In Asia and the Pacific, GDP is estimated to have grown by 4.3 per cent in 2023.
Reopenings of the economy from COVID-19 restrictions, including the removal of lockdown measures in China, contributed to stronger growth in 2023 (compared with 3.9 per cent in 2022).

In China the removal of these constraints resulted in increased domestic spending as households spent accumulated savings (World Bank 2023a).

Meanwhile, tourism to the region from high income economies has rebounded, surpassing pre-pandemic levels in 2022.

However, some countries in the Pacific, such as the Solomon Islands, are unable to tap into the tourism recovery, owing to an exodus of skilled labour that took place following the closure of tourism-related businesses during the pandemic.

Although inflation has affected the region, price controls, subsidies and interest rate hikes have been lower than in other emerging and developing regions, with certain exceptions such as some countries in South Asia.

Improved economic circumstances have facilitated the phasing out of pandemic- and costof-living-related support measures, allowing the stabilising of fiscal positions (ADB 2023). As many of these dynamics settle, growth is expected to continue at around 4.1 per cent in 2024.

South Asia is expected to have had the highest growth rate in the region in 2023, 5 per cent, compared with 4.2 per cent in East Asia and 3.8 per cent in South-East Asia and the Pacific .

Although many countries in Asia and the Pacific were able to avoid the accelerating inflation seen in other regions, a number of South Asian countries – including Bangladesh, India and Pakistan – have implemented import suppression measures and face energy shortages, both of which have been affecting industrial output.

These countries also have limited fiscal room to provide stimulus or respond to exogenous shocks in the future, should that be required

Moreover, some countries, such as Sri Lanka and Pakistan, have been struck by financial crises. Nevertheless, India has buoyed growth for the South Asia subregion, thanks in part to high investment growth.

In South-East Asia, Indonesia, too, is expected to have exhibited relatively strong growth through 2023, which is projected to continue into 2024, as a result of high commodity prices bolstering export earnings.

Labour market trends in Asia and the Pacific In 2023, labour force participation trends returned to a pre-pandemic downward trend for Asia and the Pacific.

The labour force participation rate, which had been decreasing over the past two decades (from 66.4 per cent in 2000 to 60.2 per cent in 2019), is decreasing again following a turbulent period between 2019 and 2023 owing to the impact of the pandemic .The labour force participation rate in2023 is estimated to have been 60.9 per cent;it is expected to decrease in 2024 and 2025 (to 60.5 per cent and 60.4 per cent, respectively).

This modest long-term decline has largely been driven by socio-economic developments in the low- and middle-income economies of the region as poverty rates have decreased and youth educational enrolment has improved.

At the same time, women’s labour force participation rates have been increasing because of women’s improved access to the labour market, particularly in South Asia, where the women’s labour force participation rate (30.8 per cent) was 45.9 percentage points lower than the men’s (76.7 per cent) in 2023, compared with a gap of 51.2 percentage points in 2010.

Employment growth in the region has picked up, driven by job growth in South Asia. The employment growth of 2.4 per cent between 2022 and 2023 is significantly greater than the pre-pandemic long-term average of 0.9 per cent per annum (2010–19). This corresponds to an employment-to-population ratio of 58.2 per cent in 2023,almost the same as the long-term pre-pandemic average (2010–19), suggesting that employment growth is keeping pace with population growth.

Mean weekly hours per person employed, 44 hours per week in 2023, have remained lower than the long-term pre-pandemic average of around 46 hours per week (2010–19). This may have been driven by developments in East Asia, where total hours worked in the economy have been decreasing since the onset of the pandemic – owing to weak economic growth in China – as well as over the long term (by 0.2 per cent per annum between 2010 and 2019).

At around 4.5 per cent, the regional unemployment rate fell below pre-pandemic levels in 2023, but this figure conceals heterogeneity across countries and age groups. The unemployment rate is expected to remain constant over the next two years and significantly lower than the spike in 2020 of 5.5 per cent. It is also lower than the pre-pandemic level – 4.7 per cent in 2019 – and the long-term average between 2010 and 2019 of 5.1 per cent.

East Asia’s unemployment rate in 2023 was higher than in 2019, 4.7 per cent compared with 4.3 per cent,respectively; the rates in the other subregions were all lower or only marginally higher in 2023 than in 2019.

Youth unemployment continues to be a significant challenge for the region. The youth unemployment rate in 2023 is estimated to have been around 14.4 per cent, on average, in Asia and the Pacific, marking a steady increase from 12 per cent in 2010 and less than 10 per cent in 2000.

Particularly high youth unemployment rates in China – reported to have been 20.4 per cent in April 2023 in urban areas – have driven the overall rate for East Asia (ILO 2023f).

Youth continue to encounter decent work deficits, which exacerbate this age group’s pre-existing vulnerabilities. Alongside the elevated and increasing unemployment rate in the region, informal employment affects more than eight out of ten young workers in the region, and one in four young workers live in households subsisting below the moderate poverty threshold of US$3.65 per day in PPP terms (ILO and ADB 2020).

At the same time, more than 144 million youth in the region are NEET, the majority of whom are women; the NEET rates of young women are especially high in South Asia. There was a lack of youth-targeted approaches in Asia and the Pacific during the pandemic; the one-size-fits-all approaches that were generally used failed to give specific attention to vulnerable groups such as youth (ILO 2023g).

Informality and new forms of work in Asia and the Pacific In Asia and the Pacific, nearly two thirds of total employment was informal employment in 2023.

This rate has decreased from 72.7 per cent two decades earlier, in 2004, but in 2023, at 66 per cent,it still accounted for 1.3 billion people in the region.

The informal employment rate varies considerably within the region, being highest in South Asia (87 per cent in 2023), followed by South-East Asia (70 per cent) and then East Asia (47 per cent) and the Pacific (35 per cent) .

Informality affects countries in this region at varying degrees of economic development, and new forms of work continue to bring challenges on this front even in countries that have made substantial progress.

Low- and middle-income countries continue to have elevated levels of informal employment. For instance, Nepal’s informal employment rate was around 82 per cent in 2017 and Pakistan’s around 84 per cent in 2021 (ILO 2023h). Although many high-income economies (Australia, Japan, Republic of Korea, New Zealand) have fared relatively better, seeing sustained reductions in informal employment, new forms of work, including jobs in the platform economy,present new and different challenges to tackling informality (ILO, forthcoming).

New forms of work arrangements offer a number of opportunities, but they also expose legal and policy gaps, thereby presenting new challenges to reducing informality. The growth of non-standard forms of work, including the gig and platform economy, has been driven by new technologies.

 Although these new forms of work present a range of opportunities, including flexible work arrangements, and benefits to both businesses and workers, several downsides prevail, including lack of job security, irregular and low incomes, and limited access to social protection schemes.

Moreover, many of these new forms of work are outside the scope and coverage of employment laws and regulations (ASEAN Secretariat 2023). The Republic of Korea is one country that has been introducing policy changes to address the informality emerging from new forms of work – for example with a National Employment Insurance Roadmap to cover all workers, including non-regular and gig workers, as well as legislation to help specify accountability for labour platform operators (ILO, forthcoming).

“Non-standard employment”, as defined by the ILO, comprises four different types of wage employment that deviate from the standard employment relationship. These include temporary employment (casual work and fixed-term contracts), part-time work and on-call work arrangements, triangular employment relationships (temporary agency work and other forms of labour brokering or labour dispatch) and disguised employment or dependent self-employment relationships (where workers are legally classified as self-employed but someone else directs their work) (ILO 2016).