Goal 8: Decent work and economic growth
The Lao PDR has made progress but still has some way to go in achieving productive employment and decent work. Labour productivity grew from 1995 to 2010, but this was because high economic growth outstripped the growth in employment. The largely resource-driven and capital-intensive growth meant that GDP per person employed grew, but did not generate a sufficient number of decent employment opportunities.
The agriculture and fishery sectors dominate in Lao PDR, accounting for about 70 percent of employed persons in 2010. This has implications for decent work and poverty reduction, since the agriculture sector has low productivity (4 to 10 times lower than non-agricultural sectors in 2010) with a lack of domestic value-added.
Lao PDR’s employment-to-population ratio (ETPR) has decreased, but remains among the highest in the region (77.7 percent in 2010). One reason for the high ETPR in Lao PDR is poverty – the poor cannot afford not to work. A large percentage of the employed work in semisubsistence agriculture, which is the main driver of the high ETPR. The ETPR is highest in the remote rural areas without road access and lowest in urban areas.
Over a third of working people do not earn sufficient income to lift themselves out of poverty. Some 36 per cent of employed people belong to the two poorest quintiles of the household population.
The share of vulnerable employment in Lao PDR remains high. Own-account workers and unpaid family workers constitute 84 per cent of those who work. The high level of vulnerable employment is driven by the agriculture and fishery sector, sales workers, and elementary occupations. Within these three sectors, respectively 99, 73 and 73 per cent of workers are in vulnerable employment (self-employed, but not employer, or in unpaid work for the family). The bulk of agricultural work is characterized by low incomes, poor working conditions and deficits in access to both social protection and workplace representation. However, vulnerable employment is not confined to agriculture. Since informal employment is widespread, other jobs often have low pay and poor working conditions.
The unemployment rate is low, at only 2 per cent in 2015 (2.0 per cent for males, 2.0 per cent for females).
Lao migrants abroad – a large source of income for families in southern Lao PDR – are a vulnerable group. These migrants make up around 8 percent of the working population, mostly in low-paid, labour intensive work in neighbouring Thailand. Remittances sent back home by Lao migrants in 2013 accounted for 1.9 percent – 2.5 percent of the country’s GDP.
The Sustainable Development Goals aim to encourage sustained economic growth by achieving higher levels of productivity and through technological innovation. Promoting policies that encourage entrepreneurship and job creation are key to this, as are effective measures to eradicate forced labour, slavery and human trafficking. With these targets in mind, the goal is to achieve full and productive employment, and decent work, for all women and men by 2030.
Over the past 25 years the number of workers living in extreme poverty has declined dramatically, despite the lasting impact of the 2008 economic crisis and global recession. In developing countries, the middle class now makes up more than 34 percent of total employment – a number that has almost tripled between 1991 and 2015.
However, as the global economy continues to recover we are seeing slower growth, widening inequalities, and not enough jobs to keep up with a growing labour force. According to the International Labour Organization, more than 204 million people were unemployed in 2015.
The SDGs promote sustained economic growth, higher levels of productivity and technological innovation. Encouraging entrepreneurship and job creation are key to this, as are effective measures to eradicate forced labour, slavery and human trafficking. With these targets in mind, the goal is to achieve full and productive employment, and decent work, for all women and men by 2030.