Almost 25 million jobs could be lost worldwide due to the coronavirus pandemic, according to a new study by the International Labour Organisation (ILO).
Based on different scenarios for the impact of Covid-19 on global gross domestic product, the ILO estimates indicate a rise in global unemployment of between 5.3 million in a low scenario and 24.7m in a high scenario from a base level of 188m in 2019. By comparison, the 2008-09 global financial crisis increased global unemployment by 22 million.
“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,” ILO director-general Guy Ryder said in a statement.
“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.
In its preliminary assessment report, titled Covid-19 and the world of work: Impacts and responses, the UN agency called for urgent, large-scale and coordinated measures across three pillars – protecting workers in the workplace, stimulating the economy and supporting jobs and incomes.
It said job losses could be lower if there is a coordinated global policy response.
Some of the measures outlined in the report include extending social protection, supporting employment retention through short-time work, paid leave, other subsidies and providing financial and tax relief for micro, small and medium-sized enterprises.
The ILO also proposed fiscal and monetary policy measures, and lending and financial support for specific economic sectors to reduce unemployment.
Underemployment is also expected to increase on a large scale, as the economic consequences of the virus outbreak translate into reductions in working hours and wages, according to the report.
Self-employment in developing countries is also expected to be impacted because of restrictions on the movement of people and goods, it said.
The fall in employment would result in income losses for workers estimated at between $860 billion (Dh3.16 trillion) and $3.4tn by the end of 2020, the report noted.
"This will translate into falls in consumption of goods and services, in turn affecting the prospects for businesses and economies."
Working poverty is also expected to increase significantly, as "the strain on incomes resulting from the decline in economic activity will devastate workers close to or below the poverty line".
The ILO estimates that between 8.8 million and 35 million more people will be in working poverty worldwide by the end of this year. It had initially projected a decline of 14 million.
The agency also warned that certain groups will be disproportionately affected by the jobs crisis, including people in less protected and low-paid jobs, particularly youth, older workers, women and migrants.
“In times of crisis like the current one, we have two key tools that can help mitigate the damage and restore public confidence,” Mr Ryder said.
“Firstly, social dialogue, engaging with workers and employers and their representatives, is vital for building public trust and support for the measures that we need to overcome this crisis.
“Secondly, international labour standards provide a tried-and-trusted foundation for policy responses that focus on a recovery that is sustainable and equitable. Everything needs to be done to minimise the damage to people at this difficult time.”
The coronavirus, the biggest challenge to the global economy since the 2008 financial crisis, has disrupted trade, the travel industry and rattled investors. At least $17tn has been wiped from stock markets worldwide.
The outbreak, which began in China, has now engulfed Europe and North America. Covid-19 has infected close to 220,000 people with nearly 9,000 deaths. More than 84,000 have recovered.