The coronavirus crisis may push 40 crore Indians working in the informal sector further into poverty. The International Labour Organization (ILO) in its report titled ‘ILO Monitor 2nd edition: COVID-19 and the world of work’, says the pandemic is likely to wipe out 19.5 crore full time jobs or 6.7% of working hours globally in the second half of the year. It said that the COVID-19 pandemic is affecting 2.7 billion workers globally due to lockdowns.
Describing the coronavirus pandemic as "the worst global crisis since World War II", the report says about 40 crore workers in India working in the informal economy are at risk of falling deeper into poverty.
“In India, with a share of almost 90 per cent of people working in the informal economy, about 400 million workers or 40 crore in the informal economy are at risk of falling deeper into poverty during the crisis. Current lockdown measures in India, which are at the high end of the University of Oxford's COVID-19 Government Response Stringency Index, have impacted these workers significantly, forcing many of them to return to rural areas,” ILO said.
"In India, Nigeria and Brazil, the number of workers in the informal economy affected by the lockdown and other containment measures is substantial," ILO said.
In India, to bring back the economy and to ensure minimum impact on informal sector due to coronavirus, the Government has asked all public and private companies to ensure that they do not cut salaries of their staff or resort to layoffs of their employees amid the lockdowns. Besides, it has transferred Rs 1.75 lakh crore to “80 crore poorest Indians” through direct benefit transfer (DBT) under the Pradhan Mantri Garib Kalyan Yojana (PMGKY) over three months starting April 1. The Centre for Monitoring Indian Economy’s weekly tracker survey indicates that the coronavirus effect may have left a devastating impact on the economy, sending urban unemployment rate soaring to 30.9%. Overall unemployment has risen to 23.4%.
The report said the disruption to the world's economies caused by the COVID-19 pandemic is expected to wipe out 6.7 per cent of working hours globally in the second quarter of this year – the equivalent of 195 million jobs worldwide. Worldwide, two billion people work in the informal sector (mostly in emerging and developing economies) and are particularly at risk, the report said, adding that the COVID-19 crisis is already affecting tens of millions of informal workers.
Large reductions are foreseen in the Arab States (8.1 per cent, equivalent to 5 million full-time workers), Europe (7.8 per cent, or 12 million full-time workers) and Asia and the Pacific (7.2 per cent, 125 million full-time workers), it said. Huge losses are expected across different income groups but especially in upper-middle income countries (7.0 per cent, 100 million full-time workers), far exceeding the effects of the 2008-9 financial crisis, the report warned. "The COVID-19 pandemic is having a catastrophic effect on working hours and earnings, globally," it said.
More than four out of five people (81 per cent) in the global workforce of 3.3 billion are currently affected by full or partial workplace closures, it said. Employment contraction has already begun on a large (often unprecedented) scale in many countries. In the absence of other data, changes in working hours, which reflect both layoffs and other temporary reductions in working time, give a better picture about the dire reality of the current labour market situation.
