COVID 19 Impact – The Future of Employment in India and the World
When the industrial revolution began in the 18th century, the world witnessed dramatic changes to how people worked and lived. The future was uncertain and something new. Before this point in history, a person could easily predict how their life would be. It would be the same as generations before them. Contrastingly, during the first couple of months of 2020, businesses could predict how the financial year would be. They made forecasts and predictions for spending, hiring, growth, losses, etc. based on the performance from previous years. However, when Covid 19 hit the world, shutting down everything in its path, the effect was felt everywhere. People were confined to their homes and businesses and factories closed their doors. The worldwide Covid 19 lockdown left millions of people jobless, from every sector, as hotels, retail outlets, restaurants, factories, manufacturing plants, airlines etc. all shut down.
Covid 19 Impact on Employment Around the World
According to the International Labour Organization (ILO), at the start of the year, the worldwide unemployment rate was already at 190 million. Post the COVID 19 lockdown, the impact on employees and businesses around the world are going to be devastating. According to the most recent report released by the ILO, businesses and workers in hospitality, manufacturing retail and real estate will be the worse hit. Around 1.25 billion workers work in these sectors, globally. Many of them are low paid and labor-intensive workers.
Another sector that causes concern globally is the informal economy which consists of an alarming 2 billion workers. This large group of workers are mainly in emerging and developing countries. They are daily wage workers who live hand to mouth, have no protection, no access to healthcare, and have no financial backup if they stop working. The employment impact of COVID 19 on the informal workers is going to push them further into poverty. Starvation, lack of hygiene and healthcare makes this group more prone to contracting the virus and spreading it quickly, thus prolonging the lockdown period even further. This will make it more difficult for them to re-enter the workforce to re-earn their livelihoods.
To combat these alarming unemployment numbers in the global workforce, experts agree that governments across every country must make coordinated efforts to stimulate the economy, provide healthcare, support incomes and protect the workers and their jobs. Additionally, offering financial and tax relief to small and medium enterprises will help reduce the unemployment numbers post the COVID 19 lockdown. Governments and businesses will need clear communication to build trust in order to combat and overcome this economic crisis. Only when consumption of goods and services increases, will the economy will stabilize.
Covid 19 Impact on Employment in India
The impact of COVID 19 on employment in India mirrors that of the rest of the world. Manufacturing, automotive, agriculture and tourism will take a big hit this year post the COVID 19 pandemic. Entry level jobs for graduates may be postponed. There may also be cuts in high salary jobs, as companies try to cut costs wherever possible. Also, sectors that rely heavily on supply chains, such as manufacturing, agriculture, construction etc. will also face severe losses due to the global lockdown.
One sector that many experts fear will be severely impacted is the travel and tourism industry. The hospitality industry (travel, retail, accommodation, tourism) relies heavily on people visiting from around the world to sustain itself. With borders closed nationally and internationally, trust has been damaged. People are weary of stepping out of their homes, cities, state and country. Flights have been grounded, hotels empty, restaurants and retail outlets closed, which leaves the millions of employees working in these sectors jobless and with no salary. While the government has asked businesses to take care of their workers, many workers are facing the harsh reality of financial struggles with little or no savings to help them ride out this crisis.
Impact on Travel and Tourism
According to the United National World of Tourism Organization, (UNWTO), the tourism industry is in a crisis as never seen before and it will lead to severe unemployment in this sector with millions of jobs being cut post the COVID 19 lockdown. With national and international borders closed, the travel and tourism industry in India, similar to other countries, has also come to a complete halt. Experts believe it may take up to six months for the economy to start to recover. But the tourism industry will take much longer, as it is suspected that people will be weary of both national and international travel.
Aviation Sector
The aviation sector was already struggling before the COVID 19 pandemic. Many flights are leased and monthly dues have to paid whether they are grounded or in the air. With the lockdown in place, many airlines have no option but to cut their workforce to manage expenses with no incoming revenue. Airlines around the world and in India have announced salary cuts for a majority of its workforce. While other airlines are asking employees to take an unpaid leave of absence.
Post COVID-19 lockdown, the new social distancing regulations might mean that airlines will be forced to run at half capacity, which will lead to airlines increasing prices, thereby increasing the cost of travel. With millions of people around the world facing financial difficulties travelling will not be a luxury that will be affordable for some time.
When the ability to travel is compromised, the impact is felt in all related sectors, such as hotels, restaurants, taxi services, tour operators etc. Across the country both budget and luxury hotels have been shut down and employees sent home. As, the hotel industry is seasonal and relies on peak travel seasons to make most of its revenue, they have already lost on this year’s potential revenue. This has and will put millions of people out of a job. Even when the world COVID 19 pandemic ends, hiring will not resume immediately and will be slow. When people around the world feel safe and can afford to travel, then all sectors in the tourism industry will be able to afford the workforce pre-COVID 19 lockdown.
Impact of Employment in the Informal Economy
Another sector that employs millions of people across the nation is the day to day workers, which is roughly about 400 million workers in India. This includes people working in agriculture, construction, etc. who are all now being pushed further into poverty. While the industries that hires this group of people may not feel the impact yet, the losses will be felt in the coming months. For example, loss in supply chain management and loss of transportation for migrant workers in agriculture could mean heavy food shortages for the coming year, leading to a rise in prices. This will put more pressure on people across the country, who will still be recovering financially from the global pandemic.
The Silver Lining
While millions of workers across several industries face uncertain futures, there are some sectors that will not only continue to thrive but experience growth also. People working in education, e-commerce, healthcare and pharmaceuticals will not be severely impacted. We might even see a rise in employment for healthcare workers and in wellness centers. Online shopping retailers, such as Amazon, are among the few that have already increased its workforce, to meet with the demands of consumers during the lockdown. And when the crisis is over, it is expected that people may prefer to shop online to maintain social distancing. Additionally, breaks in international supply chain management could lead to people consuming more local products, giving rise once again to local businesses and small employment opportunities in this sector.
This is a new world we are currently in. Nothing like this has ever happened before in history because we are a global village today and as such, a pandemic of this scale affects workers at all levels in every country. Governments are working to help revive the economy with stimulus packages and creating financial and tax reliefs for businesses, but the government can only do so much.
Businesses of all sizes will have to do their part also to assess and determine how to work in the post COVID-19 world. New plans for reviving growth, working with reduced staff, increasing job opportunities will need to be carefully planned and executed. It is suspected that more people will work as freelancers and on contractual basis, in sectors where it is possible, as companies will look at reducing costs. This could lead to the world seeing an emergence of a large work at home workforce. Red Bixbite the best staffing solutions Pune India can help you save time and money by finding the employees you need in the post COVID 19 world.