The ILO approach pursues a twin objective: to ensure that individuals enjoy income security when they lose their earnings due to the inability to obtain suitable employment; and to promote full and productive employment. That objective can be achieved through unemployment insurance or assistance and is strategically linked with active labour market policies (ALMPs), which include high-quality public employment and social services; lifelong learning, skills development and vocational/ labour orientation and training services; and incentives for enterprises to facilitate work transitions and build more inclusive labour markets and social protection systems, paying special attention to marginalized groups.
Flagship Thematic Area: Unemployment
Providing unemployment protection for all
- The ILO estimates that, as a result of the COVID-19 pandemic and lockdown measures, 255 million full-time jobs were lost in 2020 relative to the fourth quarter of 2019, approximately four times more than during the global financial crisis of 2009.
- The pandemic highlighted the crucial role of unemployment protection schemes in ensuring income security for workers and their families. By facilitating structural change and a just transition for enterprises and workers in all sectors, unemployment protection programmes are also essential to support those adversely impacted by technological innovations and environmental and climate change.
- Globally, 96 countries have established an unemployment protection scheme in law, mostly through social insurance mechanisms. Only 18.6 per cent of unemployed workers worldwide actually receive unemployment benefits (SDG indicator 1.3.1), with large regional disparities.
- Further efforts are required to adapt unemployment protection schemes to ensure coverage for workers in all types of employment, as well as young people, persons with disabilities, older workers, women, the long-term unemployed and persons engaged in flexible work arrangements.
Approach and Technical Support
- Facilitating the tripartite dialogue between ministries of labour and employers’ and workers’ organizations to achieve informed decisions on the design and reforms of unemployment protection schemes; Analysis of labour market indicators, as well as legal provisions and social protection programmes, in order to protect against the risk of unemployment, identify broad options for the unemployment protection scheme and support its articulation with existing provisions (such as severance payments);
- Assessment of the social protection systems and their linkages with employment support and ALMPs, programmes and institutions with a view to defining the institutional set of the unemployment protection scheme and its linkages with activation programmes;
- Actuarial assessment to determine the cost and financial sustainability of various design options for the unemployment protection scheme (contribution rates, duration and level of benefits, qualifying periods), in agreement with the international social security standards. For this, the ILO/Unemployment Insurance generic actuarial model can be easily adapted to the specific context of each country;
- Design of the operations and procedures and development of management information systems for registering applicants, processing claims and payments and providing job placement and counseling services;
- Support for the design of the extension of unemployment protection policies and schemes to workers in all types of employment, focusing on access to decent and productive employment and linking with policies for the transition to formal economy; and support for the dissemination, ratification and application of Convention No. 168 and Recommendation No. 176, including through legal and policy assessments and capacity-building to advance a better understanding of its strategic fit and content.
Under the thematic area of unemployment protection, the Flagship Programme will work on the following knowledge products and outputs.
- Country briefs will be developed on good practices and experiences to extend unemployment protection, including learning from the COVID-19 pandemic responses.
- A global guide will be developed on designing and implementing unemployment protection schemes, in application of Conventions Nos. 102 and 168 and Recommendation No. 176.
- Technical assistance to Member States to design or reform their unemployment protection schemes may be funded through trust-in-fund projects between the ILO and governments or social security institutions.
- The ILO maintains a long-standing partnership with the Government of Japan and the Republic of Korea for strengthening capacities and fostering the sharing of experiences among Asian countries.
- Building on the experience of the public–private partnership between the ILO and UNIQLO on strengthening unemployment protection in Indonesia, the ILO continues to explore similar initiatives with the business sector.
- The Emergency Unemployment and Stabilization Employment Fund in Jordan, which links emergency funding from multiple partners with the building of sustainable social insurance systems, is also an interesting example of partnership.
- Following the partnership between the ILO and the EU on responding to the COVID-19 crisis through the global programme on the theme “Improving linkages between social protection and public finance management” and between ILO and the Federal Ministry for Economic Cooperation and Development of Germany (BMZ) on supporting the garment industry, the ILO seeks to strengthen such partnerships with the EU and EU Member States in this area.
Latest ILO Projects and Programmes
- Building Social Protection Floors for All - Phase II
- PROSPECTS - Inclusive jobs and education for refugees and host communities in Uganda
- Strengthening Social Security Office capacities in policy design with a focus on research and actuarial services
Indicators of results and impact
- The draft legislation for the establishment of an Unemployment insurance Fund has been submitted to parliament
- Garment sector workers benefitted from a one-time partial unemployment cash benefit
- An actuarial valuation study on unemployment was approved
- An Unemployment Insurance Fund has been established
- The Government issued a regulation on the Implementation of (un)Employment Insurance
- An unemployment insurance scheme came into force
News and Events
[CANCELLED] Unemployment Insurance in Indonesia: Challenges and Recommendations
27.06.2023 - 27.06.2023
Provincial tripartite consultation on old-age income security in West Java, Indonesia
12.06.2023 - 14.06.2023
Adaptive social protection forum: Social insurance and climate change in Indonesia
08.06.2023 - 08.06.2023
Céline Peyron Bista
Social protection and employment policy specialist