- The ILO estimated last week that 24.7 million people worldwide were unemployed.
- Nearly 10 million people lost their jobs in half a month in the United States.
- Unemployment in Europe has already reached the level of the financial crisis
The number of confirmed cases of the new coronavirus has climbed past one million worldwide on Friday, and the implementation of quarantine measures in various countries has caused the economy to shrink as a result of the pandemic. In the United States alone, 10 million people have lost their jobs within half a month.
Economic forecasts of many international institutions are pessimistic, and the European Union has launched a $14 billion package to fight unemployment. Sangheon Lee, director of the Employment Policy Division of the United Nations International Labor Organization (ILO), said that the number of people unemployed globally caused by the new coronavirus pandemic may be much higher than previously predicted.
The ILO estimated last week that 24.7 million people worldwide were unemployed. This is far more than the estimated 22 million people during the 2008 financial tsunami, which caused a loss of $3.4 trillion in income to global workers.
U.S. Unemployment Hits Record Highs
The US Department of Labor announced Thursday that the number of new claims for unemployment benefits doubled to 6.648 million last week, a record high for two consecutive weeks. In all, nearly 10 million people lost their jobs in half a month.
University of Chicago economists estimate that only about 34% of workers in the United States can work from home. According to a poll conducted by the NORC Center for Public Affairs Research, about half of working Americans report that the epidemic has reduced their income or that of their family members. The poor and those without a college degree are more likely to lose their jobs, they said.
Economists predict that in the worst case, the pandemic will cause the United States to lose 47 million jobs, and the unemployment rate will skyrocket to 32.1%, worse than the height of the Great Depression. Canada has 2.13 million people claiming unemployment benefits, which is more than one-tenth of the nation’s total labor force. According to Bloomberg, in just five days from March 25-30, about 580,000 Canadians applied for unemployment benefits.
EU’s €100 billion Deal with Unemployment
Unemployment in Europe has already reached the level of the financial crisis. The Spanish Social Security Data Center announced on Thursday that nearly 900,000 people have been unemployed since mid-March, and 550,000 of them are temporary workers. The number of unemployed registered with the government soared to 3.5 million in March, the highest since April 2017.
The number of people applying for welfare benefits in the UK has soared nearly 10-fold, to nearly 1 million in the past few weeks. The British government launched an aid program last month to replace companies paying up to 80% of their salaries to workers who were unable to work due to the outbreak, with a monthly limit of £2,500, for an initial period of three months to curb layoffs.
The European Commission on April 2 launched a “Support to mitigate Unemployment Risks in an Emergency (SURE),” with a scale of €100 billion to support countries’ wage subsidy programs. European Commission President Ursula von der Leyen also suggested that companies follow the German “Kurzarbeit” scheme, avoiding job cuts by reducing working hours, and subsidizing employees’ salary differentials.