Approximately 800 million young people entering the labour market in developing economies over the coming years will not find jobs unless countries act, the head of the UN Development Programme (UNDP) warned on Tuesday, as the agency launched two initiatives to boost investment and employment.
"If you look at the next 15 years, there will be 1.2 billion young people graduating from school, going into the labour market," UNDP Administrator Alexander De Croo told a press briefing in New York from Bangkok, where he is attending the World Bank Group-International Monetary Fund ( IMF ) Annual Meetings.
"Unfortunately, for only 400 million of these, there will be jobs. For 800 million of these, there will not be jobs."
Mr. De Croo said the gap was driven by demographics - in many developing countries, the median age is between 18 and 25 - and that the job projections were based on the current state of technology.
"That is not going to go by itself. This is the result of policy," he said.
From investment to jobs
Of the two initiatives, the Investment Accelerator will help governments improve investment policies and legal frameworks, build pipelines of investment-ready projects and move them from preparation to implementation.
The Jobs for Prosperity Facility will help countries identify sectors with strong job-creation potential, align skills with what employers need and tackle barriers to business investment and hiring.
Asked whether artificial intelligence (AI) was a factor, Mr. De Croo said the projections could change through active labour policies, noting that sectors such as care, agriculture and tourism would still create many jobs even as AI accelerates.
"Job creation is actually the only real sustainable way for people to grow out of poverty," he said.
Both initiatives are backed by expanded partnerships with the World Bank Group, the European Investment Bank and the European Bank for Reconstruction and Development, with pilot initiatives already underway in Nepal, Yemen, Haiti, Lebanon and Ghana.
A 'triple shock'
The launch comes as many developing countries face what Mr. De Croo called a "triple shock": high energy costs, one of the most pronounced El Niño events since 1950, and very high borrowing costs.
According to a new UNDP report, No Time to Recover , the median developing country now spends 9.5 per cent of total government income on interest payments alone.
For the first time since 2010, the number of people living in multidimensional poverty - which measures not only income but also access to electricity, water, health care and education - has risen.
"Those numbers should absolutely be a wake-up call to all of us," Mr. De Croo said.
While the global economy has proved more resilient than expected, that resilience is not shared equally, he added.
"Some countries have still quite strong economic fundamentals. Others do not have the fundamentals to withstand further shocks."
