Overcoming the employment crisis

The OECD has prepared the OECD Employment Outlook 2020: Worker Safety and the COVID-19 Crisis. The review examines the problem of unemployment as a consequence of the pandemic and provides recommendations.

The COVID-19 pandemic has caused one of the most serious employment crises. There is a risk that the crisis will lead to an increase in poverty and inequality, with consequences that will be felt for many years to come. Countries need to do everything possible to prevent the jobs crisis from turning into a social crisis.

Restoring a more sustainable labor market is an important investment in the future and in future generations. At the same time, at present, millions of people are losing their jobs: they are laid off or go to part-time work.

Note that in some countries, up to 10 times fewer hours were worked compared to the first months of the financial crisis in 2008.

By the end of 2020, unemployment in the OECD countries is projected to reach almost 10%, compared with 5.3% at the end of 2019, and will reach 12% in the event of a second wave of the pandemic.

Job recovery is expected no earlier than 2021.

To speed up this process, employers are already using job retention programs, reducing hours of work, while allowing workers to keep their wages and jobs.  

These include programs:

•    directly subsidizing unused hours, such as Kurzarbeit in Germany or Activitépartielle in France;
About 60 million people in OECD countries have been included in companies' applications for such programs.

Measures to support the labour market in terms of pandemia:

1. Support should be differentiated depending on the conditions of firms.

As the chart shows, most countries have already provided emergency support to all workers and should now do everything possible to support the most vulnerable while working to create more inclusive and sustainable labour markets.

Young people, women, and part-time, temporary, and self-employed workers are among the most at risk of unemployment and poverty. They tend to have less secure, unskilled jobs, and they are widely represented in the industries most affected by the crisis, such as tourism and restaurants.

2. Policy in the labour market should support efforts to prevent the second major wave of the pandemic and preparing for it.

 For many, remote work remains an effective way of working, limiting the risks of infection with the virus. Data presented in the employment survey shows that on average, about one-third of the work can be done from home under normal conditions. Remote work requires not only facilitating arrangements between employer and employee, but also investing to make sure that employees have the tools to work from home in good conditions (computer or tablet, broadband connection, etc.).

Almost two-thirds of the work is impossible or difficult to do from home. Some of them have a limited risk of infection because they are not associated with physical contact or are rarely associated with them (for example, plumbers, truck drivers). However, almost half of all jobs require frequent interaction and, in the absence of precautionary measures, involve a certain risk of infection of workers in the workplace. Therefore, the development and implementation of strict occupational safety and health standards remains a priority of the policy.

Moreover, maintaining long-term guarantees of paid sick leave will continue to be crucial to ensure that potentially infected workers do not spread the virus at work.