- 22 million jobs have been lost in advanced economies due to the pandemic, according to a new report from the OECD.
- Job retention schemes have saved some 21 million jobs, but rich countries face the threat of rising long-term unemployment rates.
- The impact of that sustained underemployment is set to be worst felt by the vulnerable, women and low-skilled workers, who are disproportionately represented in sectors hard hit by the pandemic.
As many as 22 million jobs have been lost in advanced economies due to the Covid-19 pandemic, the Organisation for Economic Cooperation and Development said Wednesday.
The OECD's annual employment outlook said job retention schemes rolled out during the height of the coronavirus crisis saved some 21 million jobs. Yet rich nations face the threat of rising long-term unemployment rates as many of the low-skilled workers displaced by the pandemic struggle to fill new job openings.
"Many of the jobs that have been lost during this pandemic crisis will not be recovered," Stephane Carcillo, head of the OECD's jobs and income division, said during a briefing to mark the report's release.
In May 2021, unemployment among OECD countries fell to 6.6%, but remained at least 1% above pre-pandemic levels. Of the 22 million who remain out of work across the OECD, 8 million are unemployed and 14 million are considered inactive.
Employment recovery forecast for Q3 2023
The OECD said it does not expect overall employment across member countries to return to normal until the third quarter of 2023. However, individual countries — such as those in Asia-Pacific — which have demonstrated a better handle on the crisis, may improve more quickly.
The impact of that sustained underemployment is set to be worst felt by the vulnerable, women and low-skilled workers, who are disproportionately represented in sectors hard hit by the pandemic.
Young people, too, are likely to be more adversely impacted than the wider adult working population, the report found.
"The scars could be felt for a long time for young people in terms of employment and wages," said Stefano Scarpetta, director of employment, labor and social affairs at the OECD.
According to the OECD, the impact for young people has been at least twice as high as for adults in general — and youths in Canada, the United States, Mexico and Spain were among the worst hit.
Young people severely impacted
That comes against the backdrop of an already tough employment landscape for young people. It took a full 10 years for youth employment to return to normal levels following the 2008 Global Financial Crisis, according to OECD data.
To avoid that "scarring effect," greater measures need to be taken this time to invest in young people — for instance through apprenticeship and reskilling, Scarpetta said.
"The key message is: We should do better this time. We cannot have young people so severely affected," he said.
Meanwhile, the emergence of remote work has been a bright spot from the situation, encouraging employers to be more flexible and inclusive in their work policies.
Going forward, Scarpetta said there is "potential for telework to be more widespread." However, accessibility challenges remain to be addressed, both in terms of who can work remotely and the resources required to do so.
"Otherwise, it might become another divide in the labor market," he said.