Thousands have already lost their jobs due to the global credit crunch but those in the construction, automotive, tourism, services and real estate sectors will most likely bear the brunt of the financial storm, it said.

"This is not simply a crisis on Wall Street … this is a crisis on all streets"

Juan Somavia,
ILO director-general

The ILO also said that the population of those living on less than $1 a day could grow by 40 million while those on $2 a day could increase by more than 100 million.

Juan Somavia, the director-general of the ILO, said the new projections "could prove to be underestimates if the effects of the current economic contraction and looming recession are not quickly confronted".

"This is not simply a crisis on Wall Street … this is a crisis on all streets. We need an economic rescue plan for working families and the real economy, with rules and policies that deliver decent jobs," he said on Monday.

"I think that the most important thing is not to forget that the financial crisis is affecting real people in their life, in their life in the family and in the communities, it's affecting the real economy."

Social crisis

Somavia called for "prompt and coordinated government actions to avert a social crisis" saying he welcomed calls for "better financial regulation and a global surveillance system of checks and balances".

"We must return to the basic function of finance, which is to promote the real economy," he said, adding that the crisis offered an "opportunity" to re-balance globalisation which had grown "unfair, unsustainable and unbalanced".

The ILO, in identifying the poor as being especially vulnerable, cited a report on income inequalities it released last week to warn about the widening gap between rich and poor households.

Raymond Torres, director of the ILO's research arm which produced the "World of Work Report 2008", said that the income gap had widened since the 1990s.

"The present global financial crisis is bound to make matters worse unless long-term structural reforms are adopted," he said last Thursday.

Global unemployment currently stands at 6.1 per cent, but many countries are seeing the unemployment rate nudging up steadily.

On Monday Hong Kong said its jobless rate rose to 3.4 per cent for the three months to September, compared to 3.2 per cent in the three months to August.

Earlier this month the United States reported that it had lost 159,000 jobs in September.