Manufacturing growth has underpinned India’s recent economic performance, which may help buffer demand for the region’s commodity exporters, said an International Labour Organisation (ILO) report.

The report “World Employment Social Outlook - Trends 2017” said that economic growth in Asia and the Pacific has been relatively resilient, at 5.1 percent in 2016 and 5.0 percent anticipated in 2017. While buoyant – above 5 percent forecast over the next five years – and following annual average growth of 5.6 percent over the past decade, a slight easing of the region’s economic growth reflects, in part, ongoing readjustment to China’s “new normal” growth path. Eastern Asia’s growth has declined from 7.9 percent in 2010 to 4.6 percent in 2016 (4.5 percent forecast in 2017).

Despite this, China continues to prop up regional exports, but pressure is mounting for countries with high export dependence on China to diversify both products and export partners. In the midst of the transition, India has stepped up, achieving 7.6 percent growth in 2016, thus helping Southern Asia achieve 6.8 percent growth in 2016 (6.9 percent expected in 2017). This compares to 4.5 percent in South-Eastern Asia and the Pacific in 2016 (4.7 percent in 2017).

Accounting for nearly 60 percent of the global workforce, the Asia and the Pacific region’s net employment expanded by over 20 million in 2016, equivalent to growth of around 1.1 percent, with a similar expansion anticipated in 2017. Southern Asia has created most of the new employment, with employment expanding by 13.4 million in 2016, underpinned by population-driven labour force growth. The majority of this new employment was created in India.

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The ILO report said that total employment expanded by around 5 million in South-Eastern Asia and the Pacific, equivalent to growth of 1.6 percent, and is forecast to grow by another 4.5 million in 2017, with Indonesia and the Philippines accounting for the majority of employment growth in this sub-region. In Eastern Asia, employment is growing the least, at less than half a percentage point each year, largely as growth of China’s workforce starts to shrink.

The shape of employment growth reflects the structural transformation taking place in the region; that is, the transfer of capital and workers from low to higher value added sectors. Since 2008, employment in agriculture has been shrinking across each of the Asia and the Pacific sub regions, offset by expansion of employment in services and industry. These trends are expected to continue to different degrees over the next five years.

At the same time, however, low female labour force participation continues to be a major challenge for a number of economies within the region, particularly in Southern Asia. In fact, Southern Asia exhibits the third lowest female labour force participation rate of all regions globally, only behind the Arab States and Northern Africa. With only 28.5 percent of working-age women in Southern Asia active in the labour market, women are typically more reliant on their male counterparts as the main breadwinner of the household. At the same time, when women are in employment, they are more likely to be in vulnerable employment, particularly contributing family work (in 2016, as many as one in five women are contributing family workers, compared with less than 5 percent of males in Asia and the Pacific).

In 2016, some 81.7 percent of all employed women in Southern Asia were in vulnerable forms of employment, compared to 72.4 percent for their male counterparts. While the female vulnerable employment rate in South-Eastern Asia and the Pacific is also high, at 54.8 percent, the gap between men and women is less marked.

Read: ILO World Employment Social Outlook - Trends 2017