consumption-led development paradigm.

Persistent unemployment, high proportion of working poor, high incidence of vulnerable employment, and increasing inequality across the world have resulted in the concentration of wealth and purchasing power in the hands of a small proportion of the population, which, in turn, has had adverse implications on the global demand for goods and services. This, consequently, has led to a declining labour demand, more lay-offs and higher unemployment, more low-wage and poor-quality employment, and shrinkage in the aggregate purchasing power. The prevalence of high-income inequality has a direct bearing on the distribution of incomes and purchasing power (Lawson and Martin 2018). The limited spending capacity of the United States (US) middle class has been shown to be one of the important consequences of rising inequality in the US (Stiglitz 2015) and a similar scenario may be prevalent in other countries too. In fact, inequality, unemployment, and poverty are indicators of exclusion and deprivation (Nayyar 2019; Sen 2000; World Bank 2001), which, in turn, often have an adverse effect on the purchasing power of a large section of the population.

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Published On : 17th Jan, 2024

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