How we work - the facts behind worldwide labour data

Features

  • Author: Carlos Alberto Gómez Grajales
  • Date: 31 May 2016
  • Copyright: Image appears courtesy of Getty Images

We all need to work. Well, most of us at least, lucky those of you who don't have to. But usually, we all need to perform regular activities during our lifetime to receive some form of payment in exchange. In North America, Asia, Europe, everywhere, billions of people every day contribute to the well-being of their nations by going to their jobs. But there are many differences in the way we work. In how we do it, when and how often. So let's take a look at what statistics can tell us about the way we work and how jobs, payment and work conditions differ around the globe.

It is not so simple to compare job and work data between countries, just as much as it isn't easy to compare any official statistic among nations. Direct comparisons of national statistics can be misleading due to different methodological reasonings behind each countries' estimates. For instance, a country might define unemployment as the number of people who don't find jobs, though another one might exclude handicap people from their estimations. As a result, some previous analysis is required in order to standardize the information and produce useful results for comparison.

thumbnail image: How we work - the facts behind worldwide labour data

Thankfully, we don't have to do all that, as there are many organizations working on such comparisons. One of the most reliable sources is, undoubtedly, the International Labour Organization, the first specialized agency of the UN [1]. Devoted to promoting social justice and internationally recognized human and labour rights, this agency also publishes a very rich and detailed compendium of labour statistics, which you can review online [2].

By browsing their data, we can compare some labour indicators, including a crucial one for the development of nations: unemployment rate. Their dataset includes both estimates and projections of unemployment rates for those aged 15 and more, so it can provide us with some very good insights about where our chances of getting a job are actually better. Want a clue? Don’t get anywhere close to Djibouti. According to the ILO official numbers, this African country located north of Somalia will have the highest unemployment rate in the world during 2016, with over half of their population unemployed. Many other small nations will have serious unemployment issues this year, though the ILO projections for 2016 indicate that some big nations have to worry as well.

South Africa, Greece and Spain all have projected unemployment rates of over 20% for the year, so you may be out of luck when trying to find a job there [2]. South Africa is projected to reach an unemployment rate of just over 25%, with Greece just below the 25% benchmark and Spain just below 22%. Jamaica, Puerto Rico, Italy, Egypt, Portugal and France all have projected unemployment rates between 15 and 10%. On the other extreme, Qatar, Thailand and Guinea all have rates below 2%. If you don’t mind the weather, those are great options to move. Guatemala, Japan, Singapore, India, Kuwait, Peru, Bolivia and Honduras all have rates that do not reach 4%. But despite the differences, there's something in common in every country: young adults tend to take the brunt. In every country, those aged between 15 and 24 have the highest unemployment rates. Even in countries with low unemployment, like Mexico, Japan and South Korea, the unemployment rate of young adults nearly doubles that of the general population.

The United Nations aren’t alone in the work of gathering labour data. The International Labor Comparisons (ILC) is a compilation of reports first created by the Bureau of Labor Statistics, which is part of the US department of Labor [3]. Sadly, the Bureau of Labor Statistics discontinued these efforts a few years back, so the role of studying the differences in labour markets in the US was rescued by The Conference Board, a global, independent business membership and research association [4].

Looking at the ILC reports, we can see some interesting trends that the International Labour Organization does not compile. For instance, we see that the world does not usually work on the same stuff. In some countries, like Germany, the United Kingdom and the United States, only 1.5 percent or less of the working population is employed in jobs related with agriculture [5]. In Mexico, that represents about 13.5% of the employment population and Turkey has the highest number with 22%. The UK and the US also have the largest share of people working on services, with over 81%, in contrast with about 52% in Turkey and 63% in Mexico. Still, in every single country studied, people employed in services represent over half of all the working population.

Both the International Labour Organization and The Conference Board offer many more work related indicators, which provide an insightful look at the differences of the dynamics of job markets, but for the time being, let's find some other numbers, as the usual, economic indicators of the working environment are not enough to fully understand how the world is working. We also need to take a look at how we feel at work.

Gallup provides some information on that matter, within the State of the Global Workplace report, a survey applied to 73,752 respondents 18 and older in 141 countries [6]. All of them people unlucky enough to require a daily job.

One of Gallup's main insights from the study is that we simply don't like our jobs enough. Not anywhere. Only 13% of all worldwide employees are engaged with their jobs [6]. This means that less than 1 out of six employees in these countries are emotionally invested with their companies and focused on creating value for them. And employee engagement matters. Companies with the highest engagement numbers in Gallup's survey also have significantly better numbers of productivity, profitability, and customer ratings than those companies near the bottom [7]. Even absenteeism is lower in these organizations.

Well, that may come as no surprise, as most people don't like their jobs. Well, they actually do, at least in some places. The United States has the highest numbers of employment engagement, with 30% of employees engaged: on the other end, East Asia has the lowest proportion of engaged employees in the world, at 6% [7]. China has one of the lowest engagement numbers from the world, at only 6%. India and France marginally improved that with only 9% of their workers engaged, while Brazil has some very good numbers, with up to 27% of the working population giving energy and passion to their works. You might need to consider that proposal from South America. Other great places to get a job are Australia and New Zealand, where 24% and 23% of employers report engagement. The UK is not that bad, with 17% of employees reporting it, five points higher than what we have in Mexico.

How much time should an employee in each country need to work in order to earn enough money to buy a Big Mac? The results show some remarkable differences [9].

Let's start with the lowest part of the table. In Afghanistan, you would need to work more than six hours of minimum wage payment in order to buy a Big Mac [9]. In India, you'd need almost six hours and in Mexico, almost five hours of minimum wage payment will let you enjoy your burger. In France, you can get the same food in about 22 minutes, almost the same amount of time in Britain you would need to work. In the US, employees require 35 minutes to earn their burgers. Australians get theirs in only half of that: 18 minutes.

I know what you're thinking. “Of course the US workers are more engaged, they make more than anyone else”. You'd actually be wrong, since they don't earn the most. A report by ConvergEx Group strategists concludes that the United States have the seventh highest minimum wage among 20 nations compared [8]. With $7.25 an hour, the US are behind Japan, Canada, UK, New Zealand, France and Australia, which has the highest adjusted minimum wage in the study with $16.88 an hour. The lowest federal minimum wage reported is that of Sierra Leone, where workers can expect just $0.03/hour. India is the second worst with a $0.28/hour rate. Argentina has the highest number in Latin America with a $3.79 an hour wage.

But even if these numbers are interesting, comparing incomes is actually quite tricky, as the intricacies of the local economies tend to affect those comparisons. The purchasing power of a dollar is not the same in the US and Sierre Leone. In order to make some better comparisons we have other options, some tasty enough to use them.

The now globally famous Big Mac index was invented by The Economist magazine in 1986. The magazine explains it in their website [9]:

“A lighthearted guide to whether currencies are at their “correct” level. It is based on the theory of purchasing-power parity (PPP), the notion that in the long run exchange rates should move towards the rate that would equalise the prices of an identical basket of goods and services (in this case, a burger) in any two countries.”

Using this index and comparing it with the minimum wage among these nations, the ConvergEx Group prepared a more insightful comparison: How much time should an employee in each country need to work in order to earn enough money to buy a Big Mac? The results show some remarkable differences [9].

Let's start with the lowest part of the table. In Afghanistan, you would need to work more than six hours of minimum wage payment in order to buy a Big Mac [9]. In India, you'd need almost six hours and in Mexico, almost five hours of minimum wage payment will let you enjoy your burger. In France, you can get the same food in about 22 minutes, almost the same amount of time in Britain you would need to work. In the US, employees require 35 minutes to earn their burgers. Australians get theirs in only half of that: 18 minutes.

I hope that, by now, you have discovered that you work in a great place, in a country where income and work engagement are over the roofs. Sadly I haven't, so I'd better change the topic a bit. Instead of discussing how we work, let's talk about how we are going to work, which is a topic we statisticians enjoy. Why? Simply because data analysis is key in the future of the job market.

An analysis done by LinkedIn, a business social network created for professional networking, reported that Statistical analysis and data mining was the second most wanted skill among recruiters [10]. It is the only skill category that consistently ranked in the top 4 across all of the countries LinkedIn analysed. So it doesn't matter if you need to work a lot to buy a Big Mac or not, the market around you requires statistics. Even in developing economies, there's a need for the skills that only data experts can provide. So the future is bright for those interested in number and stats (which I assume includes most of you since you are reading this). But do not forget, look for that data job in Australia, not only they earn more and have great engagement numbers: they also tend to sleep really well [11].

[1] Origins and History. International Labour Organization Website.
http://www.ilo.org/global/about-the-ilo/history/lang--en/index.htm

[2] ILOSTAT Database. International Labour Organization Website.
http://www.ilo.org/ilostat/faces/oracle/webcenter/portalapp/pagehierarchy/Page137.jspx?_afrLoop=144538577625890&clean=true#%40%3F_afrLoop%3D144538577625890%26clean%3Dtrue%26_adf.ctrl-state%3Dc79f1lh88_233

[3] Charting International Labor Comparisons. The Conference Board. Trusted Insights for Business Worldwide. Website
https://www.conference-board.org/ilcprogram/

[4] About Us. The Conference Board. Trusted Insights for Business Worldwide. Website
https://www.conference-board.org/about/index.cfm?id=1980

[5] Crabtree, Steve. Worldwide, 13% of Employees Are Engaged at Work. Gallup Website.
http://www.gallup.com/poll/165269/worldwide-employees-engaged-work.aspx

[6] State of the Global Workplace. Gallup Website.
http://www.gallup.com/services/178517/state-global-workplace.aspx

[7] Boesler, Mathew. Here's How America's Minimum Wage Stacks Up Against Countries Like India, Russia, Greece, And France. Business Insider Website (August, 2013)
http://www.businessinsider.com/a-look-at-minimum-wages-around-the-world-2013-8

[8] The Big Mac Index. The Economist Website (January, 2016)
http://www.economist.com/content/big-mac-index

[9] Mahapatra, Lisa. Minutes Of Minimum-Wage Work To Buy A Big Mac: 36 minutes in the US, 6 hours in Afghanistan. International Business Times (August, 2013)
http://www.ibtimes.com/minutes-minimum-wage-work-buy-big-mac-36-minutes-us-6-hours-afghanistan-1392339

[10] Murthy, Sohan. The 25 Skills That Can Get You Hired in 2016. LinkedIn Official Blog (January, 2016)
https://blog.linkedin.com/2016/01/12/the-25-skills-that-can-get-you-hired-in-2016

[11] Holliday, Katie. Singaporeans among most sleep deprived worldwide. CNBC Website (August, 2014)
http://www.cnbc.com/2014/08/21/singaporeans-among-most-sleep-deprived-worldwide.html

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