Enhance productivity to reduce poverty: UN

Highlighting linkage between poverty and labour productivity, a new UN report has said that proper investment in training and skill enhancement would help reduce poverty to a great extent.

"Productivity is the cornerstone for poverty alleviation," International Labour Organisation's Chief of the Employment Trends Team Lawrence Jeff Johnson said briefing reporters on the report titled 'Key Indicators of the Labour Market'.

"The only asset the poor have is often their labour. And if we are to reduce poverty, we need to improve productivity," Johnson said yesterday adding that bolstering skills and labour could play a key role.

In South and East Asia, Johnson pointed out that the ILO has seen a marked decrease in the working poor, which he defined as those individuals that are working but are unable to earn at least $2 a day for themselves and for their families.

"Although productivity in East Asia has doubled in the last 10 years, the United States remains the global leader by a considerable amount in terms of labour productivity per person employed in 2006", the report noted.

South Asia, Central and South-Eastern Europe (non-European Union countries) and the Commonwealth of Independent States have all seen their productivity rise in recent years.

However, the situation is different in sub-Saharan Africa, where there has been only "moderate" growth in productivity, he said. 

The report also said that the productivity gap between the industrialised region and most others remains wide, even as productivity levels have been on the rise over the past decade worldwide.

The labour agency stated that an increase in productivity is largely due to firms better utilising capital, labour and technology, and thus limited investment in training and skills, equipment and technology could lead to an underutilisation of the world's labour potential.

"The huge gap in productivity and wealth is cause for great concern," said Juan Somavia, ILO Director-General.

"Raising the productivity levels of workers on the lowest incomes in the poorest countries is the key to reducing the enormous decent work deficits in the world.

The report found the US has increased its productivity growth over most other developed economies, with $63,885 of value added per person employed in 2006, followed by Ireland ($55,986), Luxembourg ($55,641) and Belgium ($55,235).

But the report noted that Americans work more hours per year than workers in most other nations with developed economies, and thus Norway has the highest labour productivity level when measured as value added per hour worked.

While productivity levels have increased worldwide over the past decade, the report said, gaps remain wide between the industrialised region and most others although South Asia, East Asia, and Central and South-Eastern Europe and CIS have begun to catch up.

Stressing the need for decent work that delivers fair income, security and social protection, the reports said hundreds of millions of women and men are working without conditions that would lift them out of poverty.