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5.3. Industrialisation and social sustainability:inclusiveness, productive employment andeducation policiesFigure 5-5. Multidimensional Poverty Index5.3.1. Inclusive economic growth and industrialisationOver the past decades, although global poverty has beenreduced, income inequality is rising, which is a source ofconcern in terms, among other things, of social tensionsand exclusion. Only about 10% of the total wealth in mostcountries is in the hands of the poorest half of thepopulation. 442The available evidence suggests that wage income fromindustrial employment has helped greatly in pulling largesections of the population out of poverty. 443 UNIDO offersevidence from successful developing countries suggestingthat economic growth and transformation triggered byindustrialization, international trade and related serviceshave contributed to poverty eradication and inequalityreduction. 444,445 (see Box 5-3).Box 5-3. Multidimensional poverty and industrializationThe Multidimensional Poverty Index (MPI) 446 depicted inFigure 5-5 reflects the prevalence of multidimensionaldeprivation at the household and individual level in health,education and standard of living. A person is considered“multi-dimensionally poor” if he or she suffers deprivationsin a third of the weighted indicators of the index. Accordingto UNDP, more than 30% of the populations in thecountries covered (corresponding to 75% of the worldtotal) experienced such a multitude of deprivationsbetween 2005 and 2012. The strong negative correlationbetween the MPI and the Competitive IndustrialPerformance Index (CIP) indicates that in countries withvery competitive industries, multidimensional poverty islow.Figure 5-6 depicts the relationship between inequalityadjustedincome levels and industrial development. Nocountry with a CIP value over 0.1 in 2012 had an inequalityadjusted income index value of less than 0.4 and only twocountries with a CIP below 0.01 surpassed this index value.Countries with the highest index value (i.e. theNetherlands, Switzerland, Belgium, and Germany,) are alsoranked in the top 10 on the CIP index. A high rankcorrelation is particularly visible in the bottom 10 rankedcountries in both indexes, which include Madagascar, theCentral African Republic, Nepal, Malawi, Niger, Rwanda,and Uganda.Figure 5-6. Inequality-adjusted Income IndexSource: Upadhyaya, Shyam and David Kepplinger (2014). 447However, the process of structural change associated withindustrialization can also cause job dislocations in somesectors. Thus, industrial policy and social policy should beclosely aligned to ensure the social protection ofdisadvantaged workers while economies undergo industrialtransformation. 448Box 5-4 describes how social policies were an importantelement in the inclusive convergence that took place inLatin America in the early 2000s. Moreover, educationalpolicies supporting industrial transformation and inclusivegrowth through training and capacity building (see Section5.3.3) are critical to accommodating the rising demand forskilled labour. 44995