The working poor contribute to, and benefit from, economic growth through labour markets and paid work, but employment generation has not featured significantly in the macroeconomic agenda. It was assumed that opening up economies to global competition and flexible labour markets would generate labour-intensive growth trajectories and secure livelihoods, leaving public measures for social protection restricted to those unable to earn their own living, but these predictions have not been borne out in practice.

Poverty rates have declined, yet globalisation has brought new insecurity. Labour market flexibility has increased labour force participation but the informal nature of these jobs mean they are precarious and badly paid, trapping some in chronic poverty.

Thinking on social protection, concerned about possible distortions of the labour market, has done little to stem the spread of informal employment. Despite policy commitment to poverty reduction through labour-intensive growth, the gains for the poor have been ambiguous. These themes were explored in a 2007 workshop convened by IDS and WIEGO.

Bringing together researchers, practitioners and policymakers, their contributions now make up this IDS Bulletin. Articles cover the changing nature of the global economy, flexible labour market policies in different regions of the world, conceptualisation of labour markets, implications for macroeconomic policies, and the scope for social protection. The conclusion is the need for a better understanding of the way labour markets function in the 'real' world if we are to find policies that will better deliver on the outcomes they promise.