It is widely accepted that the private sector is needed and better suited for sustaining rapid growth. And the Asian experience shows that growth is the most powerful weapon in the fight against poverty.
Growth creates jobs that use labor, the main asset of the poor.
As growth proceeds, private sector employment becomes the major source of economic support for the majority of workers and their families. Thus, improving labor market operations is an important element of strategies to promote pro-poor growth and reduce poverty. It also helps allocate a country s human capital resources to their most productive uses, enhancing general economic welfare, and encouraging further growth and development. Well-designed labor market policies help societies make growth more equitable by smoothing income fluctuations and broadening access to human capital development and employment opportunities. Thus, an integrated approach to the removal of distortions in different factor markets is essential for sustained success in the fight against poverty.