COVID-19: 25m Workers Worldwide May Lose $3.4trn
By Adedapo Adesanya
Global workers may lose over $3.4 trillion in income as the economic and labour crisis created by the COVID-19 pandemic could increase global unemployment by almost 25 million, a new assessment by the International Labour Organisation (ILO) has said.
The labour organisation in a preliminary assessment note titled COVID-19 and the world of work: impacts and responses looked at different scenarios for the impact of COVID-19 on global gross domestic product (GDP) growth.
ILO then estimated that there could be a rise in global unemployment between 5.3 million (low scenario) and 24.7 million (high scenario) from a base level of 188 million in 2019.
In the likelihood of a high scenario, it would surpass that of the 2008-2009 global financial crisis, which increased global unemployment by 22 million.
According to the Director General of the ILO, Mr Guy Ryder, “This is no longer only a global health crisis, it is also a major labour market and economic crisis that is having a huge impact on people.”
“In 2008, the world presented a united front to address the consequences of the global financial crisis, and the worst was averted. We need that kind of leadership and resolve now,” he added.
On the part of Mr Sangheon Lee, Director of the ILO’s employment policy department, the scale of temporary unemployment, lay-offs and the number of unemployment benefit claims were far higher than first expected.
“We are trying to factor in the temporary massive shock into our estimate modelling. The magnitude of fluctuation is much bigger than expected,” he said.
“We need to make downward adjustment, the projection will be much bigger, far higher than the 25 million we estimated,” he stated further.
ILO will, however, release another forecast next week as it calls for urgent, large-scale and coordinated measures including protecting workers in the workplace, stimulating the economy and employment, and supporting jobs and incomes in its assessment.
These measures include extending social protection, supporting employment retention (short-time work, paid leave, other subsidies), financial and tax relief, including for micro, small and medium enterprises.
In addition, the note proposes fiscal and monetary policy measures, and lending and financial support for specific economic sectors.