Asia-Pacific Labour Markets Rebound Post-Pandemic but Face Challenges from Rapid Ageing: ILO Report

Unemployment in the region is projected to remain steady at 4.2% for 2024 and 2025, equating to 87.8 million unemployed individuals in 2024.

Asia-Pacific labour markets have shown a robust recovery since the global pandemic, but they are now confronting significant challenges exacerbated by the region's rapidly ageing population, according to the International Labour Organization's Asia-Pacific Employment and Social Outlook 2024.

Unemployment in the region is projected to remain steady at 4.2% for 2024 and 2025, equating to 87.8 million unemployed individuals in 2024. Although the region's overall unemployment rate remains below pre-pandemic levels, there are significant disparities between different subregions and countries. In 2023, the region faced a jobs gap of 164 million, reflecting the total unmet need for employment, including women unable to search for jobs due to care obligations.

Persistent issues such as working poverty and informality continue to affect the region, with a significant number of workers still engaged in low-quality, informal employment. In 2023, two-thirds of workers were in informal employment, showing only a modest improvement of 2 percentage points over a decade.

The report highlights the region's rapid population ageing, with the ratio of people aged 65 and above expected to double by 2050. This demographic shift will increase the economic dependency ratio, challenging sustained economic growth. East Asia is anticipated to experience the most significant demographic drag on growth at 0.3 percentage points annually, while South Asia's demographic dividend is expected to decline substantially.

Despite ageing populations, the region can potentially achieve continued income growth per capita over the coming decades if strong productivity growth is maintained. Labour productivity in emerging economies in Asia and the Pacific is less than one-third of that in high-income countries in many sectors, indicating a substantial potential for efficiency and income gains. To realize these gains, structural barriers and a lack of training opportunities need to be addressed to enable the region's large workforce to take up better, higher-paying jobs.

Significant policy reforms and improved implementation of existing standards are crucial to reducing inequalities, enhancing labour market prospects for older workers, and ensuring equitable pension systems to manage the demographic changes.

"The Asia-Pacific region may be ageing rapidly but it is not going to run out of workers. There is, however, an urgent need to ensure that those seeking decent work can access the training and opportunities they need to meet evolving labour market demands," said Chihoko Asada-Miyakawa, ILO Assistant Director-General and Regional Director for Asia and the Pacific.

The report underscores the need for robust social dialogue involving workers, employers, and governments to address these complex challenges. Initiatives such as the Global Accelerator on Jobs and Social Protection for Just Transitions are highlighted as essential steps towards advancing social justice in the region.