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TitleWorld Employment and Social Outlook, Transforming jobs to end poverty, ILO 2016.
LanguageEnglish
File Size4.1 MB
Total Pages192
Table of Contents
                            Table of contents
List of figures
List of tables
List of boxes
Preface
Acknowledgements
Executive summary
Introduction
Part I. Jobs and earnings of the poor
	1. Poverty and the world of work: A global overview of trends
		A. Overview of poverty trends
		B. Who are the poor and what types of jobs do they have
		C. Income sources of the poor
		D. Non-income dimensions of poverty
		E. Concluding remarks
		Appendix A. Regional, country and income groupings
		Appendix B. Distribution of the poor and non-poor and poverty rates
		Appendix C. Income sources of the poor
		Appendix D. Income sources of the poor
by employment status
		Appendix E. Change in poverty
		Appendix F. Non-income dimensions of poverty
		References
	2. Addressing the income gap
		Introduction
		A. Estimating the income needed to eliminate poverty
		B. Demographic and economic dependency ratios 
and decent work deficits
		C. Mix of policy responses needed to close the income gap
		D. Concluding remarks
		Appendix A. Minimum amount to eliminate poverty 
(total and composition)
		Appendix B. Aggregate poverty gaps by country: level and composition (extreme and moderate poverty), 2012
		Appendix C. Total income gap as a percentage of current public social protection expenditure 
(various poverty lines, 2012)
		Appendix D. Impact of social protection on poverty reduction 
and prevention, country data
		Appendix E. Social protection or an increase in labour incomes: A simplified case-by-case analysis
		Appendix F. Methodological appendix to estimate
the proportion of the gap filled 
by social protection
		Appendix G. National sources: list of household surveys
		References
	3. Transforming growth and jobs to reduce poverty
		Introduction
		A. Overview of growth and poverty
		B. Transforming jobs for poverty reduction
		C. Concluding remarks and links
with Part II of the report
		Appendix A. Growth, inequality and poverty
		Appendix B. Types of employment and incidence of poverty
		References
Part II. Policies to transform jobs and incomes to end poverty
	4. A rights-based approach to poverty reduction
		Introduction
		A. International labour standards as an enabling mechanism for poverty reduction
		B. Improving application and enforcement of international labour standards in order to reach the poor
		C. Concluding remarks
		References
	5. The role of decent work in ending poverty in the rural economy
		Introduction
		A. Agriculture and the rural economy: 
Opportunities and challenges for poverty reduction
		B. Reducing poverty through agricultural productivity growth
		C. Alternatives to smallholder agriculture: 
Off-farm activities and agricultural wage employment
		D. Concluding remarks
		References
	6. Supporting people and promoting quality jobs
		Introduction
		A. Role of social protection in alleviating poverty among those not of working age and those unable to work
		B. Supporting people back into employment
		C. Addressing job quality and working poverty
		D. Concluding remarks: Ensuring coherence 
in anti-poverty strategies through labour market 
institutions and social dialogue
		References
                        
Document Text Contents
Page 1

Transforming jobs
to end poverty20

16

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EMPLOYMENT
SOCIAL
OUTLOOK

WORLD

Page 2

International Labour Office • Geneva

WORLD
EMPLOYMENT
SOCIAL
OUTLOOK
2016
Transforming jobs to end poverty

Page 96

84 World Employment and Social Outlook 2016 – Transforming jobs to end poverty

Developed countries
(<60 per cent median income/consumption expenditure)
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Panel A. People living in households with more than 25 per cent of household members of working age in paid employment:
solely wage and salaried employment

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ECA = Europe and Central Asia
UM = Upper-middle income

LAC = Latin America and the Caribbean
ECA = Europe and Central Asia
LI = Low income

ECA

Cases where an improvement in labour income can play a major role

Figure 2E.2

Source: ILO calculations based on the analysis of microdata from 103 national household surveys.

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Page 97

2. Addressing the income gap 85

The share of the total income gap to be covered by social protection is a function of two main dimen-
sions and a set of principles.

The two main dimensions are:

• The proportion of people able and willing to work, with an emphasis on the proportion of people in
paid employment;

• The distance to the poverty line (or to the minimum level of per capita consumption observed at
the national level).

A set of principles:

• The income gap is fully filled by social protection transfers for people in old age and for people aged
15–64 who have disabilities and are unable to work;

• Other groups are potentially covered through a mix of social protection transfers and improved
labour income (directly or indirectly). Children, for instance, benefit from the improvement in their
parents’ labour income.

The share of the gap filled by social protection transfers is calculated based on survey data and is the
same for each member of a given household.

The formula is as follows:

Share of the gap filled by social protection transfers = [1 – ( “extended” economic dependency ratio*(1-DistPovline))) × 100

with:

Dimension 1 The economic dependency ratio dimension:

Extended economic
dependency ratio =

[number of household members in paid employment + a × (number of contributing family members
+ number of unemployed)] / household size revised

Household size revised = Household size – number of people above 64 years old – number of people aged 15–64 with disabilities
and unable to work (because of their disability)

a = 1 – (number of contributing family members + unemployed) ÷ household size revised
The share of contributing family workers and unemployed accounts for job creation and opportunities
for paid employment.

Rationale A high ratio is an indicator of a low level of labour income per labour income earner. The extreme case is when
a household is fully composed of people in paid employment but whose income does not lift them above the
poverty line.
• A ratio of 100 per cent means that the maximum value of labour income is inferior to the poverty line.
• A ratio of 50 per cent means that income from labour is at a maximum just below 2 times the poverty line.

Dimension 2 Distance to poverty line (for all people below the poverty line)

Distance to poverty line = Poverty gap ÷ (poverty line – minimum per capita consumption expenditure (or income) at the national level)

Poverty gap = Poverty – per capita consumption expenditure (or income)

Poverty line = Set in the context of this report to $1.90 PPP, $3.10 PPP, $5 PPP and 60 per cent of disposable household
income (for developed countries in the latter case).

As a first approximation the proportion of the income gap to be filled by social protection focuses on
individual needs and household features. The capacity of the national context to cope with the add-
itional cost for social protection or of the national protection system to reach the poor, or the availability
of more and better jobs, are not taken into consideration in the present chapter.

The share of the gap filled by social protection transfers provides an estimate of the additional cost for
social protection – most likely largely financed by government resources – while part of the income gap
is to be covered by an improvement in labour incomes.

Appendix F. Methodological appendix to estimate
the proportion of the gap filled
by social protection

Page 191

182 World Employment and Social Outlook 2016 – Transforming jobs to end poverty

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conducting studies for wage setting and estimating labour supply response (Geneva, ILO).

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benefits on poverty outcomes for single mothers, Working Paper No. 3, Herman Deleeck
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Wicks-Lim, J.; Thompson, J. 2010. Combining minimum wage and earned income tax credit policies
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Woolard, I.; Harttgen, K.; Klasen, S. 2010. The evolution and impact of social security in South
Africa, paper prepared for the Conference on “Promoting resilience through social protection
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The World Employment and Social Outlook 2016 shows that
decent work is paramount in the fight to reduce poverty. The
report indicates that poverty has tended to decline in many
emerging and developing countries whereas it has tended
to increase in the majority of developed countries, including
in terms of the incidence of working poverty. The report
examines the types of jobs and incomes that the poor have
come to rely on, paying particular attention to the quality of
jobs and the role of social protection in poverty reduction. It
demonstrates that it is not possible to reduce poverty in a
sustainable manner unless decent work opportunities are
made available to the poor. This finding relies on an analysis
of labour market and poverty trends over the past two decades
in more than 100 countries, covering a range of developed,
emerging and developing countries.

The report examines the role that policies play in enhancing
decent work opportunities and reducing poverty. It documents
a range of country initiatives in the areas of job-centred
economic policies, employment programmes, enterprise
development, social protection and social dialogue. The
evidence that emerges indicates that well-designed decent
work policies can successfully contribute to ending poverty.
They can boost productivity, notably in the agricultural sector
and in rural areas, where the majority of the poor are located.
These policies are also instrumental in facilitating transitions
to formal employment in developing countries and improving
the earnings prospects of the working poor. The report
also discusses the role of international labour standards in
reducing poverty and inequality, thus making growth more
inclusive, an essential factor in ensuring that the fragmented
nature of global production does not leave the most vulnerable
individuals behind.

This analysis provides evidence on the role of decent work in
achieving the Sustainable Development Goals – which is at
the heart of the United Nations 2030 Agenda for Sustainable
Development.

ISBN 978-92-2-130387-9

9 789221 303879

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