Disruptions in trade – from tariff shifts to supply chain uncertainties – risk suppressing wage growth and job quality, especially in regions like Southeast Asia, Southern Asia and Europe.

Global unemployment is projected to remain broadly stable in 2026, but a major new report from the International Labour Organization (ILO) lays bare a stark reality: having a job no longer equates to a decent living or secure future for hundreds of millions of people worldwide. The Employment and Social Trends 2026 flagship report highlights deepening structural weaknesses in labour markets that threaten progress on sustainable development and social equity.

According to the ILO’s analysis, the world’s unemployment rate is expected to stay at around 4.9 per cent this year – roughly equivalent to 186 million people without work. That stability, while superficially encouraging, masks persistent and widening deficits in job quality, social protection, and labour market inclusivity.

Stability Conceals Deep-Seated Challenges

The headline figures suggest the labour market has weathered recent economic shocks better than feared, particularly in the aftermath of global disruptions from trade tensions, geopolitical uncertainty and the lingering effects of the COVID-19 pandemic. Yet beneath this veneer of stability lies a more troubling picture: millions of workers remain trapped in low-paying or insecure jobs that offer few protections or pathways out of poverty.

Nearly 300 million people continue to live in extreme poverty, surviving on less than US$3 a day despite being employed – a measure often used to assess “working poverty.” Meanwhile, an estimated 2.1 billion workers are expected to remain in informal employment in 2026, with limited access to social protection, labour rights, secure contracts, or benefits.

This trend in job quality casts a long shadow over global development goals. Decent work – defined by fair wages, safe conditions and opportunities for meaningful livelihood – is central to Sustainable Development Goal 8, which seeks inclusive economic growth and productive employment for all by 2030. The ILO’s findings show the world remains far from meeting these commitments.

Youth at Risk: A Generation Left Behind

The report’s starkest warnings concern young people. Globally, unemployment among those aged 15 to 24 is significantly higher than the general rate, with projections suggesting around 12.4 per cent of young people will be jobless. Even more concerning, more than a quarter of youth in low-income countries – about 27.9 per cent – are neither in education, employment nor training (NEET), jeopardising both their economic prospects and the broader potential of emerging workforces.

AI and automation, while offering opportunities for new types of employment, also pose risks. The ILO cautions that rapid technological adoption without adequate policy safeguards could make it harder for young, educated entrants to find high-skill jobs, particularly in wealthier economies. This underscores a need for policies that ensure technology complements rather than displaces human labour.

Women’s Participation Stalls, Inequality Persists

Gender equity in the labour market shows only incremental progress. Women still occupy just about two-fifths of all jobs globally, and social norms continue to limit their participation in many economies. According to the report, women are approximately 24 per cent less likely to be engaged in the workforce than men, and gains toward narrowing that gap have slowed.

The ramifications extend beyond employment rates: lower labour participation among women contributes to ongoing inequalities in income, economic security and decision-making power within households and communities. As the world strives to meet broader equity and empowerment goals, these dynamics remain a significant barrier.

Trade Uncertainty, Informality and Fragile Gains

International trade continues to play a pivotal role in employment, with some 465 million jobs worldwide linked to export demand and global supply chains. Yet disruptions in trade – from tariff shifts to supply chain uncertainties – risk suppressing wage growth and job quality, especially in regions like Southeast Asia, Southern Asia and Europe.

The ILO emphasises that informal work – often characterised by low wages, lack of benefits, and limited legal protections – disproportionately affects vulnerable populations and limits the ability of workers to cope with economic shocks. Reducing informality remains a crucial but elusive target.

Policy Responses and the Road Ahead

In response to these challenges, ILO Director-General Gilbert F. Houngbo has urged governments, employers and worker organisations to adopt coordinated strategies that strengthen labour rights, expand social protection, and enhance skills development. Such policies, he argues, are essential to unlocking decent work opportunities and narrowing structural inequalities.

The report also points to demographic shifts – including ageing populations in high-income countries and rapid population growth in low-income regions – as factors reshaping labour supply and demand. To harness demographic dividends, countries must invest in education, workforce training, and inclusive job creation.

Stability Is Not Enough

The Employment and Social Trends 2026 report paints a world of labour markets that appear stable on the surface but remain fraught with fragility and inequity beneath. While headline unemployment figures might offer a sense of calm, the reality for workers – especially young people, women, and informal employees – is precarious at best.

As policymakers around the globe contemplate strategies for sustainable development in the decade ahead, the central challenge will be ensuring that work is not just available, but also decent, rewarding and secure.