Massive drops in working hours due to the Covid-19 crisis have had a devastating effect on jobs and incomes in the Asia Pacific region with the economic backlash wiping out approximately 81 million jobs in 2020, according to a new report by the International Labour Organisation (ILO).

According to Asia Pacific Employment and Social Outlook 2020 report, nearly all economies with available quarterly data for 2020 showed that employment levels contracted compared to 2019.

Overall, working hours in the Asia Pacific region decreased by an estimated 15.2% in the second quarter and by 10.7% in the third quarter of 2020, relative to pre-crisis levels.

Working-hour losses are also influenced by the millions of persons moving outside the labour force or into unemployment as job creation in the region collapsed. Using available quarterly data, the report provides a preliminary estimate that the regional unemployment rate could increase from 4.4% in 2019 to somewhere between 5.2% and 5.7% in 2020.

Chihoko Asada Miyakawa, ILO Assistant Director General and Regional Director for Asia and the Pacific, said, “Covid-19 has inflicted a hammer-blow on the region’s labour markets, one that few governments in the region stood ready to handle. Low levels of social security coverage and limited institutional capacity in many countries have made it difficult to help enterprises and workers back on their feet, a situation compounded when large numbers remain in the informal economy. These pre-crisis weaknesses have left far too many exposed to the pain of economic insecurity when the pandemic hit and inflicted its toll on working hours and jobs.”

According to the report, most countries in the region saw a larger decline in working hours and employment for women than men. Also, women were more likely to move into inactivity than men. Young people have also been especially affected by working-hour and job losses. The youth share in overall employment loss was 3 to 18 times higher than their share in total employment.

Overall, labour income is estimated to have fallen by as much as 10% in the Asia Pacific region in the first three quarters of 2020, equivalent to a 3% loss in gross domestic product.

Sara Elder, Senior Economist at the ILO Regional Office for Asia and the Pacific and lead author of the report said, “On the more positive side, we are able to show in this report that government efforts to help enterprises retain workers, albeit on reduced hours, have worked to prevent what would otherwise be larger job losses. Given the mounting evidence that social protection and employment policies save jobs and incomes, the hope is that the crisis brings about a more permanent and increased investment in elements needed to boost resilience and promote a more people-centred future of work.”