The ILO warned that the economic fallout caused by the special military operation in Ukraine and rising inflation causing real wages to plummet are creating turmoil in the labor market, leading to fewer jobs. (Related: Recession or DEPRESSION? Check out how many American companies are laying off employees this year.)
The UN body warned that there are already signs that a potential recovery in global hours worked seen in early 2022 was immediately reversed following the imposition of sanctions against Russia in the second and third quarters. This has led to 40 million fewer full-time jobs between July to September than in the fourth quarter of 2019, which is being used as the benchmark level.
If trends persist, the number of full-time jobs around the world will continue to deteriorate until the end of the year.
The ILO is also blaming part of the decreasing jobs growth on central banks around the world increasing interest rates excessively. The agency warned that this excessive policy tightening could cause "undue damage to jobs and incomes in both advanced and developing countries."
ILO Director-General Gilbert Houngbo called for a series of policies aimed at supporting the most vulnerable people and businesses. Some proposals include diverting windfall corporate profits towards programs that support employment and targeted measures to assist the most vulnerable enterprises.
"We cannot insist enough on the need for social packages and the need to ensure that the monetary tightening to combat the inflation is really dovetailed with social measures," said Houngbo during a press briefing in Geneva.
In the United States, job openings in September rose to roughly 1.9 for every unemployed person in the country. In August, the ratio was 1.7 job openings per unemployed person.
This is according to the Department of Labor's monthly Job Openings and Labor Turnover Survey, which was released on Tuesday, Nov. 1. The number of available positions increased to 10.7 million in September, up from around 10.3 million available jobs in August.
Nick Bunker, head of economic research at labor market analysis firm Indeed Hiring Lab, said this data shows that "demand for workers remains robust."
"By all the key metrics in this report, the labor market is resilient," wrote Bunker in a note.
Unfortunately, the Federal Reserve is claiming it still needs to raise interest rates.
According to the Fed, the elevated number of job openings proves that it can cool the labor market – and therefore inflation – by raising interest rates without causing a surge in unemployment.
"The labor market is still too tight for the Fed," warned Jason Draho, head of the asset allocation for the Americas at UBS Global Wealth Management. "That really fuels the expectation that the Fed has to do more hiking."
The Fed is expected to raise interest rates by another 0.75 percent this month as it fights to bring down demand for labor and for inflation to come down to its target of two percent or less.
But, as the ILO pointed out, more policy tightening could only make the situation worse, not just for workers in the U.S., but also workers around the world who rely on a strong American economy for them to remain employed.
Watch this clip from "The Evening Edit" on Fox Business discussing the dip in worker productivity.