Title

Assessment of Labour Market disruptions in Pakistan due to COVID-19

Abstract/Description

The COVID-19 pandemic has gripped the entire world, with more than 90 million cases and 1.95 million fatalities reported upto January 13, 2021. The social and economic effects of COVID-19 have been felt with greater intensity across least developed, developing and emerging market economies irrespective of their income level Workplace closures have disrupted labour markets around the world, leading to working hour losses estimated at 17.3 per cent, or 495 million Full-Time Equivalent (FTE) jobs, in the second quarter of 2020 (ILO 2020). Lower-middle-income countries were the hardest hit, having experienced an estimated decline in working hours of 23.3 per cent (240 million FTE jobs) in the second quarter of the year. Existing estimates suggest that the pandemic will result in a US$ 2 trillion shortfall in global income, halve global growth from to 1.5 percent in 2020 and increase global unemployment by at least 25 million (UNCTAD 2020). Like other developing countries, Pakistan has also suffered from the adverse effects of economic slowdown brought about by COVID-19. Due to both demand and supply side shocks, the country’s economy witnessed a negative growth of 0.38 percent in the outgoing fiscal year 2019-20 (GoP 2020). This was driven by a 2.67 percent, -2.64 percent and -0.59 percent growth in agricultural, industrial and services sectors respectively; with the lockdown measures imposed during the period March to May 2020 severely impacting economic activity in the last quarter of FY 2019-20. Results from the recently released survey evaluating the socio-economic impact of COVID-19 carried out by the Pakistan Bureau of Statistics (PBS) shows that 27.31 million of the working population aged 10 years and above in the country was affected due to the lockdown measures, with 20.6 million suffering from job losses, in terms of layoffs, forced leaves, reduced volume and hours of work (PBS 2021). The proposed study would present a first of its kind analysis of the labour market disruptions faced by Pakistan’s employed workforce, as a result of the COVID-19 pandemic. The study would make use of microdata from the recently carried out rapid assessment household survey by the PBS, which was conducted during October – November 2020. The employment module of the survey collected information on working population, sector of work/occupation status and household income, before Covid-19 (January-March 2020), during Covid-19 first wave (April –July 2020) and after Covid-19. This data would enable an analysis of the loss in employment by sector, employment status and occupational grouping as a result of the pandemic, as well as the post lockdown recovery in jobs. In addition, the study would also carry out a multivariate analysis to identify major household socio-economic and demographic characteristics associated with the likelihood of employment loss as well as the factors influencing recovery in employment in the post-lockdown period. The analysis will offer useful policy recommendations for design of policies and programs for increasing labour market flexibility and promoting employment growth in the post-COVID recovery phase.

Session Theme

Labour Market and Career Choices - Session IIA

Session Type

Parallel Technical Session

Session Chair

Dr. Qazi Masood, Professor, IBA, Karachi

Session Discussant

Dr. Abbas Gillani, Assistant Professor - Institute of Business Administration Karachi

Start Date

3-4-2021 2:30 PM

End Date

3-4-2021 4:00 PM

Comments

The authors are respectively; Director Research and Labour Economist at Policy Research, Innovation, Development and Education (PRIDE)

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Apr 3rd, 2:30 PM Apr 3rd, 4:00 PM

Assessment of Labour Market disruptions in Pakistan due to COVID-19

The COVID-19 pandemic has gripped the entire world, with more than 90 million cases and 1.95 million fatalities reported upto January 13, 2021. The social and economic effects of COVID-19 have been felt with greater intensity across least developed, developing and emerging market economies irrespective of their income level Workplace closures have disrupted labour markets around the world, leading to working hour losses estimated at 17.3 per cent, or 495 million Full-Time Equivalent (FTE) jobs, in the second quarter of 2020 (ILO 2020). Lower-middle-income countries were the hardest hit, having experienced an estimated decline in working hours of 23.3 per cent (240 million FTE jobs) in the second quarter of the year. Existing estimates suggest that the pandemic will result in a US$ 2 trillion shortfall in global income, halve global growth from to 1.5 percent in 2020 and increase global unemployment by at least 25 million (UNCTAD 2020). Like other developing countries, Pakistan has also suffered from the adverse effects of economic slowdown brought about by COVID-19. Due to both demand and supply side shocks, the country’s economy witnessed a negative growth of 0.38 percent in the outgoing fiscal year 2019-20 (GoP 2020). This was driven by a 2.67 percent, -2.64 percent and -0.59 percent growth in agricultural, industrial and services sectors respectively; with the lockdown measures imposed during the period March to May 2020 severely impacting economic activity in the last quarter of FY 2019-20. Results from the recently released survey evaluating the socio-economic impact of COVID-19 carried out by the Pakistan Bureau of Statistics (PBS) shows that 27.31 million of the working population aged 10 years and above in the country was affected due to the lockdown measures, with 20.6 million suffering from job losses, in terms of layoffs, forced leaves, reduced volume and hours of work (PBS 2021). The proposed study would present a first of its kind analysis of the labour market disruptions faced by Pakistan’s employed workforce, as a result of the COVID-19 pandemic. The study would make use of microdata from the recently carried out rapid assessment household survey by the PBS, which was conducted during October – November 2020. The employment module of the survey collected information on working population, sector of work/occupation status and household income, before Covid-19 (January-March 2020), during Covid-19 first wave (April –July 2020) and after Covid-19. This data would enable an analysis of the loss in employment by sector, employment status and occupational grouping as a result of the pandemic, as well as the post lockdown recovery in jobs. In addition, the study would also carry out a multivariate analysis to identify major household socio-economic and demographic characteristics associated with the likelihood of employment loss as well as the factors influencing recovery in employment in the post-lockdown period. The analysis will offer useful policy recommendations for design of policies and programs for increasing labour market flexibility and promoting employment growth in the post-COVID recovery phase.