Impact of COVID-19 on Employment
Article Contributed by Mr. Rajat Mehrotra, Assistant Professor, Faculty of Commerce and Business Administration.
Covid-19 is a Worldwide epidemic which started from Wuhan City in China, the day it started as per the WHO records is 21st Dec 2019 and has now spread to over 210 countries. This is a virus with no history of previous symptoms and in turn is having no medicine to cure it. The confirmed cases as of now are 2,557,993. This virus named Covid-19 is not only destroying the human being by increasing the number of deaths but also destroying the World economies at a large scale. The impact of this virus is such that all the major economies of the World- The USA, UK, China, India, Italy, Spain, Australia, Germany, France are lockdown fully or partially. The exports & import are no more taking place, the airports, the schools, shopping malls, religious places, offices, transport everything is standstill. The comeback of life to normal is still uncertain with weak GDP numbers and other financials being presented by different financial bodies. This pandemic is a World wide one which unlikely from the disturbance in financial institutions in 2008 but Covid-19 will be a Health emergency being occurred in majority parts of the World including India and is increasing rapidly making the economy to standstill. The stock markets are a major indicator of Financial health of any country and with a sharp decline of 39% in just 63 days from peak to bottom is an indicator that the World is about to enter in the recession. Although the Recession is cyclical in nature and not structured and will end but when this will be a question of major Concern across the globe. Economists Worldwide are hoping for a V shaped recovery after the crisis which means that a quick upward movement will be drawn after a steep downward trend.
Now the major question which is troubling the World in terms of making economic activity churning is of unemployment, reason being that when the World is in lockdown stage and there is no immediate sign of opening so the question comes in mind? Will the economy work the same as pre-Covid -19 period so the answer is NO. There are many changes the World economy is facing in terms of employment and the nature of duties being performed World over. From being a globalized economy, the World will become a close (Limited) economy. The export and import will be affected in a way that after this massive blow to all the World economies they rather than exporting will first have to make the inhouse economy meet the demand with supply.
The US which is the largest economy of World is facing the heat and data from Federal Reserve states that already 20 million people have filed for unemployment, the economy is estimated to grow at -2.3% FY 2020-21, the consumer durables demand in US stay low and the scarcity will increase the poor by 3.4%. As far as the global airline industry is concerned it will be badly impacted and is 91% down fleet and it will take 3 years and more to reach the present levels, the realty sector is hitting badly with a demand supply gap widen with a percentage of 56% and the sector is major contributor of employment. 49% new jobs will be less created in next 3 years. The Covid-19 in near term will definitely hamper the sectors like tourism till the spread of Covid-19 should not stop. The hotel and restaurants pre -Covid-19 are also working in online ordering this is 47% of order book now it will improve. One more important thing to know that all previous crisis is time bound and will give a World some new discovery like the previous SARS pandemic gave birth to online shopping and started ALIBABA to go aggressively towards it.
This pandemic too will give more focus to digitalized platforms to be used in different sectors like education where – Byjus, Udemy, Edx, Coursera, Unacademy are present, digital payments we have amazon, payu, paypal, paytm, wallets, travel reservation we have Visa, Mastercard, wallets, etc. Now these players will become more matured when it comes to providing services to different customers not only in India but round the globe. This pandemic will also give World new ways of working right now since the schools and colleges are closed, the businesses and factories, GYMs, Cinema halls are closed. The introduction of digital classes where its education, cooking, fitness etc. will be introduced in great numbers which will also serve the purpose of social distancing and will make the recovery soon. No pandemic is everlasting so I would suggest to start improving and work towards your individual passion and companies and factories should also collectively work with IT and make the use of digital platform in great numbers. With this I end and wish that WORLD will recover soon.
Sources: – World bank, WHO, Federal Reserve, RBI