The global labor income share represents the share of total income earned by workers.
the World Employment and Social Outlook: September 2024 UpdateThe ILO said the global labour income share will fall by 0.6 percentage points between 2019 and 2022 and then remain stable, worsening a long-term downward trend.
The ILO noted that if this rate had remained at the same level as in 2004, labor income would have increased by $2.4 trillion in 2024 alone.
“The COVID-19 pandemic was the main driver of this decline, with around 40% of the decline in labour income shares occurring in the pandemic years, 2020-2022,” the report said.
“The crisis has exacerbated existing inequalities, in particular as capital income continues to be concentrated in the hands of the wealthiest, undermining progress towards Sustainable Development Goal 10, which aims to reduce inequalities within and among countries,” the ILO added. The ILO further said technological advances, including automation, have contributed to this trend. “These technological innovations have boosted productivity and output, but evidence shows that workers have not shared fairly in the resulting gains,” it added. The report warned that without comprehensive policies to ensure that the benefits of technological advances are broadly shared, recent developments in the field of artificial intelligence could deepen inequalities and put at risk the achievement of the SDGs.
“Countries must act to counter the risks of a decline in the labor income share,” said ILO Deputy Director-General Celeste Drake.
“Achieving inclusive growth and paving the way for sustainable development for all requires policies that promote the equitable sharing of economic benefits, including freedom of association, collective bargaining and effective labor administration,” Drake added.
