Global unemployment forecast
Experts of the Center for the Development of Human Resources JSC (hereinafter referred to as the MDTD), having analyzed the trends in the global labor market caused by the consequences of the coronavirus pandemic, concluded that one should not expect that the unemployment rate in the world, which increased in 2020, will return to normal in the current or next year.
World GDP declined 3.6% in 2020, according to the World Bank, the worst record on record since 1961. Even the 2009 global financial crisis cost the world 1.7% of lost GDP. The global unemployment rate rose to 6.5% in 2020 amid the crisis, compared to 5.4% in 2018-2019. It is expected to decline slightly to 6.3% in 2021. Currently, there is also a downward trend in the unemployment rate, which rose significantly during the pandemic.
So, if in December 2019 this value was 5.3% for the OECD countries as a whole, then in April 2020 it was already 8.8%, and this growth rate was unprecedented in the modern history of the organization. In just 4 months, 20.4 million people joined the ranks of the unemployed, and their total number increased 1.6 times, from 35.5 to 55.9 million people.
However, by May 2021, the number of unemployed had dropped to 43.5 million people, or 12.4 million people compared to the peak in April last year. “The aggregate unemployment rate in OECD countries is expected to decline to 6.6% in 2021 compared to 7.1% last year, but will remain above the pre-crisis level of 2019 – 5.4%. Even in 2022 it is expected that this figure will decrease only to 6%, ”said Dmitry Shumekov, Director of the Forecasting Department of the MDTD.
Since many people did not formally lose their jobs and kept in touch with the workplace while on forced leave, an alternative to unemployment is the indicator of hours worked. Thus, according to the ILO, in just the last year, the amount of hours worked decreased globally by 8.8%, which means the loss of 303 million full-time jobs (hereinafter – RMPZ). In terms of regions, the largest losses were incurred by the economies of countries with lower middle income, where they amounted to 11.3% (132 million RMPZ).
Countries with high incomes lost only 8.3% (46.3 million RMPZ), with incomes above the average level – 7.3% (110 million RMPZ), with low incomes – 6.7% (15 million RMPZ).
The G20 countries lost a total of 195 million RLM in 2020, or 8.5% of hours worked, and in 2021, their losses will decrease by three times and amount to 68.2 million RLM, which corresponds to a 3% reduction in hours worked. The worst affected countries in this regard were Peru, where the reduction in hours worked was 27.5%, Honduras (24.3%), Panama (23.5%), Argentina (21%). In the United States, losses amounted to 9.2%, the EU, which is part of 27 countries, lost 8.3%, and the United Kingdom – 12.8%. The losses of the largest economies of the European Union (Germany, France and Italy) amounted to 6.3%, 8.4% and 13.5%, respectively. In the largest Asian economies, the number of hours worked decreased as follows: in China – by 4.1%, Japan – by 5.4%, India – by 13.7%.
In Kazakhstan, according to the ILO, due to the COVID-19 crisis in 2020, the time worked by workers in the economy as a whole decreased by 11.5% compared to the previous year, and the loss of working time, expressed in the number of full-time jobs (40 hours per week), amounted to 939.2 thousand units. In neighboring countries, the reduction in lost working time ranges from 8.5% in the Russian Federation and Uzbekistan to 11.7% in Kyrgyzstan.
On a quarterly basis, the second quarter of 2020 was the hardest for the world economy, when the amount of hours worked decreased by 18.2% compared to the last quarter of 2019, while losses in the first quarter were only 5.2%. But already in the third quarter. the quarter, losses fell to 7.2%, and in the fourth – to 4.6%.
The ILO expects that in 2021, global losses will more than halve compared with losses in 2020 and will amount to 3.5%, or 122 million RMPZ. Of these losses, lower-middle-income countries will account for 42.4 million RISM, or 35%, for upper-middle-income countries, 49.5 million RISM (41%), while losses for high-income countries will amount to only 22 million RMPZ, with low – 8.1 million RMPZ.