Four billion people have no social protection, according to the International Labor Organization. The ILO’s director-general, Gilbert Houngbo, told panelists at an IMF seminar that four times as many jobs were lost during the COVID-19 pandemic as the global financial crisis, “placing additional pressures on already stretched and indebted households.”
With prices rapidly rising, cash-strapped governments will have to strike a balance between policies to tackle inflation and growth. “The social contract agenda,” said University of Michigan professor Justin Wolfers, “is ultimately undergirded and paid for by economic growth.”
The decline in development assistance and rise in debt make it harder for governments to provide the support that’s needed. Houngbo suggested “other tools such as channeling excessive profits from the energy sector” to employment and income initiatives.
Sara Cumbers of World Risk Poll concluded with some key principles for social spending, including public engagement and making data more readily available and transparent.
