A new report from the International Labour Organization has warned that the ongoing Middle East crisis could place increasing pressure on global labour markets, with rising energy prices, disrupted supply chains and weaker tourism activity expected to affect jobs and incomes worldwide.
According to the organisation, the impact of the conflict is likely to extend well beyond the region, influencing employment conditions through higher transport costs, reduced trade flows and uncertainty across key industries. The report noted that the consequences may continue to unfold over an extended period, particularly as the global economy remains vulnerable to slow growth and existing labour market challenges.
The ILO outlined a scenario in which oil prices rise by around 50% above their average levels recorded earlier in 2026. Under those conditions, global working hours could decline by 0.5% this year and 1.1% in 2027. The organisation said this would be equivalent to the loss of approximately 14 million full-time jobs in 2026 and 38 million in the following year.
Real labour income could also come under significant pressure, with projected declines of 1.1% in 2026 and 3% in 2027. Global unemployment is expected to increase more gradually, although the report highlighted that the impact would vary considerably between regions and sectors.
The Arab States and Asia-Pacific region were identified as particularly exposed because of their reliance on Gulf energy markets, regional trade routes and labour migration flows. In the Arab region, industries such as construction, transport, manufacturing and hospitality are considered especially vulnerable, with migrant workers likely to face disproportionate risks.
In Asia-Pacific economies, dependence on imported energy and remittance flows from Gulf countries is also creating growing concerns. The report noted that labour deployments to Gulf Cooperation Council countries have already slowed in several labour-exporting nations, while some countries are seeing early signs of weaker remittance inflows.
Sangheon Lee, Chief Economist at the ILO, said the crisis should not be viewed as a temporary disruption. He explained that external economic shocks often reach workers and businesses gradually, weakening employment conditions and putting pressure on decent work standards over time.
The organisation urged governments to introduce employment-focused policy measures to protect vulnerable workers, small businesses and migrant labour communities. It also called for stronger social dialogue and coordinated responses aimed at safeguarding incomes, working conditions and economic stability as the crisis evolves.
