| Total labor force | 3.70 billion |
| Employed | 3.51 billion |
| Working for wages and salaries | 1,780 million |
| “Self-employed”* | 1,625 million |
| “Formal sector” workers with wage, inspection, & other rules: | 1,660 million |
| “Informal” sector workers without these protections: | 2,030 million |
* Estimates from International Labour Organization, World Employment and Social Outlook 2024.
* The ILO’s term “self-employed” includes business owners, but also includes “own-account” workers such as day laborers, and “contributing family workers” working in small family businesses or farms without pay. The ILO views these two latter groups as comprised of workers who are “least likely to have formal work arrangements, [and] least likely to have social protection and safety nets to guard against economic shocks.”
The International Labour Organization’s “World Employment and Social Outlook 2024,” out last January, says the world’s workforce has grown by 26 million this year and now totals 3.70 billion people. Subtracting the 191 million people currently unemployed, this means 3.51 billion people go to work daily in factories, on farms, in labs and offices, at home, in restaurants and hotels, and so forth. One perspective on them all, drawn from the ILO’s data, raises some uneasy questions about an ambitious new American “global labor” policy.
The ILO figures divide the world’s employed workers pretty clearly into two groups of about equal size. Those in the first group, about 1.7 billion people, work at “okay-to-good jobs” which feature regularly paid wages or salaries, and legal protections for health and safety, labor rights at work, minimum wages, and holidays. Those in the second group have “pretty-bad-to-terrible jobs.” They earn money essentially through paid piecework rather than regular wages or salaries, and as workers holding “informal sector” jobs lack their peers’ legal protection for wages, health, and rights. (For a sense of where they work, earlier ILO research – 2019 – reports the highest rates of “informality” at 92% of all farm workers, 84% of domestic service workers such as maids and nannies, 74% of construction workers, 61% of accommodation and food service workers, and 60% of repair shops employees.) This second tier also features the vast majority of the world’s very worst jobs — that is, those involving abuses such as the world’s 160 million child laborers, and the 241 million extreme-working-poverty jobs paying $2.15 a day or less.
A “global labor” policy meant to fundamentally improve working life should try to help people in the “pretty-bad-to-terrible” second group get into the “okay-to-good” group. The most likely way to do this on a large scale is to help low- and middle-income countries improve labor laws and develop the professional civil services needed to implement these laws throughout their economies, and so change working life for very large numbers of people.
Now to the new policy: Last November, the White House launched a global labor standards strategy, explained in a 3,444-word “Memorandum on Advancing Worker Empowerment, Rights, and High Labor Standards Globally” along with supporting speeches and press releases. The Memorandum sets out a many-tiered array of policies and agency responsibilities to support worker rights abroad, fight child labor and forced labor, improve health and safety standards, and so forth. In principle its policies cover the entire 3.7 billion world labor force. But in practice the Memo’s content — and even more so the releases describing implementation plans — seem (a) to place workers in global “supply chains” employed by large international businesses at the center of policy, and (b) to focus on enforcement against ill-doers rather than on efforts to help workers move from bad to better jobs. Here for example is Julie Su, Acting Secretary of Labor, describing the DoL’s view of its responsibilities at the Memorandum’s November launch event:
“[C]orporations are global. So workers, and worker power, and the way we think about workers have to be global, as well. … When global actors are allowed to evade labor laws in one country by exploiting workers in another part of the world, this undermines workers’ rights everywhere. And when workers are harassed, discriminated against, and attacked as they produce things that are sold all around the world, we cannot simply look away and ignore the ways that our global economy brings with it global responsibility. … The Department of Labor is also expanding its work to combat forced labor and improve transparency and accountability from the top to the bottom of global supply chains.”
It’s certainly good for people and officials in rich countries to think about the lives of factory and logistics workers, and to find ways to reduce abuses in supply chains. But if these are the core focuses, policy is very likely to miss most of the workers in the “pretty-bad-to-terrible” jobs group. The 2023 edition of the “World Employment and Social Outlook” report, for example, drew on a study of 24 middle-income countries to conclude that workers in “global supply chains” (or at least those supply chains ultimately linked to wealthy countries) are more likely than their peers in purely domestic jobs to work in the “okay-to-good-jobs” group with regular pay and legal protection:
“[S]ectors with higher GSC [“global supply-chain”] integration tend to have a larger share of wage and salaries employment, a lower incidence of informality and a lower proportion of low-paid employment — and hence in principle a higher quality of employment.”
The implication is that while it’s easier for policymakers to focus on supply-chain workers connected to the wealthy world than on the “informal” sector maids, day laborers, and farm workers who are less visible to American eyes, the latter group is (on average, based on ILO’s finding) in worse straits and would often improve their lives by getting supply-chain jobs. Likewise, it’s perhaps natural to think first about ‘enforcement’ on individual cases and only later about less glamorous but more systematic efforts to help improve laws and build professional civil service bureaucracies. But the latter task is the main one, if the goal is to make labor standards meaningful for entire workforces. If the next years’ policies are supply-chain and enforcement issues, then, the Memorandum’s achievements will be limited. In some cases – if enforcement in supply chains is such a priority as to slow the flow of workers from “pretty-bad-to-terrible” work into “okay-to-good” supply-chain jobs, or in some cases even push workers out of these jobs altogether — they could have perverse as well as good effects. (See below for a sad 2014 example.) So: probably time for some rethinking, some revisions, and a broader approach.
Policy:
The White House’s “Memorandum on Advancing Worker Empowerment, Rights, and High Labor Standards Globally.”
And November launch comments from Acting Secretary of Labor Julie Su.
Data:
The International Labour Organization’s “World Employment and Social Outlook 2024.”
Informality:
An in-depth ILO look at informal workers and businesses.
And an IMF perspective on informality and economic development.
Case study:
A cautionary lesson on the difficulty of these issues comes from Swaziland, a small inland country on the South African/Mozambique border. Here, a well-intended U.S. effort in 2014 to improve labor standards in garment production through threats to withdraw special “African Growth and Opportunity Act” tariff benefits didn’t work, and carrying through on the threat left the workers in question much worse off.
And some more data:
Where the workers are: The ILO’s 3.51 billion workers, plus 191 million unemployed, mean a world workforce of 3.70 billion people. This total is up by a third from the 2.75 billion of 2000, by over half a billion from the 3.16 billion workers of 2010, or by 26 million this year, representing a growth of 72,000 new workers daily. By region, ILO finds:
Of 2024’s 28 million new workers, meanwhile, 16 million are going to work in sub-Saharan Africa, 7 million in South Asia and the Middle East, and about 3 million each in Latin America and Southeast Asia. In the ILO’s view, employment in the traditionally “wealthy” world — North America, Europe, East Asia (including China), and the Pacific — will be unchanged at 500 million. Taking a longer view, since 2000, the combined shares of North America, Europe, East Asia, and the Pacific have fallen from 50.0% of the world’s workers to 40.6% of the world’s workers; that of Africa, the Middle East, and South Asia, meanwhile, is up from 33% to 41%.
Men and women: ILO counts 2.1 billion men and 1.4 billion women with paying jobs. This makes the working world 60% male — a share identical to the one ILO found in 2000 when there were 1.66 billion men and 1.09 billion women. (The U.S. ratio is now 52% men, 48% women, and was 60/40 in 1973.) The largest skew in ILO’s data is the Arab world, with 48 million working men and 9.6 million women. South Asia is next at 559 million men and 210 million women; the Pacific is closest to labor-force gender parity at 11 million men and 10 million women.
The very poor: ILO reports 241 million in “extreme working poverty,” earning $2.15 or less for 8 hours’ work. This total is 13.4 million more than the 227 million in pre-COVID 2019. Extreme working poverty had fallen steadily for a generation — from 713 million and 27.6% of all workers in 2000 to 427 million and 14.4% of all workers in 2010, and then to 228 million and 6.9% by 2019 — before jumping to 7.7% during the COVID pandemic. It has since drifted back down to 6.9%, the same rate as in 2019. (Though very poor workers are differently distributed: extreme working poverty rates are still falling in Asia and Latin America; Africa’s poverty rate is also falling, but its higher current level and especially strong job growth is keeping the global poverty rate up.) If the DoL strategists writing up the implementation of the Memorandum are looking for an appealing goal, the elimination of extreme working poverty would be a good candidate.
Ed Gresser is Vice President and Director for Trade and Global Markets at PPI.
Ed returns to PPI after working for the think tank from 2001-2011. He most recently served as the Assistant U.S. Trade Representative for Trade Policy and Economics at the Office of the United States Trade Representative (USTR). In this position, he led USTR’s economic research unit from 2015-2021, and chaired the 21-agency Trade Policy Staff Committee.
Ed began his career on Capitol Hill before serving USTR as Policy Advisor to USTR Charlene Barshefsky from 1998 to 2001. He then led PPI’s Trade and Global Markets Project from 2001 to 2011. After PPI, he co-founded and directed the independent think tank ProgressiveEconomy until rejoining USTR in 2015. In 2013, the Washington International Trade Association presented him with its Lighthouse Award, awarded annually to an individual or group for significant contributions to trade policy.
Ed is the author of Freedom from Want: American Liberalism and the Global Economy (2007). He has published in a variety of journals and newspapers, and his research has been cited by leading academics and international organizations including the WTO, World Bank, and International Monetary Fund. He is a graduate of Stanford University and holds a Master’s Degree in International Affairs from Columbia Universities and a certificate from the Averell Harriman Institute for Advanced Study of the Soviet Union.
