Up to 75 million jobs at risk in travel and tourism sector due to coronavirus
World Travel & Tourism Council predicts $2.1tn loss to the world economy in 2020
As many as 75 million jobs are at immediate risk in the travel and tourism sector globally due to the Covid-19 pandemic, the World Travel & Tourism Council based in London said on Wednesday.
The organisation forecast that travel restrictions and other measures put in place to stop the spread of the pandemic will mean a $2.1 trillion (Dh7.71tn) hit to global GDP in terms of lost tourism revenue in 2020.
“The number of jobs now at risk in the global travel & tourism sector is a staggering 75 million, bringing real and profound worry to millions of families around the world,” said Gloria Guevara, WTTC president and chief executive.
“This chilling new figure also represents the collective delay by many governments around the world to react quickly enough to come to the aid of a sector which is the backbone of the global economy.”
The latest job risk figure is 50 per cent higher than the organisation’s previous estimate less than two weeks ago. As many as a million jobs are being lost in the travel and tourism sector every day, WTTC said last week.
Asia-Pacific is expected to be hardest hit, with up to 49 million jobs at risk throughout the region, representing a loss of nearly $800bn to travel and tourism GDP. In Europe, the figure is expected to be 10 million jobs, totalling a loss of nearly $552bn.
The Americas will also be struck hard by this crisis, with the US, Canada and Mexico expected to lose up to $570bn combined, with nearly seven million jobs at risk. Brazil, the UK, Italy, Germany, France, Japan, Indonesia and India were other countries named by WTTC where the problem could be severe.
“If urgent action is not taken within the next few days, the travel & tourism sector faces an economic meltdown from which it will struggle to recover and plunge millions of people dependent upon it for their livelihoods into debt,” she said.
“Not only will this have an enormous negative impact on major businesses in the travel and tourism sector around the world, the ‘domino effect’ will also result in massive job losses across the entire supply chain, hitting employees and those in self-employment.”
In Europe, Germany is set to be the most affected country with almost 1.6 million jobs at risk, followed by Russia with an estimated 1.1 million potential losses. Italy and the UK are each facing about a million lost jobs in the sector.
The Middle East, on the other hand, faces unemployment of about 1.8 million and a GDP drop of up to $65bn in the regional economy due to the global health crisis.
“We call on all those in positions of power to help the powerless and enact policies to support and sustain a sector which is a driving force of the global economy and responsible for generating one in five of all new jobs,” added Ms Guevara.
Travel and tourism, which contributes 10.4 per cent of the global GDP, is directly responsible for generating one in every 10 jobs, and has outpaced the growth of the world economy for eight successive years.
Worldwide, there are over 435,000 confirmed cases of Covid-19 with more than 19,500 deaths, according to Johns Hopkins University as of Wednesday. More than 111,000 have recovered.
The Covid-19 health crisis represents the biggest challenge to the global economy since the 2008 financial meltdown with at least $17tn having been wiped off stock markets in the past months.
Meanwhile, one in five jobs in the oilfield service industry could also be cut due to low project volumes brought on by the Covid-19 outbreak and the major fall in crude prices brought about by the battle for market share, according to Norwegian consultancy Rystad Energy.
It estimates that contractors will scale back their workforce by 21 per cent, meaning that more than a million jobs will be axed in an industry that employs about five million people. The shale sector is expected to be worst hit, as it was when oil prices previously collapsed in 2014-16.
“Low oil prices are likely to persist in 2021 and could lead to further workforce reductions. But as we move into the second half of 2021, with better market fundamentals and a fading Covid-19, recruitment is likely to pick up in the shale sector and from 2022 will also kick-off in the offshore sector,” said Audun Martinsen, Rystad Energy’s head of oilfield service research.
Updated: March 25, 2020 06:20 PM