Unions warn of rising inequality if growth without jobs and decent wages continue

The vast majority of the world’s people are still waiting for increased job security, higher wages and access to universal social protection, warn unions ahead of the G20 Labour Ministers meeting in Argentina 6-7 September.

“Inequality is at an historic high and is rising with no sign of abating and workers’ wages are stagnating while productivity and profits soar. Global economic growth is not reaching the pockets of working people. Meanwhile, the concentration of wealth is increasing, with 50 companies holding a combined wealth equivalent to 100 countries. The dominance of digital businesses whose massive stock prices are not based on real profits is a risk to workers, competition, tax revenues and the economy as a whole,” said Pierre Habbard, General Secretary, Trade Union Advisory Committee to the OECD (TUAC).

The current economic model has contributed to the decline in the labour share of income across the world, and to wages systematically falling behind productivity growth – a model that denies workers their fair share of the fruits of economic progress.

Ninety-four per cent of workers in the world’s supply chains are in low-wage, insecure and often unsafe work. Seventy per cent of the world has no or inadequate social protection while at least USD 21 trillion is stashed away in tax havens.

“Raising wages, strengthening social protection, enhancing collective bargaining and reducing inequality can lift employment, reduce informality, strengthen aggregate demand and promote overall economic development and growth,” said Sharan Burrow, ITUC General Secretary.

However, five-year trend data from the ITUC Global Rights Index shows the decline of collective bargaining and workers’ rights, between 2014 and 2018:

-  exclusion from freedom of association has increased by 15 % (80 countries to 92 countries);

-  violations of collective bargaining has increased by 32% (87 countries to 115 countries);

-  violation of the right to strike has increased by 41% (87 countries to 123 countries).

Trade unions are calling on the G20 Labour Ministers to commit to a nine-point plan, which deepens and goes beyond past commitments:

-  Ensuring minimum wages are based on and adjusted according to the cost of living;

-  Promoting freedom of association and collective bargaining, particularly on wages;

-  Reinforcing and investing in universal social protection systems;

-  Purging global supply chains of precariousness, informality, slavery and child labour and ensuring that companies take responsibility for their obligations towards workers including by incorporating human rights due diligence throughout their operations;

-  Dealing with climate change and contributing to the realising of the objectives of the Paris Climate Agreement by promoting and implementing strategies for a Just Transition to a low-carbon economy;

-  Preparing the workforce for a Just Transition to a digital future of work;

-  Promoting gender pay equality and anti-discrimination in the labour market; investing massively in the care economy and training to create new jobs and lift millions of others out of informality; also, violence in the workplace must be addressed including with legislation on domestic violence leave;

-  Addressing the persistent high youth unemployment levels including through active labour market policies and investment in formal training; and
-  Planning for the integration of refugees and migrants and lifting barriers to social inclusion.

The G20 must not lose sight of commitments made on the labour income share, fair wage policy principles, workers’ rights throughout and inside global supply chains, the equal participation of women and men in employment and wages, youth inclusion, occupational health and safety and skills development.

“Last years’ G20 Labour Ministers declared that violation of workers’ rights could not be part of the competition. This needs to be made real. All employers must take responsibility for decent work for all their workers, whether directly employed or through contractors in supply chains,” said Sharan Burrow.

The latest findings from the 2018 Walk Free Slavery Index make delivering on this commitment an imperative. G20 countries annually import over USD 354bn ‘at risk’ products, produced from sectors in countries where people are subjected to forced labour.

According to Walk Free, twelve G20 countries are yet to formally enact laws or policies to stop businesses sourcing goods from forced labour. Australia, Brazil, China, France, Germany, Italy, UK and US have all introduced or are taking steps to introduce laws that would tackle modern slavery – others need to do the same.

“Inequality, unemployment, modern slavery, historic levels of displacement of people, violence against women, marginalised young people, increasing military conflict with an escalation of spending on armaments – we live in a fractured world and it is the G20 must who show the leadership to effect change. The rules of the global economy must be rewritten to grow sustainable economies,” said Burrow.

The Labour 20 holds a two-day summit in Mendoza, Argentina, on 4-5 September ahead of a consultation with the G20 Labour and Employment Ministers.

Read the L20 Statement to the G20 Labour and Employment Ministers’ Meeting

For interviews with Sharan Burrow or more information on the L20 contact Gemma Swart [email protected] +32 479 06 41 63

For interviews with Pierre Habbard contact Anna Byhovskaya, [email protected]