The global unemployment rate is expected to remain steady in 2026, a leading international agency said Wednesday, but warned the labor market's seeming stability belies a dire shortage of decent jobs.
The U.N.'s International Labour Organization (ILO) said the global economy and labor market appeared to have weathered recent economic shocks better than expected.
But the ILO warned that efforts to improve global job quality had stagnated, leaving hundreds of millions of workers wallowing in poverty, even as trade uncertainty risked cutting into workers' wages.
The global unemployment rate was estimated at 4.9% last year and the year before, and is now projected to remain at a similar level until 2027, a report from the U.N. labor agency said.
That amounts to 186 million people out of work this year, it said.
"Global labor markets look stable, but that stability is quite fragile," Caroline Fredrickson, head of the ILO's research department, told reporters, cautioning that the "apparent calm masks deeper and unresolved problems."
At a time when U.S. President Donald Trump has slapped towering tariffs on friends and foes alike, the report cautioned that "disruptions caused by trade uncertainty, combined with ongoing long-term transformations in global trade, could significantly affect labour market outcomes."
Going forward, the ILO said its modelling suggested that a moderate increase in trade policy uncertainty "may reduce returns to labour and, as a consequence, real wages for both skilled and unskilled workers across all sectors," especially in Southeast Asia, Southern Asia and Europe.
The potential of trade to generate new employment opportunities was also being challenged by the ongoing disruptions, the report said, pointing out that 465 million jobs globally depended on foreign demand through exports of goods and services and related supply chains in 2024.
Another major concern highlighted by the ILO was the quality of jobs available.
"Resilient growth and stable unemployment figures should not distract us from the deeper reality: hundreds of millions of workers remain trapped in poverty, informality, and exclusion," ILO chief Gilbert Houngbo said in a statement.
Nearly 300 million workers continue to live in extreme poverty, earning less than $3 a day, Wednesday's report found.
At the same time, some 2.1 billion workers are expected to hold informal jobs this year, with limited access to social protection, labor rights and job security.
Young people remain particularly vulnerable, with unemployment among 15- to 24-year-olds projected to reach 12.4% for 2025, with around 260 million young people not engaged in education, employment, or training, the ILO said.
It warned that artificial intelligence and automation could exacerbate challenges, particularly for educated young people in wealthier countries seeking their first high-skill jobs.
"While the full impact of AI on youth employment remains uncertain, its potential magnitude warrants close monitoring," the report said.
The ILO also highlighted "entrenched gender inequalities," pointing out that women still account for just two-fifths of global employment.
"Stable labor markets are not necessarily healthy," Fredrickson said, stressing the growing need for "domestic policy choices to strengthen decent work outcomes."
"Without decisive action, today's stability risks giving way to deeper inequalities."
