The impact of Covid-19 on the world of work … winners and losers

By Samir Allal – The pandemic has hit all countries and everywhere, it has hit the most vulnerable populations harder. In the short term, the consequences of this health and economic crisis are negative. Even if changes can foreshadow more positive trends.
Discussions about the future of the world of work were already in the public debate before the current health crisis. Its evolution will depend on four fundamental variables: technology, demography, climate change and globalization.

It is generally accepted that the effects of these variables can be both positive and negative. There will be winners and losers (and among these will undoubtedly be a large share of underqualified jobs, low-income households and disadvantaged groups especially in developing countries).

It was in this context that the pandemic was triggered, with significant consequences for the health of millions of people and – through the lockdowns that followed – on the global economy.

Recent advances in terms of vaccinations give hope that the crisis will end in 2021. This is why the questions relating to its impact on the variables mentioned above are becoming more and more pressing, especially in a context where the majority of governments are committed to creating a more inclusive, sustainable and fairer future.

Colossal losses in working time and income

In the short term, the consequences of the pandemic are almost entirely negative and universal. Since almost all countries have been affected. The first phase of the crisis, in early 2020, was characterized by a wave of business closures, colossal losses in working time and income, increases in unemployment and poverty around the world.

In all countries, the hardest hit were groups that were already disadvantaged before the crisis: low-skilled workers, young people, the elderly, women, migrants, the disabled, etc.

Globally, the number of working hours lost in the first quarter of 2020 (compared to the first quarter of 2019) is estimated by the ILO at 5.6%, or 160 million full-time jobs of 48 hours per week . In the second half of the year, this figure climbed to 12.1% (345 million jobs).

Past crises have shown that the more inactive people are, the more difficult it is for them to find a place in the labor market.

Three positive trends

The situation is uneven from one country to another and the picture may not be as bleak as it looks. The changes, which are taking place in three areas shaken by the crisis, could lead, in the medium and long term, to more positive trends:

1. The acceleration of teleworking

Remote working is not a new phenomenon, but the pandemic has led to its massive development. This could cause long-term changes in many areas, starting with the organization and location of work.

Surveys carried out in many countries indicate that the majority of employees consider teleworking to be a positive experience. Among the reasons given: more flexibility, a better work / life balance and less time spent in transport.

If this practice were to continue on such a scale, major upheavals in terms of mobility, regional planning and location of economic activities will emerge. It is difficult to know what the exact impact of these major changes would be.

2. A technological leap

Employees forced into telecommuting and students taking online courses had to acquire the appropriate technological tools and skills. This has not only reduced mistrust and resistance to new technologies, but also stimulated demand and investment in technology in many countries.

For some countries and in particular the poorest countries, digital technology has remained an unbridgeable gap. The problems of Internet access in some countries represent an obstacle to change.

The pandemic helps to shed light on these shortcomings, and to clearly show where investments are needed to ensure global access to the Internet.

Many governments have announced new investments to fill these gaps. Technological advances in education and training are also leading to rethinking the way in which knowledge transfers should take place.

3. A better awareness of climatic and environmental challenges

When the pandemic appeared, awareness of environmental problems was already acute both in the political world and in public opinion, as we have seen during events such as the “Fridays for Future” or the COP 21 .

The debate continued during the pandemic and seems to have caused several countries to seriously consider how to act for a greener future and tackle climate change.

Analysis of the policy responses provided by some governments show that their interest in climate and environmental issues has increased.

While responses to the crisis have attempted to play on three of the major variables discussed above, the fourth – demographic change and globalization – has received relatively little attention, perhaps because there are fewer reasons to hope in these areas.

Aging societies face a challenge: the downward trend in the proportion of the population in employment. The ratio should even continue to deteriorate in the short term, given the increase in unemployment and inactivity, and in the long term, as young and old will find it more difficult to enter or return to the labor market. . Pension systems will be put to the test, due to the high level of indebtedness resulting from tax aid and economic support mechanisms.

Younger societies, developing countries, which stand to reap the demographic dividends, will face a different kind of challenge: how to find decent jobs for their young people, especially if many of them have experienced a disruption in their lives. education or training. There is a real risk of having a lost generation.

Demographic changes are also dependent on population movements. Many immigrant workers have lost their jobs due to the pandemic. Others, having managed to return home, could not find a job or had to leave.

The future of these migrant workers will depend very much on how states integrate them into their short-term purchasing power support responses and long-term structural policies: extension of social protection for migrant workers, regularization of their status and improvement of their access to training.

The crisis opens our eyes to the vulnerability of several groups. We must take advantage of this awareness to ensure that in the future they are better integrated and better treated and that they can benefit from the processes of structural transformation. Otherwise, the return to normal will not have the human face.

Professor Samir Allal
University of Versailles / Paris-Saclay

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