In News
- Global unemployment is projected to stand at 207 million in 2022. This is 21 million more than in 2019 before the novel coronavirus disease (COVID-19) pandemic began, according to the ILO World Employment and Social Outlook – Trends 2022.
About
- Status of Global working hours in 2022: This will be almost two per cent below their pre-pandemic level that is equivalent to the loss of 52 million full-time jobs.
- Global labour force: It is estimated that in 2022 around 40 million people will no longer be participating in the global labour force.
- The Outlook remains fragile because the future path of the pandemic remains uncertain: Also, wider economic risks such as accelerating inflation may come into play.
- Labour market prospects are uneven across the globe.
- Many low and middle-income countries have low access to vaccines and limited scope to expand government budgets to address the crisis.
- Thus, these countries are struggling more than high-income ones to get back to pre-pandemic levels of employment and job quality.
- All regions face severe downside risks to their labour market recovery that stem from the ongoing impact of the pandemic.
- The outlook is the most negative for Latin America and the Caribbean and for Southeast Asia.
Overall Issues
- The pandemic has pushed millions of children into poverty: It is estimated that in 2020, an additional 30 million adults fell into extreme poverty while being out of paid work.
- The number of extreme working poor: workers who do not earn enough through their work to keep themselves and their families above the poverty line rose by eight million.
- Some sectors: Such as travel and tourism have been particularly hard hit, while other sectors such as those related to information technology have thrived.
- Women have been worse hit by the labour market crisis than men and this is likely to continue. The closing of education and training institutions will have long-term implications for young people, particularly those without internet access.
Indian Scenario
- Impact on organized sector’s jobs: Urban employment is a proxy for better paying jobs and a decline in these numbers reflects impact on better-paying organized sector’s jobs.
- Low consumption levels: With Covid-19 cases on the rise amid the threat posed by the Omicron variant and many states imposing fresh curbs, economic activity and consumption levels have been affected.
- $5-trillion target: None of this portends well for the economy or the $5-trillion target set by the government, unless it can course-correct and creates more jobs.
- Job security: Indians, however, worry about unemployment with concerns around job security topping their list.
- Ripple effect: The impact of unemployment can be felt by both the workers and the national economy and can cause a ripple effect.
- Suffer financial hardship: Unemployment causes workers to suffer financial hardship that impacts families, relationships, and communities. When it happens, consumer spending, which is one of an economy’s key drivers of growth, goes down, leading to a recession or even a depression when left unaddressed.
Way Forward
- Many temporary workers lost their jobs at the start of the crisis: However, many new temporary jobs have also been created since.
- There is the need for a broad-based labour market recovery: the recovery must be human-centered, inclusive, sustainable and resilient.
- There can be no real recovery from this pandemic without a broad-based labour market recovery: And to be sustainable, this recovery must be based on the principles of decent work including health and safety, equity, social protection and social dialogue.
- A Change in the pattern of investment: The planning process in the initial stages gave importance to an investment-allocation pattern with a high capital-labour ratio. Therefore, a shift in the emphasis to mass consumer goods industries would generate more employment to absorb the unemployed labour force.
- Encouragement to small enterprises as against big enterprises: The employment objective and the output objective can be achieved, if greater investment is directed to small enterprises rather than to large enterprises.
Source: DTE
