AROUND 25 million workers are now at risk of losing their jobs from the pandemic novel coronavirus disease (Covid-19), which the International Labour Organization (ILO) has now tagged as a global “labor and market shock.”
Based on its projection of the impact of Covid-19 on global GDP, the ILO said the virus may cause unemployment to rise between 5.3 million (“low” scenario) and 24.7 million (“high” scenario) from a base level of 188 million in 2019.
The projected figure is higher compared to the global 22 million unemployment during the 2008-2009 global financial crisis.
“This [Covid-19] is no longer only a global health crisis, it is also a major labor market and economic crisis that is having a huge impact on people,” said ILO Director-General Guy Ryder.
With more unemployed workers, ILO estimates income losses for workers will reach $3.4 trillion by the end of 2020.
“This will translate into falls in consumption of goods and services, in turn affecting the prospects for businesses and economies,” ILO said.
Increased inequality
The labor arm of the United Nations also expects Covid-19 to increase the underemployment rate worldwide. As more countries enforce travel restrictions and quarantine measures because of the disease, the working hours and wages of many companies will be reduced.
“Following travel bans, border closures and quarantine measures, many workers cannot move to their places of work or carry out their jobs, which has knock-on effects on incomes, particularly for informal and casually employed workers,” ILO said in its “Covid-19 and World of Work: Impacts and Responses” reports.
ILO said people in less protected and low-paid jobs, particularly youth and older workers as well as women migrants, will be the most vulnerable to the “job crisis” caused by Covid-19.
“The latter are vulnerable due to the lack of social protection and rights, and women tend to be over-represented in low-paid jobs and affected sectors,” ILO said.
Impact review
Here in the Philippines, the growing number of Covid-19 cases, which already reached 202 as of March 18, will “definitely” cause it to review its projected labor impact of Covid-19.
Last month, the Department of Labor and Employment (DOLE) estimated the disease may lead to the displacement of 30,000 to 60,000 workers.
As of March 18, Labor Assistant Secretary officer in charge Dominique R. Tutay said 125 companies nationwide have implemented flexible work arrangement and temporary suspension of their operations due to Covid-19.
None of the 11,000 workers employed by these companies are considered permanently displaced for now.
Mitigating measures
To minimize the employment impact of Covid-19, ILO recommends protective measures at the workplace.
It also urged governments to introduce policies to protect employment and incomes of workers.
Such policies include unemployment benefits, social assistance, and public employment programs, employment retention schemes, and time-bound financial/tax relief and income smoothing measures to support business continuity.
“These measures not only cushion enterprises and workers against immediate employment and income losses, but they also help prevent a chain of supply shocks [e.g., losses in workers’ productivity capacities] and demand shocks [e.g., suppressing consumption among workers and their families] that could lead to a prolonged economic recession,” ILO said.
ILO cited the Philippines among the countries with such existing policies, particularly its new unemployment insurance benefit from the Social Security System.
Image credits: Nonie Reyes