March 27: Global job losses from the coronavirus crisis could far exceed the 25 million estimated just days ago, UN officials said on Thursday (March 26), according to a news report published by Reuters.
The news agency reported that US jobless claims surged to record levels, starkly showing the scale of the economic disaster.
The International Labour Organization had estimated a week ago that, based on different scenarios for the impact of the pandemic on growth, the global ranks of the jobless would rise between 5.3 million and 24.7 million.
However Sangheon Lee, director of the ILO's employment policy department, told Reuters that the scale of temporary unemployment, lay-offs and the number of unemployment benefit claims were far higher than first expected.
Lee said that the magnitude of fluctuation is much bigger than expected. According to him, the projection will be far higher than the estimated 25 million.
By comparison, the 2008/9 global financial crisis increased global unemployment by 22 million.
In the United States, where, as in many parts of the world, measures to contain the pandemic have brought the country to a sudden halt, the number of Americans filing claims for unemployment benefits surged to more than 3 million last week.
That shattered the previous record of 695,000 set in 1982. Economists polled by Reuters had forecast claims would rise to 1 million, though estimates were as high as 4 million.
According to the news published by Reuters, countries across the world are feeling the intense human and economic pain wrought by the coronavirus, which has infected more than 470,000 people, killed more than 21,000, and is expected to trigger a global recession.
In India, where Prime Minister Narendra Modi announced a 21-day nationwide lockdown this week to stem the spread of the disease, industry groups warned job losses could run into tens of millions.
“Among those hardest hit will be India's estimated 120 million migrant labourers, for whom the lockdown means wages are disappearing. Many cannot afford rent or food in the cities and, with transport systems shut down, many have now begun to walk hundreds of miles to return to their villages,” Reuters reported.
In Europe, France is pulling out the stops to persuade companies not to fire their employees, including through a scheme that allows businesses to reduce worker hours without the employee taking a massive pay hit.
In Britain, the government said 477,000 people had applied over the past nine days for Universal Credit, a payment to help with living costs for those unemployed or on low incomes.
"Unemployment is extremely sensitive and volatile in response to economic activity, that is quite worrisome in our view," Reuters quoted ILO’s Lee as saying.
"The sentiment among businesses is maybe it will take more time to get back to normal activities. They are making quick decisions to adjust their workforce rather than keeping workers."