ILO Cuts 2025 Global Jobs Forecast Amid Slower Growth

The International Labour Organization (ILO) has revised its global employment forecast for 2025, projecting the creation of 53 million new jobs, representing 7 million fewer than previously expected. The change reflects downgraded global economic prospects, with GDP growth now projected at 2.8%, down from the earlier 3.2% estimate.

The updated forecast, released in the ILO’s latest World Employment and Social Outlook (WESO) report, adjusts global employment growth from 1.7% to 1.5%. The estimates are based on April 2025 data from the International Monetary Fund’s World Economic Outlook.

According to the ILO, the slower job growth is partly due to rising geopolitical tensions and disruptions in trade. The report estimates that about 84 million jobs across 71 countries are linked to US consumer demand. These positions, particularly concentrated in the Asia-Pacific region, are increasingly vulnerable to shifting trade dynamics. While 56 million of these jobs are located in Asia-Pacific, Canada and Mexico have the highest proportion of exposed jobs at 17.1%.

“We know that the global economy is growing at a slower pace than we had anticipated it would,” says Gilbert Houngbo, Director General, ILO. “If geopolitical tensions and trade disruptions continue, they will most certainly have negative ripple effects on labour markets worldwide.”

The ILO’s report also highlights a continuing decline in the global share of income going to workers. Labour income as a share of GDP dropped from 53.0% in 2014 to 52.4% in 2024. The Americas and Africa experienced the steepest reductions. According to the ILO, had the 2014 share been maintained, global labour income would have been US$1 trillion higher last year, equivalent to US$290 more per worker in real terms.

Other structural changes are also reshaping labor markets. The report points to a gradual shift toward high-skilled employment, with women leading the trend. Between 2013 and 2023, the share of women in high-skilled occupations increased from 21.2% to 23.2%, compared to 18% for men in 2023. However, gender-based occupational segregation remains. Women are still underrepresented in fields such as construction and overrepresented in clerical and caregiving roles.

Despite improvements in educational attainment, a significant mismatch persists between qualifications and job requirements. In 2022, only 47.7% of workers held education credentials aligned with their jobs. The share of under-educated workers has declined over the past decade, but the percentage of over-educated workers rose from 15.5% to 18.9%.

The report also assesses the impact of Generative AI on the workforce. Nearly one in four workers are expected to experience changes to their job roles due to AI integration. While medium-skilled jobs are more widely exposed to AI, high-skilled jobs are more likely to face task automation.