Asia-Pacific labour market insights

Depressed global consumer demand continues to hit jobs in Asia and the Pacific

Almost 1 in 3 jobs in Asia and the Pacific are linked to the production of manufacturing products. COVID-19 has led to severe declines in global consumer demand, with only partial and in many cases uncertain recovery in sales of many of these products. An ILO brief highlights the adverse impacts of these consumption trends on peoples’ jobs and livelihoods, especially given the slow progress on vaccination within parts of the region and among some of its trading partners.

Analysis | 30 July 2021
Global consumer demand has been hit hard by the COVID-19 pandemic. Demand for most manufacturing goods remains depressed in large parts of the world. The situation is also very volatile, with some countries experiencing short-lived rebounds in consumer demand until struck by new waves of the pandemic.

As highlighted in COVID-19, vaccinations and consumer demand: How jobs are affected through global supply chains the Asia and the Pacific region has felt the adverse impacts of these trends1. Millions of enterprises and workers in the region are linked to global consumer demand through global supply chains. In 15 economies in the region with available data2, an estimated 467 million jobs are associated to global supply chains for manufacturing, accounting for about 28 per cent of total employment. These jobs are located in the manufacturing sector itself, but also in other sectors – such as agriculture and services – that contribute to the production of manufacturing products, consumed within the region or exported worldwide.

Key figures:

    • Out of all jobs in the region linked to global supply chains for manufacturing, an estimated 80 million jobs experienced a high adverse impact in April 2021, due to the drop in consumer demand as transmitted through global supply chains. A further 97 million jobs witnessed a medium adverse impact. These jobs are estimated to either have been completely lost or to have suffered substantially from reduced working hours or other pressures on working conditions such as income losses.
    • Compared with April 2020, when nearly all jobs in global supply chains for manufacturing endured either high or medium adverse impacts, the jobs situation had improved substantially by April 2021. However, the number of adversely affected jobs has taken a slightly upward turn again between October 2020 and April 2021.
    • Relative to total employment, the Asia and Pacific region has had the largest share of highly impacted jobs linked to global supply chains throughout the pandemic. This is also a reflection of the region’s dominance in manufacturing production over the past decades. While that share of highly impacted jobs peaked in April 2020 at 13 per cent, it was at about 5 per cent in April 2021.
    • Slow vaccination progress in the region and in trading partner countries leaves jobs linked to global supply chains for manufacturing at greater risk. An estimated 80 per cent of these jobs in Asia and the Pacific are sustained by consumer demand in countries that are not expected to reach a vaccination rate of 60-70 per cent among adult populations any time before late 2022. Under the assumption that such a level of vaccination coverage would be needed to control the pandemic, these jobs remain vulnerable at least until then.
    1 This note aims to highlight the regional figures, while the brief has global coverage.
    2 These countries cover about 86 per cent of the labour force in the Asia and the Pacific region.

    For further information please contact:

    Christian Viegelahn
    Labour Economist