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Wednesday Apr 08 2020
Web Desk

In India, nearly 400 million workers may sink into poverty due to COVID-19 pandemic

Web Desk
Migrants workers rest inside a workshop after it was shut due to the 21-day nationwide lockdown to slow the spread of the coronavirus disease (COVID-19), in Mumbai, India, April 7, 2020. Photo: Reuters

A report released by International Labour Organisation (ILO) on Tuesday has said that nearly 400 million people working in the informal economy in India were at risk of falling deeper into poverty due to the coronavirus crisis.

"About 400 million workers in the informal economy are at risk of falling deeper into poverty during the crisis and is expected to wipe out 195 million full-time jobs or 6.7" of working hours globally in the second quarter of this year,” the UN's labour body said in its report.

Titled, 'ILO Monitor 2nd edition: COVID-19 and the world of work', the report describes coronavirus as "the worst global crisis since World War II".

"What we do now in terms of maintaining that relationship between workers and their enterprises to keep them on the labour market, that will pay dividends when it comes to the trajectory and the gradient of recovery hopefully in the latter part of this year," ILO director-general Guy Ryder told a news conference.

Workers in the informal sector — who account for 61% of the global workforce or 2 billion people — will need income support just to survive and feed their families, if their day jobs disappear, he said.

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"These are people who generally do not have access to the normal social protections that might go with a formal employment status," Ryder said.

Ryder said India's lockdown has put millions of migrant workers in a quandary.

"If you require people to stop working, go home and stay at home but they have absolutely no other source of income, then the choice can become between that of protecting yourself against the virus and having no means of surviving, no means to feed yourself," he said. "And these are impossible dilemmas."

The report added that worldwide, two billion people working in the informal sector (mostly in emerging and developing economies) were at risk.

"In India, Nigeria and Brazil, the number of workers in the informal economy affected by the lockdown and other containment measures is substantial," ILO said.

"In India, with a share of almost 90% of people working in the informal economy, about 400 million workers in the informal economy are at risk of falling deeper into poverty during the crisis. 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," it said.

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More than four out of five people (81%) in the global workforce of 3.3 billion are currently affected by full or partial workplace closures, it said.

The report further said that 1.25 billion workers employed in the sectors identified as being at high risk of "drastic and devastating" increases in layoffs and reductions in wages and working hours. Many are in low-paid, low-skilled jobs, where a sudden loss of income is devastating.

Looked at regionally, the proportion of workers in these "at risk" sectors varies from 43% in the Americas to 26% in Africa.

Some regions, particularly Africa, have higher levels of informality, which combined with a lack of social protection, high population density and weak capacity, pose severe health and economic challenges for governments, the report said.

The ILO suggested that large-scale, integrated, policy measures were needed, focusing on four pillars: supporting enterprises, employment and incomes; stimulating the economy and jobs; protecting workers in the workplace; and, using social dialogue between government, workers and employers to find solutions.

"We expect that unless we have serious and immediate actions taken right now the recovery is going to be rather long and painful," Sangheon Lee, director of ILO's employment policy department and author of the report said.