Development Centre

Action is needed to secure future livelihoods in developed and emerging economies, says the OECD Development Centre

 

Securing Livelihoods For All: Foresight for Action, a report that uses a foresight approach to develop five possible livelihood landscapes for the world in 2030, shows that vulnerability and the risk of falling back into extreme poverty remain high in the face of a changing global context.

In most developing regions, 80% of people feel they are struggling or even suffering in their daily lives, rather than thriving. Furthermore, emerging trends in the economy, technology, demography, environment and security could negatively impact livelihoods – defined as the ability to support oneself and thrive now and in the future – in the next decades.

“The outlook for livelihoods is fragile. Emerging global trends are creating a lot of uncertainty, and we need to find innovative ways to ensure resilience of livelihoods”, said Carl Dahlman, Head of Global Development Research at the Development Centre. “Still, in all middle and low-income countries, people generally think that the future will be better than the past or the present. The greatest optimism is in the East Asia-Pacific region” he added.

 

 

Thriving, struggling or suffering? Regional perceptions of life

 

livelihoods graph EN

access underlying data

Source: Author’s calculations using Gallup (n.d.), Gallup World Poll, Gallup Analytics, Gallup Inc., Washington DC, www.gallup.com/services/170945/world-poll.aspx

 

 

Worrying global trends include:

  • Increasing inequality as the benefits of economic growth are not shared equally. The poorest 66% of the world’s population are estimated to receive less than 13% of world income, while the richest 1% receive nearly 15%. And around 70% of the world’s undernourished live in middle-income countries.
  • Jobless growth both in emerging and developing economies. The case of China is striking: between 1991 and 2012, GDP multiplied by a factor of almost nine (adjusted for inflation), while total employment remained almost static, and the workforce participation rate of 24-65 year olds fell from 85% to 77%.
  • Jobs are further challenged by rapid technical change and automation. Even white-collar occupations such as accountancy, legal work and technical writing may eventually be phased out.
  • Persisting financial fragilities. Policy measures taken in recent years to reduce the fragility of the financial and banking systems have been considerable, but more is needed to make the system truly robust. The next major shocks may well come from emerging markets, whose growing corporate sector has benefited from massive lending by the global financial system.
  • The growing youth population in Sub-Saharan Africa – where the labour force is growing by 8 million people a year - and in South Asia – where it is growing by 12 million a year - which will become a source of major stress if they do not have enough jobs.
  • Environmental and resource challenges, particularly the expected increase in severe drought incidence. By 2050, more than 40% of the world’s population will live under severe water stress.
  • New security concerns – such as cybercrime and terrorism –threaten livelihoods in addition to traditional conflicts due to geopolitical unrest.

Despite these challenges, the report is optimistic that livelihoods can be secured if innovative initiatives are taken. It makes a call for action at all relevant levels to seize these opportunities:

  • At the global level, efforts must continue to increase co-ordination and co-operation to create the right conditions for livelihoods in many fields, from financial stability to climate change, from international trade to migration, from water governance to cyber security.
  • National governments can be enablers of vibrant societies and a back-stop in hard times. For example, to address the jobs challenge, governments could enhance opportunities for lifelong learning and promote livelihood portfolios made up of part-time work, paid training, and unemployment benefits.
  • Local initiatives help secure livelihoods, for example, by supporting a vibrant shared local economy in which individuals can survive through a patchwork of entrepreneurial and social initiatives involving exchanges, barters and virtual service marketplaces. The introduction of local currencies (also known as complementary or community currencies) for example, could shelter local communities from the turbulence of volatile global financial markets.

For further information, journalists should contact Bochra Kriout (Tel.: +33 145 24 82 96) at the OECD Development Centre.

 

Notes:

Securing Livelihoods For All: Foresight for Action is supported by The Rockefeller Foundation

The Development Centre occupies a special place within the OECD and in the international community. It is a forum where countries at different levels of development come to share their experience of economic and social development policies. The Centre contributes expert analysis to the development policy debate. The objective is to help decision makers find policy solutions to stimulate growth and improve living conditions in developing and emerging economies.