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Looking at unemployment protection, countries such as China, Japan, Korea, and Malaysia have established unemployment insurance schemes, while others rely on severance payments.
In 2023, the Asia Pacific region reached a milestone, with over half of its population (53.6%) covered by at least one social protection benefit, according to the International Labour Organization (ILO). However, social protection systems still face major challenges and need improvements to help combat the impacts of climate change.
The ILO’s World Social Protection Report 2024-26 reveals that while Asia Pacific’s coverage now surpasses the global average (52.4%), around 2.1bn people in the region remain without protection from lifecycle and socio-economic risks, and progress has been uneven across countries.
Challenges faced in the Asia Pacific region
According to the report, the social protection systems in Asia Pacific countries are facing recurrent and new transformative challenges, including significant and persistent informality, and non-standard forms of employment, such as platform work, globalised labour markets, rapid demographic ageing, technological development and emerging environmental challenges.
Climate change and just transition
- Policymakers must protect populations from extreme weather and slow-onset changes.
- Climate policies (e.g., reducing fossil fuel use) could affect energy/food prices and jobs in carbon-heavy industries.
- Social protection is essential to support people through these changes, and should be integrated into climate policies.
Social protection and adaptation
- Social protection can help people cope with climate change by safeguarding incomes, health, and jobs.
- Systems should be adaptable and prepared for climate-related shocks, like the Philippines' system for flood response.
Informal economy
- Informality (66% of workers) is the biggest barrier to extending social protection.
- Policies need to focus on gradually covering informal workers by tailoring benefits to their needs, like healthcare and cash benefits.
Demographic ageing
- Rapid population ageing in Asia Pacific will increase demand for healthcare, pensions, and long-term care.
- Traditional family-based care systems may struggle, highlighting the need for better public services.
Financing challenges
- Securing resources for social protection is key. Many countries in the region have room to raise taxes or contributions to fund these programmes.
- Economic pressures and high debt are challenges to achieving sustainable funding.
International labour migration
- Migrant workers face limited access to social protection.
- Social security agreements (like those pursued by the Philippines) help safeguard migrant workers' rights but need to be expanded.
Regional trends and outlook
Climate change vulnerability
- Asia Pacific is home to both major greenhouse gas emitters and countries with near-zero carbon footprints, making it a region with diverse climate impacts.
- The World Bank estimates that climate change could push 35.7mn people in the region into extreme poverty by 2030.
- Climate change will exacerbate existing inequalities and hinder progress toward the Sustainable Development Goals (SDGs).
Job losses due to global warming
- By 2030, heat stress caused by global warming is expected to result in the loss of 5.3% of working hours (43 million full-time jobs) in Southern Asia and 3.7% (13 million full-time jobs) in South-Eastern Asia.
- Excessive heat exposure affects 74.7% of workers in the region, with negative impacts on job quality and decent work opportunities.
Poverty and inequality
- In 2022, 883 million people in the region lived below the poverty line of $3.65 per day, and 209 million were in extreme poverty (below $2.15 per day).
- 72.5 million people were in extreme working poverty in 2023.
- Despite economic growth lifting millions out of poverty, inequalities have widened both within and across countries.
Social protection gaps
- Social protection systems in the region often provide limited coverage, with many workers in micro and small enterprises, the self-employed, and migrant workers being excluded.
- Contributory schemes are mostly limited to specific employee categories, while non-contributory schemes target only the poor and vulnerable.
Impact of financial crises
- Repeated financial and economic crises have emphasized the need for robust social protection systems to mitigate the effects on jobs and incomes.
- There is growing recognition of the link between social protection and inclusive economic growth, with more countries committing to building resilient social protection systems.
Low ratification of international standards
- Despite the importance of social protection, the region has low ratification of the Social Security (Minimum Standards) Convention, 1952 (No. 102), indicating room for improvement in adopting global social protection standards.
Despite some progress since 2015, many vulnerable countries face low effective coverage and limited preparedness for climate change impacts, with 16 out of the 50 most vulnerable countries located in the region. Specific countries, like Afghanistan and the Solomon Islands, exhibit especially low coverage rates.
Additionally, gender disparities persist, with women having 6.8p.p. less effective coverage than men. This gap is more pronounced in Southern Asia (11.1p.p.) due to factors such as lower labour force participation, higher informal employment, gender pay gaps, and unpaid care work.
Overall, while social protection policies have the potential to improve gender equality and women's rights, there remains a critical need for targeted improvements, particularly to address the unique challenges faced by women in the region.
Social protection for the various demographics
Children & families
The Asia Pacific region continues to grapple with significant child poverty, with 355.3mn children living in poverty, including 73.7mn in extreme poverty. Social protection measures, particularly child cash benefits, are crucial in addressing this issue by reducing poverty, improving health and education outcomes, and combating child labour. Despite their importance, coverage for these benefits remains low, increasing only modestly from 14.3% in 2015 to 22.4% in 2023.
Mongolia stands out by providing universal child coverage, while countries like Japan, Australia, and the Cook Islands offer near-universal benefits. In contrast, nations such as Thailand, Bangladesh, and Nepal have implemented partial or means-tested child benefits, with coverage levels varying significantly. Some countries, including Indonesia and the Philippines, have established conditional cash transfer programmes, though many still face challenges with low coverage and exclusion errors. Additionally, in-kind support programmes, such as India’s child food programme, attempt to meet children’s needs but lack the flexibility and empowerment advantages that cash benefits offer.
While progress has been made, considerable gaps remain in child protection throughout the region, highlighting the ongoing need for enhanced efforts to expand coverage and improve adequacy.
Women & men of working age
Maternity & paternity protection
Maternity and paternity protection is crucial for achieving gender equality. The Asia Pacific region has made progress, with cash maternity benefit coverage increasing from 25.8% in 2015 to 38.4% in 2023, slightly above the global average of 36.4%. Paternity protection is also steadily improving.
However, significant gaps in coverage and protection levels remain between countries. Some nations, like Australia, Mongolia, New Zealand, New Caledonia, and Niue, have achieved universal or near-universal maternity protection. Countries such as India and Myanmar have extended coverage to women in the informal sector through cash transfers during pregnancy and after birth. Vietnam recently expanded maternity benefits to informal workers through a state-funded voluntary social insurance scheme. Yet, in countries such as Afghanistan, Myanmar, and Nepal, less than 2% of women giving birth are covered.
Employment injury protection
In 2019, nearly 3mn people died from work-related accidents and diseases, while 395mn sustained non-fatal injuries globally (ILO 2023a). Employment injury benefits remain the oldest and most widespread social protection, with coverage in the Asia Pacific region increasing from 22.2% in 2015 to 28.5% in 2023, still below the global average of 37.4%.
Southern Asia struggles with coverage due to high informality and reliance on employer liability schemes. However, countries like Australia, China, and Korea have expanded benefits to include accident prevention and rehabilitation. In 2023, Korea extended insurance to platform workers, and China launched pilot programmes for platform workers. Bangladesh has also introduced a pilot scheme for garment workers, providing long-term benefits in cases of disability or death.
Unemployment protection
Unemployment protection includes income support, job placement services, and vocational training, crucial for helping workers transition to greener jobs in response to environmental policies. In the Asia Pacific, unemployment protection is underdeveloped, with only 12.8% of unemployed workers receiving benefits in 2023, below the global average of 16.7%.
Countries such as China, Japan, Korea, and Malaysia have established unemployment insurance schemes, while others rely on severance payments. Coverage for self-employed workers remains voluntary and limited, particularly in Southern Asia. Countries like Bangladesh, India, and Nepal offer public employment programmes, providing income security during climate-related events, but these often lack adequate support and decent work conditions. More efforts are needed to improve the quality of these programmes and extend protection to informal workers.
Social protection for persons with disabilities
Disability benefits are crucial for supporting persons with disabilities and promoting their societal participation. In the Asia Pacific region, access to these benefits rose from 18.9% in 2015 to 30.7% in 2023, still trailing the global average by 8.2 p.p.
Significant regional disparities exist, partly due to complex administrative procedures for disability assessment. A multi-disciplinary approach, combining benefits with vocational rehabilitation and flexible work arrangements, would help improve social inclusion and workforce reintegration for persons with disabilities.
Social protection for older women & men
Old-age protection
Old-age protection in the Asia Pacific region has seen broad coverage, with 76.6% of older persons accessing pensions or benefits in 2023, up from 68.4% in 2015, slightly below the global average of 79.6%. Despite high informality, 61.9% of the workforce contributes to pension systems, surpassing the global average of 58.5%.
The region shows diverse pension models: defined-benefit schemes in Eastern and South-Eastern Asia, universal flat-rate pensions in Australia and New Zealand, and national provident funds in countries like India and Malaysia. Countries like Japan and Korea focus on long-term sustainability, while Cambodia, Laos, and others work to expand coverage. Tax-funded social pensions are being implemented in several countries, including Bangladesh and Vietnam, to progressively extend coverage.
Social protection for vulnerable persons
Social assistance ensures a basic income for vulnerable individuals lacking sufficient social insurance coverage. In 2023, 34.5% of vulnerable populations in Asia Pacific received social assistance, below the global average of 37.3%. However, coverage is uneven across the region.
Targeting errors in narrowly focused social assistance programs often prevent aid from reaching those most in need. Broader, categorical universal benefits are seen as more inclusive and effective in reducing poverty. With climate change, adaptability in schemes and delivery mechanisms becomes increasingly important.
Social health protection
Long-term care for older persons
Long-term care encompasses health and social services for individuals needing assistance with daily activities due to disabilities, chronic conditions, or aging. These services can be provided in institutional, residential, or home settings with various funding models.
With the region's aging population and carer shortages, countries must ensure affordable, quality long-term care, secure the care workforce, and create fiscal strategies to fund these services. Japan and South Korea introduced long-term care insurance in the early 2020s, while China launched a pilot scheme in 2016, now covering 180mn people. Australia and New Zealand provide both residential and home care services through social welfare programmes.
Social protection systems
Establishing robust social protection systems is essential for addressing protection gaps and enhancing preparedness for climate crisis impacts. These systems can also help compensate those affected by climate policies, facilitating a fair transition.
To improve effectiveness, national social protection policies should incorporate evidence of the socio-economic effects of climate change and align with national climate strategies, such as Nationally Determined Contributions (NDCs) and National Adaptation Plans (NAPs). Additionally, climate policies should recognise the strategic role of social protection to maximise contributions to climate mitigation and adaptation.
Here are several examples of how social protection can facilitate a just transition and support climate change mitigation and adaptation efforts:
Enabling climate change mitigation and environmental protection
- Coordinating environmental and biodiversity protection policies with social protection and green employment services.
- Inserting a ‘social package’ of employment support into public transport modernisation projects.
- Protecting and enhancing carbon sinks through public works
- Reforming fossil fuel subsidies to create fiscal space for social protection
- Pension fund greening
- Payment for ecological services or eco-compensation
Supporting climate change adaptation by reducing vulnerability and enhancing resilience
- Enhancing responsiveness to shocks
- Temporary society-wide emergency support
- Simple modifications or enhancements of existing schemes and systems for extreme climate conditions
- Active labour market policies that promote climate resilience
- Health system strengthening and sickness benefits extension to protect against new health risks
- Supporting enterprises to maintain business continuity when climate shocks occur
- Taking into account climate risks in actuarial planning to ensure pension fund sustainability
As countries confront a rapidly aging population, it is essential to proactively ensure the long-term sustainability of their social protection systems, particularly in healthcare and pensions, while maintaining or improving benefit levels.
Amid the increasing impacts of climate change in the region, social protection plays a crucial role in supporting both adaptation and mitigation efforts, facilitating a just transition, and ultimately enhancing resilience for all, especially vulnerable communities.
To achieve this, social protection systems must be adapted to bolster resilience and effectively support climate adaptation and mitigation initiatives. Here are some recommended actions to consider:
- Integrate climate risk assessments into social protection programme design and implementation.
- Develop programmes addressing the needs of communities affected by climate change, including those impacted by extreme weather and sea-level rise.
- Promote sustainable livelihoods through support for green jobs and investment in sustainable agriculture.
- Strengthen capacity for disaster response with rapid response funds and mechanisms for immediate support.
- Utilise technology to improve the delivery and effectiveness of social protection in remote and vulnerable areas.
- Support community-based adaptation initiatives that empower local communities with climate-resilient strategies.
- Promote regional cooperation and knowledge sharing on climate-resilient social protection strategies.
READ MORE: How climate change is affecting the working world: Expected jobs to be created and displaced
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