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CodeAspire > Blog > Impact of Covid-19 on the Job market

  • CodeAspire
  • May 10, 2020

Impact of Covid-19 on the Job market

The impact of Covid-19 on the Job market

The virus originated from the city of Wuhan, China has taken life of lakhs of people. All over the world more than 3.73 million of people have been affected. The impact of Covid-19 has not only affected people but also country economic. One of the crisis created by the Covid-19 pandemic is economic and labour crisis that increases global unemployment by almost 25 million.

According to ILO  "However, if we see an internationally coordinated policy response, as happened in the global financial crisis of 2008/9, then the impact on global unemployment could be significantly lower," it added.

A staggering 16.8 million Americans lost their jobs in just three weeks, a measure of how fast the coronavirus has brought world economies to their knees. This has lead to development of tension among people.

About 1.5 crore people face job losses in India's export sector following the cancellation of over half of the orders and a gloomy forecast for global trade due to the Covid-19 pandemic, exporters' body Federation of Indian Export Organisations said on Friday.

The current nationwide lockdown has been the biggest job destroyer ever in the history. It is assumed that these loss of job during this period should not be considered as  permanent loss of livelihood. As many of them may get their job back when everything are lined up or when everything is on the track. However, it is true that many of them would also not be able to get their jobs back, such as informal workers who involved in casual or contractual work and those who returned to their villages .

Seeking immediate announcement of a relief package for exports, FIEO President Sharad Kumar Saraf said a fine balancing is required between life and livelihood, as opting for only one can be disastrous for the country. He said that exporters are left with "very" few orders and if factories are not allowed to work with a minimum workforce, many of them will suffer "irreparable losses" which will bring them to the brink of closure as they are saddled with a fixed cost that in any case has to be absorbed by them.

"With the cancellation of over 50 percent of orders and a gloomy forecast for the future, we expect 1.5 crore job losses in exports and rising non-performing assets amongst exporting units, hitting the economy very badly," Saraf said. He also said that sectors including apparel, gems, and jewellery, leather, handicrafts and engineering are severely hit by the lockdown.

We are losing markets to China. All orders are going to China as they have resumed work. It will be very late if we will not start our factories now. Small economies like Bangladesh and Sri Lanka to have announced relief packages.

Later he recommended steps like interest-free working capital term loans to exporters to cover the cost of wages, rental, and utilities; employee provident funds and Employees' State Insurance Corporation's waiver for three months from March to May; extension of pre and post-shipment credit by 90-180 days on their maturity, and extension of interest.

What does planets say

The period from 2008-09 also saw India’s growth rate witnessing a sharp decline from 7.8 percent in the first half of 2008-09 to 5.8 percent in the first half of 2008-09. This time, in 2020-21, the Indian economy will see a slowdown in the short term; will revive strongly post November 2020.  However, there are strong indications of unrest on account of job cuts since a weak Jupiter in the zodiac is detrimental for job retention prospects.