Employment and Social Trends 2026 Report | 20 Jan 2026

Source: TH 

Why in News? 

The International Labour Organization (ILO) has released the Employment and Social Trends 2026 report, estimating the global unemployment rate at 4.9% in 2025. 

What are the Key Highlights of the Employment and Social Trends 2026 Report? 

  • Stalled Progress on Employment Quality: Improvement has slowed over two decades. Between 2015–2025, the decline in extreme working poverty was only 3.1 percentage points (to 7.9% or 284 million workers), far less than the previous decade's 15-point drop. In low-income countries, 68% of workers lived in extreme or moderate poverty in 2025. 
    • Extreme working poverty refers to the situation in which employed persons live in households with a per capita income or consumption level below the international extreme poverty line (less than USD 3 a day). 
  • Rising Informality: The global informality rate increased by 0.3 percentage points (2015–2025), with 2.1 billion workers projected to be informally employed by 2026. 
  • Slowed Structural Transformation: The pace of workers moving across economic sectors has halved globally over the last two decades. This slowing transition to formal, productive sectors is a major driver of weak job quality and productivity growth. 
  • Uneven Unemployment & Employment Growth: The global unemployment rate remained at 4.9% in 2025 (forecast 186 million unemployed in 2026), with a jobs gap of 408 million. Employment growth is uneven, i.e.,  declining in high-income countries (2026), slow in upper-middle-income countries (0.5%), but faster in low-income countries (3.1%). 
  • Persistent Gender and Youth Gaps: Women represent only two-fifths of global employment, with a 24.2 percentage point lower labour force participation than men. The global youth unemployment rate rose to 12.4% in 2025, with 257 million young people as NEET (Not in Employment, Education, or Training). 
  • Insufficient Productivity & Labour Income Growth: Labour productivity growth remains low, especially in low-income countries. The global labour income share (52.6% in 2025) is below its 2019 level, showing real wage growth lags productivity growth. 
  • Emerging Risks from AI and Trade: AI adoption poses a heightened risk to educated youth in high-skilled entry-level jobs. Trade policy uncertainty threatens real wages and job creation, particularly in regions like South-Eastern Asia and Europe. 
  • Uneven Benefits from Trade: While 465 million jobs depended on foreign demand in 2024, low-income countries are largely excluded from trade and investment flows, limiting their access to better-quality, trade-linked jobs. 

What are the Findings Related to India? 

  • Economic Growth: India is expected to be among the highest growth economies in the Asia-Pacific region, sustaining elevated GDP growth for Southern Asia. 
  • Manufacturing Share: India's share of global manufacturing (in current US dollar terms) is reported at 3%, which is significantly lower than China's 27% and the United States' 17%. 
  • Renewable Energy Strategy & Employment: India has developed a large-scale renewable energy capacity. India is noted as making significant headway in increasing the number of renewable energy jobs, alongside Japan and the Republic of Korea. 
  • Green Talent Gap: In India and the wider Asia-Pacific region, the demand for green talent is far outstripping the available supply. 

International Labour Organization (ILO) 

  • About: ILO is a specialized agency of the United Nations dedicated to advancing social and economic justice through the promotion of internationally recognized human and labour rights. 
  • Foundation & Mandate: Established in 1919 under the Treaty of Versailles post-World War I. It became the UN's first specialized agency in 1946 and won the Nobel Peace Prize in 1969. 
  • Objective: Formulation of international policies to promote fundamental human and labour rights, better working conditions, and employment opportunities. 
  • Unique Tripartite Structure: The ILO uniquely brings together representatives from 187 member states' governments, employers' organizations, and workers' organizations (trade unions), ensuring policies reflect all social partners. 
  • Principal Governance Bodies: 
    • International Labour Conference: The annual highest decision-making body. 
    • Governing Body: The executive council that sets policy and budget. 
    • International Labour Office: The permanent secretariat in Geneva, led by the Director-General. 
  • Key Reports: Employment and Social Trends, World Employment and Social Outlook, Global Wage Report, World Social Protection Report, and Social Dialogue Report. 

Frequently Asked Questions (FAQs) 

1. What is the global unemployment rate for 2025 according to ILO? 
The ILO Employment and Social Trends 2026 report estimates the global unemployment rate at 4.9% in 2025. 

2. According to the report, what are the major risks to future employment? 
The major emerging risks are AI adoption, which threatens high-skilled entry-level jobs for youth, and trade policy uncertainty, which threatens real wages and job creation. 

3. How does India's performance compare in the report's findings? 
India is a high-growth economy but has a relatively low share  (3%) in global manufacturing. 

UPSC Civil Services Examination, Previous Year Questions (PYQs) 

Q. International Labour Organization’s Conventions 138 and 182 are related to (2018)

(a) Child Labour  

(b) Adaptation of agricultural practices to global climate change  

(c) Regulation of food prices and food security  

(d) Gender parity at the workplace  

Ans: (a)

Q. Disguised unemployment generally means (2013)

(a) large number of people remain unemployed 

(b) alternative employment is not available 

(c) marginal productivity of labour is zero 

(d) productivity of workers is low 

Ans: (c)