The impact of COVID 19 on laboour markets around the world

The COVID-19 pandemic holds its firm grip on the global economy for a second year in 2021, continuing to cause massive disruptions in labour markets in many countries. The pace at which economic activity resumes depends largely on the extent to which the virus is contained. Every new outbreak brings setbacks, with recovery following different patterns across geographies and sectors. Gains in labour markets made prior to the pandemic are all but wiped out and whatever deficits existed are dampening the prospects for a sustainable recovery in many regions.
Whereas at the beginning of the crisis there were signs that the damage on labour markets could be less than during the financial crisis, this hope has disappeared. A return to pre-pandemic performance remains elusive for much of the world over the coming years. Globally, labour market recovery from the pandemic shock has stalled during 2021, with little progress being made since the fourth quarter of 2020.
In addition, recovery patterns vary significantly across country income groups, thereby further widening gaps between countries and within countries. At the onset of the recovery, employment trends in low- and middle-income countries remained significantly below those observed in richer economies, owing largely to the lower vaccination rates and tighter fiscal space in developing countries. The pandemic’s impact has been particularly devastating for developing countries that experience higher levels of inequality, more heterogeneous working conditions, relatively weaker social protection systems, and constricted fiscal space.
Questions that need to be addressed include: Why is the impact of this crisis worse than the impact of other crises, including the financial crisis? What can we learn for the recovery process from earlier crises? What are policies we need to ensure that recovery will happen and lead to long-term transitions in countries so that they become more resilient to future crises? What are the long-term perspective of labour markets?

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