The economic blow from COVID-19 has cost workers around the world $3.7tn (£2.7tn) in lost earnings, after the pandemic wiped out four times the number of working hours lost in the 2008 financial crisis, according to a report released by the ILO today.
The International Labor Organization (ILO) said women and younger workers had borne the brunt of job losses and reductions in hours. The ILO warned that people in sectors hardest hit by the crisis such as hospitality and retail risked being left behind when the economy recovered.
The seventh edition of ILO’s COVID-19 and the world of work report released on Monday, January 25, 2021, sounded an alarm that entrenched levels of inequality risked becoming a defining feature of the economic rebound from Covid-19.
The Geneva-based agency said that governments around the world needed to take urgent action to support those at the heart of the storm.
In its annual analysis of the global jobs market, it said 8.8% of working hours were lost in 2020 relative to the end of 2019, equivalent to 255million full-time jobs. This is approximately four times bigger than the toll on workers as a consequence of the 2008-2009 financial crisis.
These “massive losses” resulted in an 8.3% decline in global labor income, before government support measures are included, according to the ILO, equivalent to $3.7tn in earnings – about 4.4% of global GDP.
Women have been more affected than men by the disruption to the jobs market, with female workers more likely to drop out of work altogether and stop looking for a new job. Younger workers have also been particularly hard hit, either losing jobs, dropping out of the labor force, or delaying the search for a first job.
The ILO said there were some encouraging signs of recovery at the start of 2021, with the Covid-19 vaccine gradually being deployed around the world. However, it still estimated the continuing economic fallout would lead to a 3% loss of working hours globally in 2021 compared with the end of 2019, equivalent to 90m full-time jobs.
The ILO indicated that the number of workers living in countries with COVID‑19‑related workplace restrictions remained high at the start of 2021, with 93 percent of the world’s workers residing in countries with some form of workplace closures in place.
The report revealed that within countries, more geographically targeted and sector-specific measures have gradually become the norm throughout the pandemic. Thus, fewer than 3 percent of the world’s workers are currently living in countries with economy-wide required closures for all but essential workplaces, down from a peak of 41 percent in April 2020.
In a pessimistic scenario, which assumes slow progress on vaccination, working hours would fall by 4.6% this year, while on an optimistic path the world economy would still lose 1.3% of working hours. It said the outcome would depend on how well the pandemic was brought under control, and by how much consumer and business confidence recovered.
“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, this is the path policymakers must commit to” .
Guy Ryder, the director-general of the ILO
