Direct link between food security and better jobs, says ILO

A new report from UN agency, the International Labour Organization (ILO), provides evidence that higher food prices and increased food insecurity don’t just mean greater poverty but have a negative effect on employment levels.

The World of Work Report 2011, Making markets work for jobs (download here),  argues that investing in food security is one important approach to job creation. While the report’s focus is on the developing world, its conclusions can be generalised to poorer communities within developed countries. The UK is a  particularly interesting case, because its policy of pursuing food security by investing in developing world production appears to have had a negative effect on poor communities among consumers at home and within the  producer countries overseas.

Food, according to the ILO, has become a major financial product in recent years. This has increased the prices paid by consumers but has not proportionately benefitted primary producers. Instead,  the profits have enriched intermediaries and finance companies. The volatility of food prices has also provided a boon to financiers who can profit from rises and falls alike while producers suffer because price uncertainty undermines investment.

At the other end of the food chain, says the report, food price rises fuelled by speculation and increased energy costs have a negative effect on total household income which increases poverty, reduces consumer spending on non-food producst and services, cascades through economies destroying jobs in its wake, and – according to the report – creates a downward pressure on real wages.

The most disturbing conclusion in this section of the report is that the negative effects of higher food prices can create long term problems by reducing government tax receipts in producer and consumer countries alike, with the effect that education and health programmes suffer.

While the ILO acknowledges that the worst problems are seen in the poorest countries, it also points out that the food market globally has become distorted by the involvement of relatively food secure countries like China, Saudi Arabia and the UK in overseas ‘land grabs’ aimed at securing production of biofuels, cash crops or short term investment opportunities. Much of this activity seems to be speculative, but its effect is to increase food price volatility and further entrench speculation in food commodities.

Understandably, the ILO focuses on the disastrous consequences of under-investment in agriculture for the poorest economies of the developing world. It is, however, worth noting that disadvantaged communities within the richest countries of the world suffer from exactly the same causes and with similar negative effects on employment, health and education. The market in food has become disconnected from the real needs of consumers and producers. Until that issue is resolved, we will have food poverty in every corner of the globe.

Share

Hide Sites