Muhammad Hammad

The world is facing significant social challenges, including economic and social inequalities, insecurity, and declining trust in institutions. Despite progress in reducing extreme poverty, many people struggle to earn sufficient incomes, and financial vulnerability is fuelling distrust and social divisions. The current social situation is unsustainable, and the report argues that this crisis is largely the result of policy choices that prioritize free markets and economic efficiency over people-cantered development.

The report calls for a new policy consensus based on equity, economic security for all, and solidarity. It emphasizes the need for structural transformations in policy, institutions, norms, and mind-sets, and a fundamental reorientation of policymaking through a social lens. A new consensus must prioritize strong social policies, investments in public institutions, and a people-centred approach to development, moving beyond the current over-reliance on markets.

Insecure Livelihoods and Enduring Poverty Risks

Despite unprecedented improvements in material well-being, many people worldwide feel economically insecure and vulnerable to deprivation. According to a recent evaluation, 60% of people globally are struggling, and 12% are suffering. Over 690 million people live in extreme poverty, and 2.8 billion live on $2.15-$6.85 a day, making them susceptible to falling into poverty due to small shocks. Climate change and conflicts exacerbate poverty, with nearly one in five people at high risk from climate-related disasters and one in seven exposed to conflict.

Informal employment and precarious jobs are widespread, leading to economic instability and income insecurity. Almost 60% of people worldwide are worried about losing their jobs and not finding a new one. The divide between formal and informal workers is significant, with formal wage workers having more job security than those in informal employment. The gig economy and digitalization have also contributed to the commodification of work, making it easier to hide human activity and render workers invisible.

The growing rift between labour market regulations and the changing world of work is a significant driver of insecurity. The lack of universal social protection and labour rights has made workers more vulnerable to income insecurity and exploitation. To address these challenges, there is a need for a new approach that prioritizes decent work, social protection, and labour rights.

Persistent and Deep Inequalities

Income inequality has increased in many high-income countries and some middle-income countries like China and India, affecting two-thirds of the world’s population. However, some countries in Latin America, Africa, and Asia have seen a decline in inequality. The COVID-19 pandemic had varying effects, with some countries experiencing stable or decreased inequality due to fiscal support, while low-income countries saw increased poverty and likely inequality.

Wealth is increasingly concentrated among the top 1%, with the richest 1% owning more wealth than 95% of humanity. Ongoing transformations like technological advancements and climate change exacerbate inequality, and progress toward the 2030 Agenda’s goal of leaving no one behind has been slow, with many groups, including women and marginalized communities, still facing significant disparities and exclusion.

Social Cohesion at Risk: A Trust Deficit 

Social cohesion is crucial for community cooperation, collective action, and maintaining the rule of law, but it’s under threat due to growing polarization and declining trust in institutions and among people. Over half of the world’s population has little or no trust in their government, and trust is declining across generations. Differences in opinion and values are leading to negative perceptions and distrust, hindering cooperation and civic engagement.

The spread of misinformation and disinformation, facilitated by digital technologies and social media, is reinforcing divisions and fuelling distrust, with platform algorithms often radicalizing views and rewarding extreme content. Without action, this erosion of trust and social cohesion is likely to continue, posing significant risks to global stability and cooperation.

The Case for a New Policy Consensus

Societies are facing a breaking point due to growing economic insecurity, inequality, declining trust, and rising polarization, which have been building for decades. The rapid pace of globalization and technological change has brought benefits but also disrupted lives and deepened social divides. Policy choices prioritizing deregulation, privatization, and fiscal austerity have exacerbated inequality, weakened worker protections, and eroded trust in institutions.

To address these challenges, a new policy consensus is needed, focusing on strong social policies and a reorientation of policymaking through a social lens, with institutions and norms that foster trust and social cohesion, to create momentum towards achieving the Sustainable Development Goals (SDGs).

Embedding a Social Lens into Policymaking

Sustained social progress requires a whole-of-government approach and integrated policy solutions to address poverty, inequality, and climate change. Investing in people through social spending, improving access to quality public services, and providing adequate social protection are essential. Creating decent work opportunities, strengthening collective bargaining, and ensuring fair taxation are also crucial.

To achieve this, governments need to adopt a comprehensive framework, prioritize people-centred policies, and cooperate internationally to address global challenges, including debt relief and generating tax revenue, to support heavily indebted countries and ensure quality public services.

Institutions and Norms for Social Cohesion

Achieving sustained social progress requires a whole-of-government approach and a comprehensive policy framework. Coherent and integrated policy solutions are necessary to address global transformations, such as technological innovation and climate change, and to achieve goals like poverty eradication, inequality reduction, and decent work creation. Policy integration is critical to ensure that climate action prioritizes people in poverty and other disadvantaged groups, and helps build resilience against shocks.

Investing in people is essential for promoting equity and providing income security. This involves expanding access to quality public services, such as healthcare and education, and ensuring that social protection programs are available and adequate for those in need. Decent work is also crucial, requiring a focus on creating employment opportunities that provide fair wages, safe working conditions, and social protection. Strengthening collective bargaining and improving labour standards can help achieve this goal. Ensuring fair and progressive taxation is necessary to fund investments in people and achieve social goals.

Towards a New Policy Consensus: The Role of International Cooperation

The world is off track to achieve the SDGs by 2030 due to rising inequality, poverty, and insecurity, which are eroding the social fabric. The upcoming Second World Summit for Social Development offers a critical opportunity to promote equitable, resilient, and cohesive societies through concrete political steps and cooperation.

The summit can help mobilize actions to close gaps in access to essential services, promote decent work, and expand social protection coverage. Its success will depend on sustained efforts to turn commitments into reality, requiring stronger international cooperation and greater resolve in the face of geopolitical challenges.