Global Unemployment Impacts Advanced and Developing Economies
Sep 13, 2010
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Dominique Strauss-Kahn, managing director of the International Monetary Fund, said the Great Recession left a worldwide "wasteland of unemployment" in its wake, with long term consequences for people in the advanced and the developing nations.
Strauss-Kahn spoke on Sept. 13, 2010, in Oslo, Norway, at the opening of a joint IMF/International Labour Organization (ILO) conference on The Challenges of Growth, Employment, and Social Cohesion. "The loss of jobs is so severe because this recession is so severe," Strauss-Kahn said, "but it’s more complicated than that."
In advanced countries, the long-term impact on young people could lead to "a lost generation, disconnected from the labor market, with a progressive loss of skills and motivation." In developing countries, he said, without adequate social safety nets, people may see little hope of a better future. That may lead them to "unproductive or even violent activities, possibly leading to instability."
"We must acknowledge that the crisis will not be over until unemployment decreases," Strauss-Kahn said. "We must not expect that growth alone will automatically create the jobs we need--and set job creation as priority using all the available policy tools. We need to make the financial system an effective support of the real economy."
"The rules of the game have changed. The global economy after the crisis is not the same as before the crisis. So, in a nutshell, we need to think differently," Strauss-Kahn said.
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