The Strategist

Labor market is experiencing the largest crisis since World War II

04/08/2020 - 03:54

The International Labor Organization (ILO) has stated that the labor market is facing the worst crisis since World War II due to the COVID-19 coronavirus pandemic. Quarantine measures led to the fact that temporary full or partial closures of enterprises affected 2.7 billion people, that is, 81% of the total workforce in the world. The most affected are the hotel business, administrative services, industrial production, wholesale and retail trade.

“The pandemic is already having a catastrophic effect on the world labor market,” the ILO report reads. Experts note that at the moment a temporary cessation of the full or partial operation of enterprises has affected 2.7 billion people - or 81% of the total workforce in the world, amounting to 3.3 billion people. As the quarantine measures continue, the ILO expects to see a reduction of 6.7% of the total number of working hours worldwide in the second quarter, which is equivalent to 195 million full-time workers.

Most of all working hours will be reduced in the Arab countries - 8.1%. This is equivalent to 5 million full-time jobs. Europe is on second place (–7.8% of working hours, 12 million full-time workers), and Asia-Pacific Region (APR) is on third place (–7.2%, 125 million people).

“Employees and businesses are facing a real catastrophe - both in developed and developing countries,” said Guy Ryder, ILO Director General. “We all need to act quickly and decisively together.” If we take urgent and appropriate measures, we can make it so that the difference between collapse and survival will be noticeable. "

ILO experts note that approximately 1.25 billion people are employed in industries at high risk of job cuts or job losses. Most of these people are in low-paying jobs, so the consequences of the cuts will be especially sensitive for them.

The expanded version of the report states that the least risk of cuts is threatened by industries such as education, health, utilities, agriculture, public service, and public safety. Medium risk is indicated for the labor market in the field of construction, financial and insurance services. Above average risk is facing the labor markets in the fields of art and entertainment, transportation services, hotel and tourism business, real estate trade, industrial production, wholesale and retail trade, car repair services.

In the aviation industry alone, experts from the International Air Transport Association (IATA) expect a reduction of 25 million jobs due to a sharp decrease in air traffic intensity amid a pandemic. IATA report notes that most of the jobs in the airline industry could be lost in the Asia-Pacific region - 11.2 million, Europe in second place - 5.6 million, and Latin America in the third - 2.9 million.


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