ILO discusses the socio-economic impact of the pandemic in the European Parliament

The ILO addressed a public hearing on the socio-economic impact of the pandemic on the labour market and working conditions, organized by the European Parliament’s Special Committee on the COVID-19 pandemic. This Committee, which is chaired by Belgian MEP Kathleen Van Brempt, looks into how the EU's response to the pandemic and the lessons learned can contribute to future action, focussing on four key pillars: health, democracy and fundamental rights, societal and economic impact, and the EU and the world.

During her presentation, Lieve Verboven, Director of ILO-Brussels, underlined the sheer scale of the COVID-19 crisis. Its impact has been four times greater than that of the financial crisis of 2008-2009.

Millions of people lost their job and salary. In 2020, the equivalent of 255 million full-time jobs were destroyed. In the same year, the income from labour also fell by an equivalent of 4.4 percent of global GDP.

In the third quarter of 2022, there has been a loss of 40 million full-time equivalent jobs. “We are doing better now globally, but we are still not back to the pre-pandemic situation”, explained Ms Verboven. The Americas have been the best performers this year, with more worked hours than before the crisis unlike all other regions.

Women were overrepresented in sectors that were hard-hit by the pandemic, such as accommodation and food services and manufacturing. In 2020, 3.6 percent of women’s employment were destroyed, compared to 2.9 percent for men. In 2021, there were still 20 million fewer women in employment than before the pandemic.

“The employment growth that we have seen in the recovery phase of the pandemic was largely due to a rapid increase in the number of informal jobs, which has been faster than the growth in formal employment,” said Ms Verboven. This threatens the slow but consistent trend towards formalisation over the last 15 years.

The Director also mentioned a few positive developments. Last year, the International Labour Conference decided to include the principle of a safe and healthy working environment in the ILO’s framework of fundamental rights.

The pandemic has also demonstrated the vital importance of universal social protection. Ms Verboven gave the example of Spain. During the pandemic, Spain realized that its domestic workers were not sufficiently covered in terms of social protection and unemployment benefits. The country has recently adopted legislation to extend social security to all domestic workers and has ratified the ILO Domestic Workers Convention n°189.

The financial support offered by SURE, a temporary loan instrument supporting short-time work schemes and similar measures, helped EU Member States to protect jobs and thus employees and self-employed against the risk of unemployment and loss of income.

Job creation and job formalization, as well as further strengthening labour rights and social dialogue are also key in tackling the socio-economic consequences of the pandemic.