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Business News

COVID-19: 25 million will be jobless, as Recession looms

In the wake of the Coronavirus pandemic, the United Nations (UN) has warned that the world should prepare for a rise in unemployment. 

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Recession looms as UN, ILO declare 25 million will become jobless

In the wake of the Coronavirus pandemic, an agency of the United Nations (UN), International Labour Organization (ILO) has warned that the world should prepare for a rise in unemployment, as the evolving crisis could leave up to 25 million people jobless or underemployed.

The UN agency’s study suggested a “significant rise in unemployment and underemployment in the wake of the virus” as more people would lose their jobs and some would end up with ‘dramatically lower incomes’.

Recession looms as UN, ILO declare 25 million will become jobless

In a statement, ILO warned that the economic and labour crisis triggered by the spread of the new coronavirus, which has now infected over 200,000 people and killed more than 8,000 people worldwide, would have “far-reaching impacts on labour market outcomes.

“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 boss, Guy Ryder said in a statement.

[READ MORE: Coronavirus: Ogun State bans cinemas, night clubs, restaurants, others for 30 days)

According to him, the fresh studies considered different scenarios including a best-case scenario which pictures quick government intervention and high level of diplomatic coordination, and the best scenario showed a minimum of 5.3 million people rendered jobless by the crisis.

On the worse end, the crisis will see 24.7 million people become jobless, on top of the 188 million registered as unemployed in 2019.

Recession looms as UN, ILO declare 25 million will become jobless

The ILO warned that, “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 study, those engaged in self-employment will also experience a drastic drop in access to work, due to restrictions of movement. This could translate to large income losses for workers, “between $860 billion and $3.4 trillion by the end of 2020”.

“This will translate into falls in consumption of goods and services, in turn affecting the prospects for businesses and economies.” 

The number of people, who live in poverty despite holding one or more jobs, will also increase significantly, the study said, estimating that between 8.8 and 35 million more people will be added to the ranks of the working poor.

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It observed also that the decline in economic activities would devastate workers close to or below the poverty line, putting even more strain on their incomes.

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[READ ALSO: Coronavirus: CcHub offers fund, support to combat disease)

Recession looms as UN, ILO declare 25 million will become jobless

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The ILO called for urgent, large-scale and coordinated measures to protect workers in the workplace, stimulate the economy and employment and support jobs and income, including through social protection, paid leave and other subsidies.

The agency pointed out that some groups will be disproportionately impacted by the jobs crisis, including youth, older workers, women and migrants, in a way that could increase already soaring inequality, and the world needs the kind of leadership that would resolve these issues before they happen.

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Ruth Okwumbu has a MSc. and BSc. in Mass Communication from the University of Nigeria, Nsukka, and Delta state university respectively. Prior to her role as analyst at Nairametrics, she had a progressive six year writing career.As a Business Analyst with Narametrics, she focuses on profiles of top business executives, founders, startups and the drama surrounding their successes and challenges. You may contact her via [email protected]

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