Wednesday, January 27, 2021

UN Labor Agency: Pandemic Job Losses Four Times Higher Than After 2009 Financial Collapse

"This has been the most severe crisis for the world of work since the Great Depression of the 1930s. Its impact is far greater than that of the global financial crisis of 2009."


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People line up to receive food packages distributed in Budapest, Hungary

 on December 30, 2020. (Photo: Gergely Besenyei/AFP via Getty Images)

Surveying the widespread and devastating wreckage the coronavirus pandemic has inflicted on the world economy over the past nine months, the United Nations' labor agency estimated Monday that the Covid-19 crisis caused a loss of 8.8% of global working hours in 2020—the equivalent of 255 million full-time jobs.

That figure, according to the International Labor Organization's latest report (pdf), is approximately four times greater than the number of jobs lost during the 2009 global financial crisis, with the pain felt disproportionately by workers in the service industry and other typically low-wage sectors of the economy.

"This has been the most severe crisis for the world of work since the Great Depression of the 1930s," ILO Director General Guy Ryder told the Associated Press. "Its impact is far greater than that of the global financial crisis of 2009."

While expressing cautious optimism about the possibility of a strong recovery in the latter half of 2021 as vaccination efforts ramp up, the ILO report warns that "the global economy is still facing high levels of uncertainty and there is a risk that the recovery will be uneven" if governments don't provide sufficient support for those harmed by ongoing mass layoffs and the international community fails to assist developing nations.

"Inequality is likely to further increase as a result of the type of job losses generated by the crisis," the report states. "In the United States and the United Kingdom, for instance, significant job losses occurred at the lower end of the labor income distribution, while high-paid jobs were left largely intact."

"The crisis has had particularly devastating effects on many vulnerable population groups and sectors around the globe," the analysis continues. "Young people, women, the low‑paid, and low‑skilled workers have less potential to achieve recovery quickly, and the risk of long-term scarring and detachment from the labor market is all too real."

In order to facilitate a sustainable and equitable recovery from the pandemic—which has killed more than two million people across the globe—the report recommends:

  • Macroeconomic policies to remain accommodative in 2021 and beyond, including fiscal stimulus where possible, and measures to support incomes and promote investment;
  • Targeted measures to reach women, young people, low-skilled and low-paid workers, and other hard-hit groups;
  • International support for low and middle-income countries—which have fewer financial resources to roll out vaccines and promote economic and employment recovery;
  • Focusing support on the hardest-hit sectors while creating jobs in fast growing ones; and
  • Social dialogue to implement the recovery strategies necessary to create more inclusive, fair, sustainable economies.

"The signs of recovery we see are encouraging, but they are fragile and highly uncertain, and we must remember that no country or group can recover alone," Ryder said in a statement. "We are at a fork in the road. One path leads to an uneven, unsustainable, recovery with growing inequality and instability, and the prospect of more crises. The other focuses on a human-centered recovery for building back better, prioritizing employment, income and social protection, workers' rights, and social dialogue."

"If we want a lasting, sustainable, and inclusive recovery," Ryder said, "this is the path policymakers must commit to.”

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