With a few exceptions, industrialized nations are still struggling with unemployment, unable to recover completely from the 2008 economic crisis. In the U.S. things seem to be improving as the unemployment rate fell in January to 8.3 percent, its lowest level since early 2009, according to the U.S. Department of Labor’s Bureau of Labor Statistics. But all in all, whether it is lack of job opportunities for young people around the world, or that the global economy is not generating as many jobs as needed to keep up with labor force growth, the global job narrative is one of doom and gloom.
Nevertheless, there are reasons for optimism, particularly in the developing world. While major industrialized nations still struggle with unemployment, emerging markets are certainly doing better.
According to the new edition of Job Trends, released by the World Bank today, emerging economies continued their slow but steady job recovery in the third quarter of 2011. We are talking about countries like Brazil, China, Mexico and Turkey. But they are not the only ones. Across Eastern Europe and Central Asia, as well as in East Asia and Latin America, the employment picture has been improving over the past year in the 23 developing countries included in our global sample.
Most of the Eastern European and Central Asian countries that were covered showed a strong recovery. Employment growth in Turkey, for instance, increased to 7 percent, while wage growth remained high. In Latin America, the rapid recovery of earlier months has begun to moderate, but unemployment in most of the region fell slightly. In Brazil, for example, despite the slowdown in both GDP and wage growth in the third quarter of last year, unemployment came down to 6 percent. Furthermore, Brazil reported in December an unemployment rate of 4.7 percent, the lowest recorded since 2002.
Trends in East Asia are also positive. Urban China continues to combine impressive growth in earnings with substantial growth in employment. In South Africa, although unemployment remains remarkably high, employment growth picked up substantially, in part because of a drop in wage growth.
Many observers may see these improvements as not very consequential because, after all, wages and labor conditions in much of the developing world are below what is expected in industrialized nations. But while the global economy remains threatened by the troubles in the Eurozone, market volatility, and overall uncertainty, any positive development in emerging markets is significant. As many have noticed, one key question for 2012 is whether emerging market economies will be robust enough to partially cushion the potential impact of things getting worse in the Eurozone and elsewhere. That emerging economies continue their slow but steady recovery on the job front can only be a sign in the right direction. I’m confident that emerging economies will eventually carry the day.