World Bank on the wrong track

INTERNATIONAL CONFEDERATION OF FREE TRADE UNIONS

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World Bank on the wrong track to more jobs for young people

Brussels, 16 September 2006: As the World Bank launches its annual flagship publication, the World Development Report 2007: Development and the Next Generation, the global labour movement laments its approach on how to get more young people into employment.

"The World Bank rightly recognises that more and more young women and men are unemployed or toil in underpaid and exploitative conditions. But it doesn't address this problem adequately and it prescribes the wrong medication for how to fix it. Indeed, many of the Bank's proposals will only create greater troubles for the world's youth", said Guy Ryder, General Secretary of the International Confederation of Free Trade Unions.

This year's World Development Report is on youth, defined as the group aged 12-24, and focuses on the main transitions that young people go through. One of these is 'going to work', which is also the title of a main chapter in the report. Here the Bank attacks a series of labour market institutions such as minimum wages, unemployment benefits and dismissal rules as the main cause for youth unemployment.

"The World Bank has done away with the carrot and seems to think that the stick is what it takes to put young people to work. They fail to see that young people don't choose to stay unemployed but are forced to be so by a global economy that doesn't create enough jobs", Ryder continued, emphasising that though the world has experienced growth rates of 3.8 percent per year on average over the last ten years, the world's employment ratio has declined with 1.4 percentage points, while youth unemployment climbed from 70 to 85 million from 1995 to 2005.

"The first step in beating youth unemployment should be to repair the many dysfunctions of the global economy that international institutions like the World Bank themselves are responsible for", Ryder said and was complemented by Willy Thys, General Secretary of the World Confederation of Labour: "It is indeed the Bank's own standard policies and conditionalities - government austerity, deregulation, privatisation and liberalisation - that has created many of the problems the report tries to address, such as growing poverty among young people and the fact that a majority of youth, particularly young women, only can find work in the informal economy".

"The analysis and recommendations of the World Bank are one-sided and narrow", Thys continued and said: "It is a shame that what is supposed to show the prime of the Bank's research capability is as biased and selective as it is in its use of evidence. Again and again it only cites sources that support its agenda of deregulation and liberalisation while ignoring those that might show a different result. The irony indeed is that it ignores several World Bank studies* that conclude the opposite of what the WDR 2007 has chosen to say," Thys concluded.

"The World Bank should take a more comprehensive approach to youth employment, which should also include more attention to gender equality. To ensure decent work for more young people, policies should focus on 4 issues", Ryder said. "Creating more decent jobs for young people; ensuring the quality of existing and new jobs; enhancing skills, qualifications and access to education; and improving the transition between school and work as well as shortening the time youth might find themselves unemployed. The Bank does mention skills, qualifications and transitioning but ignores general job-creation and, in fact, undermines the quality of much work", Ryder ended.

The World Development Report 2007: Development and the Next Generation can be accessed here: http://www.worldbank.org/wdr2007

The ICFTU represents 155 million workers in 241 affiliated organizations in 156 countries and territories: http://www.icftu.org ICFTU is also a member of Global Unions: http://www.global-unions.org

The WCL represents 30 million workers worldwide: http://www.cmt-wcl.org/

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