Job creation should be put at the heart of the economic recovery plan as the negative impact of high unemployment is worsening, a report by the research arm of the International Labour Organization (ILO) said.
"New clouds have emerged on the employment horizon and the prospects have worsened significantly in many countries," the report said.
Without changes to current governments' policies, a recovery in jobless figures to pre-crisis levels would be delayed until 2015 in advanced economies, it said. The previous forecast of the ILO was 2013.
The rate of employment in both emerging and developing countries has returned to growth. But more than 8 million new jobs are still needed to reverse the damage caused by the economic crisis, it said.
The longer the economic slump continues without significant efforts from governments to boost job creation, the worse the problem will become, the report said.
"The longer the labor market recession, the greater the difficulties for jobseekers to obtain new employment," the report said.
"Nearly 40 percent of jobseekers have been without work for more than one year and therefore run significant risks of demoralization, loss of self-esteem and mental-health problems," the report said, citing data from 35 countries.
Young people are harder hit by unemployment, it added.
In a bid to stem the tide of the worsening outlook caused by the unemployment situation, the ILO had suggestions for what governments can do. It suggested strengthening "job-centered policies," along with introducing a less formal structure for matching skills to jobs.
The stimulus measures put in place to avert a deepening of the recession are gradually being withdrawn in many counties, which is adding to the negative jobs outlook, the report said.
And the fact that the root causes of the crisis have not been addressed is also worsening the problem, it said.
The report also warned against excessive private debt seen in many developed counties.
"The coexistence of private-debt-led growth in certain developed countries with export-led growth in large emerging economies has proved to be the Achilles’ heel of the world economy," it said.