U.N. On the world of work and covid-19

• 

  Policy Brief:

  The World of Work

  and COVID-19

  JUNE 2020

  U

  NDER STRICT EMBARGO UNTIL 04:00

  GMT (06:00 CEST) on Friday 19 June 2020
• 

  

  This brief was produced with the

  support of a number United Nations entities,

  led by the International Labor Organization.

  Copyright is retained by the United Nations.
• 

  THE WORLD OF WORK AND COVID-19 1

  EXECUTIVE SUMMARY........................................................................................2

  1. GLOBAL CONTEXT: THE WORLD OF WORK BEFORE COVID-19 ..................5

  2. THE IMPACT OF COVID-19 ON THE WORLD OF WORK ...............................7

  3. POLICY RECOMMENDATIONS ...................................................................15

  CONCLUSION .....................................................................................................24

  Table of Contents
• 

  2 THE WORLD OF WORK AND COVID-19

  The COVID-19 pandemic has turned the world

  of work upside down. It is having a dramatic

  effect on the jobs, livelihoods and well-being

  of workers and their families and on enter-

  prises across the globe, particularly the small

  and medium sized. While certain sectors and

  industries have successfully moved online,

  pointing the way towards exciting innovations

  in the world of work, millions of workers have

  lost their livelihoods and many more – espe-

  cially women who are concentrated in highly

  exposed sectors – remain at risk. As with so

  many aspects of this pandemic, the impacts

  are falling disproportionately on those who

  were already in precarious circumstances and

  who can least absorb the additional blow.

  Measures necessary to mitigate the impacts

  of the COVID-19 virus have had signicant

  knock-on effects on societies and econo-

  mies. By mid-May 94 percent of the world’s

  workers were living in countries with some

  type of workplace closure measures in place.

  1

  Massive losses in working hours which are

  equivalent to 305 million full-time jobs are

  predicted for the 2nd quarter 2020, while 38

  percent of the workforce – some 1.25 billion

  workers – is employed in high-risk sectors.

  2

  The impacts of these developments vary consid-

  erably between groups of people and countries,

  depending to a large extent on pre-existing

  inequalities and government interventions.

  Those toiling in the informal economy – often

  without rights at work and social protections –

  suffered a sixty percent decline in earnings in

  the rst month of the crisis alone. Young people

  account for more than four in ten employed

  globally in hard-hit sectors. Combined with

  disruptions in education and training, this

  places them at risk of becoming a ‘lockdown

  generation’ that will carry the impacts of this

  crisis with them for a long time. Women are dis-

  proportionately employed in critically affected

  sectors such as service, hospitality, tourism and

  are also impacted by the shifting of economic

  activity into the domestic sphere, where they

  carry the majority of increasing levels of unpaid

  care work.

  3

  Small and medium-sized enterprises

  – the engine of the global economy – are suf-

  fering immensely and many may not recover. As

  is the case for the entire crisis, those living in

  developing countries and fragile contexts face

  the most dramatic risks or have least resilience.

  The near-term prognosis is worrisome. Many

  of those people who have lost their jobs and

  their livelihoods in recent months will not be

  able to re-enter labour markets any time soon.

  This is particularly the case for women, who

  may be disproportionately amongst the rst

  out and the last to return, due to gender dis-

  crimination and precarious working conditions,

  Executive Summary
• 

  THE WORLD OF WORK AND COVID-19 3

  including low wages, increased care burdens

  and opportunity costs of working, especially

  given the gender pay gap, as well as existing

  obstacles to the formal economy. Persons with

  disabilities, already facing exclusion in employ-

  ment, are also more likely to experience greater

  diculties returning to work during recovery.

  The long-term impacts are also of concern.

  These challenges will have a severe impact on

  efforts to reduce poverty and inequality, put-

  ting SDG achievement further at risk. They also

  risk adding fuel to an already burning re of

  discontent and anxiety in the world of work.

  Despite its promises, globalization – perhaps

  the most dening feature of the world economy

  over the last several decades - and has not

  always beneted all people and economies. In

  many countries, income inequality has been

  rising steeply since the 1980s. The global labour

  income share was 51.4 percent in 2017, down

  from 53.7 percent in 2014, while the remaining

  capital share increased

  4

  . Before the crisis hit,

  7.1% of the world’s workers were living in extreme

  poverty

  5

  . Women were almost half as likely to

  be employed as men and were overrepresented

  in low-paid, unprotected jobs. 267 million young

  people were not in employment, education or

  training

  6

  . 107 countries excluded workers from

  the right to establish or join a trade union.

  7

  At the same time, the current crisis shows how

  much economies and labour markets depend

  on each other. This interdependence should

  be redened going forward to generate a

  more inclusive and sustainable world for all.

  COVID-19 also accelerated certain trends, par-

  ticularly digitization and the move to remote

  work, in some cases auguring a promising

  future of greater exibility and sustainability.

  But fears also grew regarding the downsides

  of imminent effects of new technologies on

  the future of work, as new technological inno-

  vations underpinning the Fourth Industrial

  Revolution, such as network technology, Big

  Data, 3-D printing, articial intelligence and

  robotics, transform the very nature of work

  and risk deepening gaps and inequalities.

  In the face of all these trends, there is

  a risk that massive unemployment and

  loss of income from COVID-19 could fur-

  ther erode social cohesion and destabilize

  countries in both the North and the South,

  socially, politically and economically.

  Policy Responses

  This policy brief presents the stark conse-

  quences of COVID-19 in an already precarious

  world of work and provides practical options

  to recover better. The pandemic is causing

  immense pain, suffering and anxiety for peo-

  ple across the world. Workers and business

  owners face a particularly uncertain future. But

  with smart timely action at all levels, a focus

  on decent and productive employment, and the

  2030 Agenda as our compass, we can emerge

  from this crisis stronger, together, with better

  jobs and a more equal and greener future. To

  minimize the impact of this crisis on workers

  and businesses, governments, partners and

  international organizations have taken a range

  of bold measures. Over 170 countries, for

  example, have allocated a total of $9 trillion to

  scal stimulus plans. Building on these steps

  and in order to accelerate the transition to a

  more inclusive, and sustainable and resilient

  world, large-scale and proactive policy actions

  should be pursued in the following three areas.
• 

  4 THE WORLD OF WORK AND COVID-19

  1. PROVIDE IMMEDIATE SUPPORT FOR AT-RISK

  WORKERS, ENTERPRISES, JOBS

  AND INCOMES

  Urgent steps are required in the short-term to

  avoid enterprise closures, job losses and income

  decline and mitigate the shift in work and labour

  into the domestic sphere. Interventions should

  build on existing institutions, while steering

  workers and enterprises towards sustainable

  development for a better and stronger recovery.

  2. ENSURE A COMPREHENSIVE APPROACH

  TO RETURNING TO WORK

  Combatting the pandemic and restarting the

  economy are not competing priorities. On the

  contrary, they must go together. Returning to

  work does not mean giving up on protecting

  the health of workers or forgoing hard-won

  gains to supress the spread of the virus. And

  protecting health does not mean keeping enter-

  prises and economic activity locked down.

  Policies should ensure that both happens at

  the same time. A holistic view will be needed

  as key decisions are taken. For instance,

  decisions on reopening schools should con-

  sider prospects on care provision that will

  likely hamper women’s return to work.

  3. CREATING DECENT AND PRODUCTIVE

  JOBS FOR A GREEN, INCLUSIVE,

  AND RESILIENT RECOVERY

  The world of work will not and should not

  look the same after this crisis. The fragilities

  and fault lines exposed by the crisis need to

  be tackled. What is needed is a coordinated

  global, regional and national effort to cre-

  ate decent and productive jobs for all as the

  foundation of a green, inclusive and resilient

  recovery. In doing so, demographic shifts

  in ageing societies as well as the transition

  towards climate neutral economies, which saw

  increased support from wide parts of societies

  before the crisis began, need to be considered.

  Decisions taken now will have dramatic impli-

  cations for current and future generations.
• 

  THE WORLD OF WORK AND COVID-19 5

  The world of work before COVID-19 was rid-

  dled with inequalities and problems.

  9

  Only 57

  percent of people of working age (3.3 billion

  people, 1.3 billion women and 2,0 billion men)

  were employed. 188 million were unemployed

  10

  .

  The majority of those with a job worked in

  the informal economy, most without rights at

  work, without social protection and earning

  low wages that trapped them in poverty. For

  instance, more than 85 percent of African work-

  ers were informally employed and informality

  was also the reality for the majority of people

  in Asia, Latin America and the Middle East.

  Informal employment was particularly high

  among women (62 percent), and dominant in

  agriculture and services. Skills mismatches

  1. Global Context:

  The world of work before COVID-19

  8

  FIGURE 1: GLOBAL LABOUR MARKET INDICATORS BEFORE COVID-19

  Working-age population: 5.7 billion

  Youth working-age population (15-24 years): 1.2 billion

  Note: Persons in time-related underemployment are employed persons whose working time is insucient in relation to a more desirable

  employment situation in which they are willing and available to engage. The potential labour force consists of people who were actively seeking

  employment, were not available to start work in the reference week, but would become available within a short subsequent period (unavailable

  jobseekers), or who were not actively seeking employment but wanted to work and were available in the reference week (available potential

  jobseekers). Young people in employment may simultaneously be in education or training.

  Source: ILOSTAT, ILO modelled estimates, November 2019.

  Employed: 3.3 billion (57%)

  2 billion informal (35%) 1.3 billion formal (22%)

  Time-related

  Underemployment:

  165 million (35%)

  Youth in employment:

  429 million (36%)

  Youth in education or training (not employed):

  509 million (42%)

  Youth not in employment,

  education or training:

  267 million (22%)

  Unemployed:

  188 million (40%)

  Potential

  labour force:

  119 million (25%)

  Total labour

  underutilization:

  473 million

  Out of labour force: 2.3 billion (39%)
• 

  6 THE WORLD OF WORK AND COVID-19

  were a common challenge all over the world.

  Involuntary temporary and part-time work, as

  well as new forms of work, were on the rise, lead-

  ing to a feeling of increased insecurity amongst

  workers and enterprises, especially micro, small

  and medium sized enterprises (MSMEs).

  Some groups of the population were par-

  ticularly disadvantaged and the next chap-

  ter elborates on how those groups have

  been further affected by COVID-19.

  For example, youth unemployment rates

  were about 3 times as high as those of adults

  before the crisis hit.

  11

  More than three out of

  four of the world’s young workers had informal

  jobs prior to the onset of the crisis compared

  with 60 per cent of adults aged 25 and above.

  And around one-fth of young people world-

  wide, or 267 million young people, were not

  in employment, education or training (NEET).

  This gure reached almost 40% for young

  women in lower-middle income countries.

  12

  Persons with disabilities faced signicant

  exclusions in all areas of the world of work

  before the crisis: the employment-to-population

  ratio of persons with disabilities aged 15 and

  older was almost half that of persons without

  disabilities. Employed persons with disabilities

  tended to earn lower wages than their counter-

  parts without disabilities. Lack of accessible

  workplaces and reasonable accommodation

  posed further obstacles in the employment

  of persons with disabilities. In most countries

  social protection systems offer little support

  to persons with disabilities and their fami-

  lies – only 28% of persons with signicant

  disabilities have access to disability benets

  globally, and only 1% in low-income countries.
• 

  THE WORLD OF WORK AND COVID-19 7

  Policymakers responded decisively to COVID-19

  with necessary measures to slow the spread

  of the virus and to save and protect lives.

  Lockdowns and other restrictive measures

  to contain the pandemic have had a devas-

  tating impact on already weak labour mar-

  kets, as well as production and consumption.

  Altogether 94 percent of the world’s workers

  are living in countries with some type of work-

  place closure measures in place (gure 2).

  Trade, foreign direct investment, and global

  supply chains are being interrupted with dire

  effects for production processes and associated

  2. The impact of COVID-19 on the

  world of work

  FIGURE 2: EMPLOYMENT IN COUNTRIES WITH WORKPLACE CLOSURES

  0%

  01-Jan 09-Jan 17-Jan 25-Jan 02-Feb 10-Feb 18-Feb 26-Feb 05-Mar 13-Mar 21-Mar 29-Mar 06-Apr 14-Apr 22-Apr 30-Apr 08-May 16-May

  10%

  20%

  30%

  40%

  50%

  60%

  70%

  80%

  90%

  100%

  The shares of employed in countries with required workplace closures for some sectors or categories of workers and recommended workplace

  closures are stacked with that of those in countries with required workplace closures for all but essential workplaces.

  Source: International Labour Organization (ILO) COVID-19 Monitor, 4th Edition, 27 May 2020

  Share of the world’s employed living in countries with required workplace closures for all but essential workplaces

  Share of the world’s employed living in countries with recommended workplace closures

  Share of the world’s employed living in countries with required workplace closures for some sectors or categories of workers
• 

  8 THE WORLD OF WORK AND COVID-19

  jobs. Where social protection systems were

  weak or absent, millions of people have been

  left without an income. Unemployment is

  already skyrocketing in many countries and

  hours worked in all countries and regions are

  estimated by the ILO to have fallen dramat-

  ically by 10.7 percent in the second quarter

  of 2020 relative to the last quarter of 2019,

  which is equivalent to 305 million full-time

  jobs (assuming a 48-hour working week).

  13

  The pandemic has exposed inequalities and

  social ssures in societies that are hitting hard

  the most vulnerable and marginalized groups.

  14

  As a result, multidimensional poverty and

  inequality are likely to increase signicantly.

  15

  Revised estimates from the World Bank sug-

  gest that the number of people living in poverty

  could increase by 70-100 million, which would

  be the rst increase in poverty since 1998, from

  632 million people in 2019.

  16

  The number of

  those remaining poor even though they work

  is estimated to increase by up to 35 million.

  17

  Sectoral risks

  Globally, around 38 percent of the workforce

  – some 1.25 billion workers - is employed in

  high-risk sectors (table 2). These sectors are

  Estimated percentage drop in aggregate working hours compared to the pre-crisis baseline

  (4th quarter 2019, seasonally adjusted)

  World

  1st quarter 2020 2nd quarter 2020

  1st quarter 2020 2nd quarter 2020

  1st quarter 2020 2nd quarter 2020

  Lower-middle income countries

  Upper-middle income countries

  High-income countries

  Africa

  Americas

  Arab States

  Asia and the Pacic

  Europe and the Central Asia

  Lower-income countries

  FIGURE 3. DROP IN WORKING HOURS IN THE FIRST

  AND SECOND QUARTERS OF 2020 IS SEVERE

  4.8% 10.7%

  8.8%

  11.4%

  9.9%

  12.2%

  9.5%

  13.1%

  10.3%

  10.0%

  12.9%

  1.7%

  1.7%

  1.7%

  1.9%

  2.1%

  8.8%

  6.5%

  3.0%

  2.3%

  Source: International Labour Organization (ILO) COVID-19 Monitor, 4th Edition, 27 May 2020
• 

  THE WORLD OF WORK AND COVID-19 9

  Economic sector

  Current

  impact of

  crisis on

  economic

  output

  Baseline employment situation

  (global estimates for 2020 prior to COVID-19)

  Level of

  employment

  (000s)

  Share in

  global

  employment

  (percent)

  Wage ratio (av.

  monthly sector

  earnings/av. total

  earnings)

  Share of

  women

  (percent)

  Education Low 176560 5.3 1.23 61.8

  Human health and social work

  activities

  Low 136244 4.1 1.14 70.4

  Public administration and

  defence; compulsory social

  security

  Low 144241 4.3 1.35 31.5

  Utilities Low 26589 0.8 1.07 18.8

  Agriculture; forestry and shing

  Low-

  Medium*

  880373 26.5 0.72 37.1

  Construction Medium 257041 7.7 1.03 7.3

  Financial and insurance

  activities

  Medium 52237 1.6 1.72 47.1

  Mining and quarrying Medium 21714 0.7 1.46 15.1

  Arts, entertainment and

  recreation, and other services

  Medium-

  high*

  179857 5.4 0.69 57.2

  Transport; storage and

  communication

  Medium-

  high*

  204217 6.1 1.19 14.3

  Accommodation and food service High 143661 4.3 0.71 54.1

  Real estate; business and

  administrative activities

  High 156878 4.7 0.97 38.2

  Manufacturing High 463091 13.9 0.95 38.7

  Wholesale and retail trade;

  repair of motor vehicles and

  motorcycles

  High 481951 14.5 0.86 43.6

  TABLE 1: WORKERS AT RISK: SECTORAL PERSPECTIVE

  Source: International Labour Organization (ILO) Monitor: COVID-19 and the world of work, 3rd Edition, 29 April 2020. * - denotes sectors that include

  sub-sectors that have been affected in different ways. For example, parts of manufacturing have been hit hard (e.g. automobile industry in Europe), while

  other segments less so.
• 

  10 THE WORLD OF WORK AND COVID-19

  labour intensive and employ millions of often

  low-paid, low-skilled workers. Workers in the four

  sectors that have experienced the most “drastic”

  labour market effects of the disease and fall-

  ing production are: food and accommodation

  (144 million workers), retail and wholesale (482

  million); business services and administration

  (157 million); and manufacturing (463 million).

  Tourism-related activities make a large con-

  tribution to GDP and employment in many

  regions. Directly or indirectly, tourism activities

  provide about 10 percent of all employment

  18

  .

  Since the onset of the COVID-19 crisis, inter-

  national tourism has practically stopped.

  The majority of the workforce is employed in

  MSMEs, which have been disproportionately

  FIGURE 4: GENDER DIFFERENCES REGARDING THE IMPACT

  OF THE CRISIS IN THE INFORMAL ECONOMY

  World High risk

  sectors

  Medium-high

  risk sectors

  Medium risk

  sectors

  Low-medium

  risk sectors

  Low risk

  Signicantly

  impacted

  Men 32 12 16 39 2

  Women 42 11 2 40 4

  High income

  countries

  High risk

  sectors

  Medium-high

  risk sectors

  Medium risk

  sectors

  Low-medium

  risk sectors

  Low risk

  Signicantly

  impacted

  Men 47 17 23 7 6

  Women 51 18 5 5 22

  Upper middle

  income countries

  High risk

  sectors

  Medium-high

  risk sectors

  Medium risk

  sectors

  Low-medium

  risk sectors

  Low risk

  Signicantly

  impacted

  Men 39 13 17 29 2

  Women 56 14 2 25 4

  Lower middle

  income countries

  High risk

  sectors

  Medium-high

  risk sectors

  Medium risk

  sectors

  Low-medium

  risk sectors

  Low risk

  Signicantly

  impacted

  Men 31 12 15 40 2

  Women 37 9 3 49 3

  Low income

  countries

  High risk

  sectors

  Medium-high

  risk sectors

  Medium risk

  sectors

  Low-medium

  risk sectors

  Low risk

  Signicantly

  impacted

  Men 17 7 8 67 1

  Women 28 10 2 60 1

  Source: International Labour Organization (ILO) Monitor: COVID-19 and the world of work, 3rd Edition, 29 April 2020
• 

  THE WORLD OF WORK AND COVID-19 11

  affected.

  19

  Across the world, women make up

  most workers in the tourism industry, espe-

  cially in the low-wage part of this sector.

  Table 1 and gure 4 only classify sectors by the

  current risk (meaning the early phases of this

  crisis). However, over time some of the sectors

  will see an increased risk. Agriculture for exam-

  ple provides livelihoods to more than one billion

  people worldwide and remains the backbone

  of many low-income countries, accounting for

  60.4 percent of employment and contributing

  up to two-thirds of gross domestic product in

  some countries. This sector risks losing jobs

  and livelihoods due to longer-term disruptions in

  trade and supply chains with devastating impact

  on already high poverty rates in rural areas

  20

  .

  In terms of occupational health risks, the hard-

  est-hit workers are all those who are involved in

  essential production and services sectors that

  continue to work, often without the necessary

  social distancing, protective equipment and

  other OSH related measures. These frontline

  workers deserve special attention from gov-

  ernments to ensure maximum protection.

  Informal economy

  workers hit hardest

  21

  Informal economy workers are particularly vul-

  nerable to lockdown measures. Their earnings

  in the rst month of the crisis are estimated to

  have declined by 60 percent globally (around 80

  percent in Africa and Latin America). The rate of

  relative poverty, which is dened as the propor-

  tion of workers with monthly earnings that fall

  below 50 percent of the median earnings in the

  population, is expected to increase by almost 34

  percentage points globally for informal workers.

  These massive income impacts among informal

  workers should be seen along with their greater

  exposure to health and safety risks as their work

  involves strong interaction with co-workers

  or customers, while lacking adequate protec-

  tion, such as masks or hand disinfectants.

  Moreover, in many developing countries, MSMEs

  also operate predominantly in the informal

  sector. Given the diculties of their formal-

  ization through business registration in the

  best of times, many MSMEs will not be able to

  access assistance packages during the crisis.

  Care work

  Workers in care sectors, between 60 and 70

  percent of which are women, are a particularly

  vulnerable group of workers, with low wages,

  often informally employed and with little rec-

  ognition.

  22

  Many of them have had work cease

  or were particularly vulnerable to health risks

  (e.g., care workers for older people as keep-

  ing a physical distance is not possible).

  Unpaid care work, where women performed

  more than three times as much as men before

  the crisis, has increased during the pandemic

  lockdowns, further constraining women’s access

  to employment and impacting physical and

  mental health stressors. In addition, female

  care workers who try to combine the addi-

  tional duties at home with the request for long

  shifts at work have to carry a disproportioned

  part of the societal burden of this crisis.

  23

  Enterprises at risk

  The effect of the crisis on micro, small and

  medium enterprises is especially severe because

  of higher levels of vulnerability and lower resil-

  ience related to their size. Over 50 percent of

  small and medium enterprises in OECD coun-

  tries could fail over the next few months

  24

  . A
• 

  12 THE WORLD OF WORK AND COVID-19

  widespread collapse of MSMEs that are the

  economic backbones and main job providers

  in many countries will have a strong impact on

  national economies and global growth pros-

  pects, on perceptions and expectations, and

  even on the nancial sector, which may already

  be under strain as a result of non-performing

  portfolios. In some countries, a deterioration of

  the nancial situation of MSMEs could have sys-

  temic effects on the banking sector as a whole.

  25

  Approximately 47 million employers, some 54

  percent of all employers worldwide, operate

  businesses in the hardest-hit sectors of manu-

  facturing, accommodation and food services,

  wholesale and retail trade and real estate and

  business activities

  26

  which account for more

  than 30 percent of GDP on average.

  27

  An addi-

  tional 389 million own-account workers are

  engaged in these four sectors. Taking together

  employers and own-account workers, some

  436 million enterprises worldwide are operat-

  ing and working in the hardest-hit sectors

  28

  .

  While small economic units around the globe

  play a major role as providers of jobs, particu-

  larly in low and middle-income countries,

  29

  and

  particularly for women,

  30

  they often lack access

  to credit, have few assets and are the least likely

  to benet from scal measures in general and

  the current crisis related stimulus packages.

  Hardest-hit groups

  In addition to the impacts associated with

  unpaid care work outlined above, women are

  overrepresented in the service sectors hit by the

  pandemic, such as retail, accommodation and

  food services, and domestic work. On the whole,

  almost half of all pre-crisis women workers are

  at high risk of being hit by the crisis. This dis-

  advantage is unique to the COVID-19 crisis and

  attributable to the concentration of women in

  service provision sectors, which are hardest-hit

  by lockdown measures. This is particularly

  the case in Northern America and in Europe,

  where more women than men are employed in

  at-risk sectors. Emergency and recovery meas-

  ures should take these gures into account.

  Young people are affected disproportionally

  during any crisis and even more so during the

  current crisis. Before the onset of the COVID-

  19 pandemic, 178 million youth around the

  world, or more than 4 out of every 10 young

  persons employed globally, were working in

  wholesale and retail trade, manufacturing,

  accommodation and food services and other

  services, including real estate, which have been

  hit hard by the crisis. Education and training of

  youth has been severely disrupted

  31

  . The latest

  labour force data reveals that unemployment

  for young people, particularly young women,

  has increased more and at a faster pace than

  for prime-age adults. Due to these effects, the

  risk of a “lock-down generation” is high. Some

  economic policy responses – such as scal

  and monetary policies, bailouts and tax relief,

  mortgage freezes, waivers of interests on stu-

  dent and business loans – are not designed to

  address the particular needs of young people.

  The virus is not just threatening the lives and

  safety of older persons, but it is also threatening

  their social networks, their access to health ser-

  vices, their pensions and their jobs.

  32

  The income

  and employment impacts will be large given

  that, at a global level, the share of older persons

  in the labour force has increased by almost 10

  percentage points in the past three decades

  33

  .

  This increase was often the result of economic

  necessity, particularly since less than 20 percent

  of older persons of retirement age receive a pen-

  sion in many developing countries, so losing this

  option will lead to increases in old-age poverty

  34

  .
• 

  THE WORLD OF WORK AND COVID-19 13

  Refugees and migrant workers have been

  particularly affected by the economic conse-

  quences of the virus. They tend to be concen-

  trated in sectors with high levels of temporary,

  informal or unprotected work characterised by

  low wages and lack of social protection, includ-

  ing in care work.

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  For many migrants, losing

  their jobs not only has direct implications for

  their own income situation but will also lead

  to declines in remittances. Getting their jobs

  back will be further hindered through the loss

  of visas, work or residence permits and renew-

  als.

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  Refugees, meanwhile, often struggle with

  legal access to labour markets, inclusion in

  national social protection responses, access

  to nancial service and credits, and freedom of

  movement. For many refugees, loss of income

  has led to an inability to meet basic needs.

  There are over 67 million domestic workers

  worldwide, 75 percent of whom are working

  informally, 80 percent are migrants and the

  vast majority are women. These workers play

  a key role in ensuring the health and safety of

  the families and households for which they

  work, from cleaning ad cooking, to caring for

  children, the ill and the elderly. Their physical

  proximity to the families in their care put them

  at an elevated risk of exposure to COVID-19.

  This risk is compounded when they care for

  the ill, have long commutes on public trans-

  portation, or work for multiple households.

  If they become ill, many domestic workers

  do not have access to health care, sickness

  benets or employment injury benets.

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  Labour market vulnerabilities are worsening for

  many other groups, including persons with dis-

  abilities, indigenous peoples and members of

  disadvantaged ethnic groups, refugees, inter-

  nally displaced people, smallholder farmers

  and others. New business models, such as the

  platform and gig economy with non-standard

  employment relationships or alternative work

  arrangements, also tend to be characterized by

  reduced benets and protection for workers.

  The massive number of low-skilled-low-wage

  workers also carry a higher risk of being hit

  by the crisis. Data is scarce but reports from

  different sources, and evidence and experi-

  ence from past crises leave no doubt that the

  impact on all of them will be devastating.

  Risks ahead

  The economic shock of this crisis, with

  impacts on both the supply and demand

  sides of economies, is not just a question

  of a short-term disruption of growth pat-

  terns but rather risks becoming an unprec-

  edented global economic contraction, with

  devastating impacts on employment.

  The translation from the short-term impact

  towards a long-term economic recession is the

  result of a vicious spiral (gure 5) that kicks

  in when measures taken to retain jobs are

  not quick and big enough, with consequently

  high un- and under-employment. As a result,

  economies will be faced with reductions in

  consumption (through lower labour income)

  and production. Extended unemployment will

  also have a long-lasting impact on labour sup-

  ply through losses in workers’ capabilities.

  All this will further suppress aggregate

  demand and supply, with a severe negative

  impact on poverty and inequality and possible

  consequences for social cohesion (evident

  in some cases where debates about recov-

  ery have become divisive). We have seen in

  many developing countries that poverty and

  environmental degradation come together.