Lockdown amid COVID-19 Crisis could Push 40 Crore Indians to Poverty

New Delhi, April 8, 2020:

Lockdown amid the COVID-19 crisis may push 40 crore Indians, who are working with the casual sectors, to poverty.

According to the projections of the International Labour Organisation (ILO), the COVID-19 pandemic has affected 2.7 billion workers globally following the lockdown in several countries.

It noted that COVID-19 has already impacted tens of millions of informal workers and in countries like India, Nigeria and Brazil, the number of workers in the informal economy affected by the lockdown and other containment measures is substantial.

ILO opines that India, which has almost 90 percent of its population engaged with the informal set up, has the risk of pushing nearly 40 crore of the people working at the casual sector to poverty during the coronavirus crisis.

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The 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.

It viewed that without proper policy measures, the workers will face a high risk of falling into poverty and will experience greater challenges in regaining their livelihoods during the recovery period.

The report said that particularly in low- and middle-income countries, hard-hit sectors have a high proportion of workers in informal employment and workers with limited access to health services and social protection.

ILO noted that the COVID-19 pandemic has further accelerated in terms of intensity and expanded its global reach. Full or partial lockdown measures are now affecting almost 2.7 billion workers, representing around 81 per cent of the global workforce.

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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.

Using this approach, as of April 1, 2020, the ILO's new global estimates indicate that working hours will decline by 6.7 percent in the second quarter of 2020, which is equivalent to 195 million full-time workers.

The majority of job losses and declining working hours will occur in hardest-hit sectors. The ILO estimates that 1.25 billion workers, representing almost 38 per cent of the global workforce, are employed in sectors that are now facing a severe decline in output and a high risk of workforce displacement.

The key sectors that are at high risk of layoffs include retail trade, accommodation and food services, and manufacturing. Workplace closures have increased so rapidly in recent weeks that 81 per cent of the global workforce lives in countries with mandatory or recommended closures.

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COVID-19 is now also impacting the developing world, where capacities and resources are severely constrained. Through the massive economic disruption, the COVID-19 crisis is affecting the world's workforce of 3.3 billion.

It may be mentioned here that the COVID-19 pandemic's impact is so grave that the economy itself is being now called a "pandemic". Experts have begun to dwell on the most risky thought of all time - Is India, with an already declining economy, at the highest risk of an economic pandemic?

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