Covid-19 effect on jobs: the occupations most at risk

The world of work is undergoing great change because of the coronavirus pandemic, leaving millions unemployed and others placed on furlough.

More people are working from home or waiting to restart their business when life returns to some form of normality.

But when people do get back to the workplace, what will it look like?

The McKinsey Global Institute, the research arm of management consultants McKinsey, released a report this week that tries to answer this question.

We expect the largest negative impact of the pandemic to fall on workers in food service and customer sales and service

Instead of considering types of jobs by sector, the company grouped 800 occupations according to how many interactions with other people they involved and assessed how they might be affected.

The report looked at eight countries accounting for half the world’s workforce – China, France, Germany, India, Japan, Spain, the UK and the US.

Here we look at the workplace changes that might be here to stay.

Which sector was hardest hit by coronavirus?

Up to 100 million workers – one in every 16 – in the eight countries featured are likely to have to look not just for new jobs, but new occupations.

In advanced economies, a quarter more people will have to change their field of work than predicted before the pandemic, with “a markedly different mix of occupations” emerging.

“We expect the largest negative impact of the pandemic to fall on workers in food service and customer sales and service roles, as well as less-skilled office support roles,” McKinsey said.

Meanwhile, there will be more warehousing and transport jobs, thanks in part to a growth in e-commerce. But this will not cancel out losses of other low-wage jobs.

McKinsey also forecasts a lasting increase in the number of independent workers – with the "gig economy" accounting for a greater share of the workforce.

Which jobs are most at risk during the pandemic?

On-site customer interaction
Leisure and travel
Computer-based office work
Indoor production and warehousing

McKinsey claims four types of close-proximity job – indoor production and warehousing, computerised office work, leisure and travel venues (which includes hotels and restaurants) and on-site customer interaction (including retail and hospitality) – are experiencing the most upheaval, in the short and long-term.

"Other work arenas, such as medical care and personal care with high levels of physical proximity, may also see less change because of the nature of the occupations," according to the report.

Tough times for sandwich shops

With more employees working from home, city centres are likely to face permanent reductions in the amount of trade, affecting sandwich shops, coffee shops and other outlets. There will also be less demand for transport services aimed at commuters.

McKinsey forecasts that the work-from-home trend will also have knock-on consequences on where people live and companies base themselves as they “shift out of large cities into suburbs and small cities”.

With face-to-face meetings no longer as important, thanks to the rise of video-conferencing, business travel is forecast to be one fifth lower than before the pandemic, which will hit the aviation industry hard, especially as, McKinsey notes, business travel is particularly lucrative.

What jobs will be lost to automation and artificial intelligence?

McKinsey reports that many companies stepped up investments in automation in factories, warehouses and call centres during the pandemic.

This was driven by increased demand in certain sectors and the need to reduce employee density to prevent coronavirus transmission.

Two thirds of senior executives polled by McKinsey in mid-2020 reported that they were investing more in AI and automation – a trend forecast to continue.

“Companies have enlisted automation and AI to cope with Covid-19 disruptions and may accelerate adoption in the years ahead, putting more robots in manufacturing plants and warehouses and adding self-service customer kiosks and service robots in customer interaction arenas,” the report said.

How many people will continue to work from home?

While the numbers working remotely may tail off once the effects of the pandemic wane, they are expected to remain much higher than before the coronavirus emerged.

McKinsey estimates that one fifth to one quarter of the workforce in the most advanced economies could work from home between three and five days a week.

“This represents four to five times more remote work than before the pandemic,” the company said.

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Gallery: UAE salary guide 2021

Ten tax points to be aware of in 2026

1. Domestic VAT refund amendments: request your refund within five years

If a business does not apply for the refund on time, they lose their credit.

2. E-invoicing in the UAE

Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.

3. More tax audits

Tax authorities are increasingly using data already available across multiple filings to identify audit risks.

4. More beneficial VAT and excise tax penalty regime

Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.

5. Greater emphasis on statutory audit

There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.

6. Further transfer pricing enforcement

Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.

7. Limited time periods for audits

Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.

8. Pillar 2 implementation

Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.

9. Reduced compliance obligations for imported goods and services

Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.

10. Substance and CbC reporting focus

Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.

Contributed by Thomas Vanhee and Hend Rashwan, Aurifer

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MATCH INFO

Champions League quarter-final, first leg

Tottenham Hotspur v Manchester City, Tuesday, 11pm (UAE)

Matches can be watched on BeIN Sports

World Cup final

Who: France v Croatia
When: Sunday, July 15, 7pm (UAE)
TV: Game will be shown live on BeIN Sports for viewers in the Mena region

Golden Shoe top five (as of March 1):

Harry Kane, Tottenham, Premier League, 24 goals, 48 points
Edinson Cavani, PSG, Ligue 1, 24 goals, 48 points
Ciro Immobile, Lazio, Serie A, 23 goals, 46 points
Mohamed Salah, Liverpool, Premier League, 23 goals, 46 points
Lionel Messi, Barcelona, La Liga, 22 goals, 44 points

UAE v Gibraltar

What: International friendly

When: 7pm kick off

Where: Rugby Park, Dubai Sports City

Admission: Free

Online: The match will be broadcast live on Dubai Exiles’ Facebook page

UAE squad: Lucas Waddington (Dubai Exiles), Gio Fourie (Exiles), Craig Nutt (Abu Dhabi Harlequins), Phil Brady (Harlequins), Daniel Perry (Dubai Hurricanes), Esekaia Dranibota (Harlequins), Matt Mills (Exiles), Jaen Botes (Exiles), Kristian Stinson (Exiles), Murray Reason (Abu Dhabi Saracens), Dave Knight (Hurricanes), Ross Samson (Jebel Ali Dragons), DuRandt Gerber (Exiles), Saki Naisau (Dragons), Andrew Powell (Hurricanes), Emosi Vacanau (Harlequins), Niko Volavola (Dragons), Matt Richards (Dragons), Luke Stevenson (Harlequins), Josh Ives (Dubai Sports City Eagles), Sean Stevens (Saracens), Thinus Steyn (Exiles)

LILO & STITCH

Starring: Sydney Elizebeth Agudong, Maia Kealoha, Chris Sanders

Director: Dean Fleischer Camp

Rating: 4.5/5

Packages which the US Secret Service said contained possible explosive devices were sent to:

Former first lady Hillary Clinton
Former US president Barack Obama
Philanthropist and businessman George Soros
Former CIA director John Brennan at CNN's New York bureau
Former Attorney General Eric Holder (delivered to former DNC chair Debbie Wasserman Schultz)
California Congresswoman Maxine Waters (two devices)