COVID-19 and the world of work: Impact and policy responses

This briefing note contains the International Labour Organization’s preliminary assessment of the possible impacts of COVID-19 on the global workforce.  It proposes policy options to mitigate these impacts and enable steadfast recovery.

Highlights

• The COVID-19 pandemic has the potential to reach a large proportion of the global population.
• The crisis has already transformed into an economic and labour market shock, impacting not only supply (production of goods and services) but also demand (consumption and investment).
• Prospects for the economy and the quantity and quality of employment are deteriorating rapidly.
• Swift and coordinated policy responses are needed at national and global level, with strong multilateral leadership, to limit the direct health effects of COVID-19 on workers and their families, while mitigating the indirect economic fallout across the global economy.
• Deeper institutional and policy reforms are also required.
• Tripartite social dialogue between Governments and Workers’ and Employers’ organizations is a key tool for developing and implementing sustainable solutions, from the community level to the global level.
• COVID-19 will have far-reaching impacts on labour market outcomes.
• Initial ILO estimates point to a significant rise in unemployment and underemployment in the wake of the virus.
• Underemployment is also expected to increase on a large scale.
• The decline in economic activity and constraints on people’s movements is impacting both manufacturing and services.
• Underemployment is also expected to increase on a large scale.
• The decline in economic activity and constraints on people’s movements is impacting both manufacturing and services.
• Labour supply is declining because of quarantine measures and a fall in economic activity.
• Working poverty is also likely to increase significantly.
• Epidemics and economic crises can have a disproportionate impact on certain segments of the population, which can trigger worsening inequality.
• In times of crisis, International Labour Standards provide a strong foundation for key policy responses that focus on the crucial role of decent work in achieving a sustained and equitable recovery.
• Policy responses should focus on two immediate goals: Health protection measures and economic support on both the demand- and supply-side.
• Pro-active, large-scale and integrated measures across all policy areas are necessary to make strong and sustained impacts.
• Building confidence through trust and dialogue is crucial in making policy measures effective.

Contents

• Current situation: Why are labour markets important?
• Impacts: How will COVID-19 affect the world of work?
• Responses: what are the key policies that will mitigate the impacts of COVID-19 on the world of work?
• Countries in action: How have countries been responding?
• Annex I: Estimating the impact of COVID-19 on the world of work
• Annex II: Lessons from the past: Some key learnings relevant to this crisis

This document was originally published on the ILO website.