The novel coronavirus pandemic and recession have destroyed the
jobs of millions of people across the world at staggering levels. Due to lockdowns
and distancing protocols, many self-employed, casual workers and regular
workers were unable to work, and many were deprives of their jobs and source of
livelihoods. Understandably, this has aggravated the already grim employment
situation due to worldwide economic slowdown, particularly in developing
regions such as south Asia, for both white and blue collar jobs.Job Loss Scenario in South Asia
As per the latest report by the International Labour Organization
(ILO), nearly 400 million full-time jobs were estimated lost by July 2020.
South Asia significantly accounted for 110 million of the total 235 million
full-time jobs lost during the second quarter. There were 21 million full-time
job losses in first quarter and 110 million in the second. Overall it is
estimated that job losses increased by over 400 per cent in south Asia and
Another report found the greatest reduction in working hours
occurred in Latin America (20 per cent) and south Asia (18 per cent) in 2Q
2020. Job deprivation was highest in the informalised sector, the casual
and temporary in service and industrial sectors, owing to severe lockdowns. The
south Asian region has the highest share (75%) of informal workforce,
especially in India, where it constitutes 81% of employment.
Job Losses in India during lockdown
Survey of Survey Analysis
The employment or livelihood of most of the people was affected
during the lockdown and pandemic in India, especially those engaged in informal
sector. Although there have not been any official estimates, however, several
surveys conducted in India highlight about the miserly of people who have lost
An important finding from several survey studies during the
lockdown, (mostly telephonic) shows that on an average 6 out of 10 workers had
lost their jobs or livelihood sources, 7 out of 10 casual labourers had lost
their jobs, while 6 out of 10 self-employed respondents could not pursue their
economic activities and 4 out of 10 regular workers had lost their jobs.
Interestingly, these survey findings also highlighted that over 8
out of 10 respondents who worked as casual labour and self-employment in
informal sector said “we would get back to work once the lockdown would be
As many as 41 lakh youths in the country lost jobs due to the
covid-19 pandemic while construction and farm sector workers account for the
majority of job losses, according to a joint report by the ILO and the Asian
While the Government of India has not released any data pertaining
to job losses during the lockdown, it acknowledges the quantum of migrants,
around 1.5 crores, who returned to their homes. Also, government estimates suggest
that around 8-10 crores workers were affected due to lockdown, mostly in the
non-agrarian informal sector.
From data analysis of the Periodic Labour Force Survey (PLFS) to
understand the likely impact on informal workers in urban areas during and
after the lockdown period, we estimate that about 93 million informal workers
are involved in the five worst affected sectors: manufacturing, trade, hotels
and restaurants, construction; transport, storage and communications; and
finance, business and real estate. Of the 93 million informalised workers in
these sectors, 50% are self-employed, 20% are casual workers on daily wages and
30% are salaried or contract employees without any social safety nets.
Job Losses as India Unlocks
Similar to the independent surveys’ findings, the Centre for
Monitoring Indian Economy estimates that 21 million people have rejoined their
employment or jobs after governments started to Unlock. The reversal of job
loss – if not incomes – has been achieved and the employment rate is moving
towards pre-lockdown levels. Almost two-thirds of the jobs added (14.4 million)
were of self-employed (small traders) and wage labourers.
The CMIE reports also mention about 6.8 million daily wage earners
lost their jobs since April 2020, and 15 million people took to farming during
this period either as self-employed or casual labour. This reveals that
the loss of jobs in self-employment and casual labour category is a temporary
or short-term phenomenon, which is not true in case of full-time salaried jobs.
Salaried people (includes both permanent and temporary) who have
lost their jobs may not get back to employment in the near future. White-collar
jobs in particular, once lost are far more difficult to retrieve.
Job Losses of White-Collar Regular Salaried:
Serious Concerns amid Recession
The CMIE reports that about 18.9 million salaried people lost
their jobs, declined by a whopping 22 per cent during the lockdown. Salaried
jobs were estimated at 86.1 million in 2019-20, which fell to 67.2 million by
July 2020. Salaried jobs are preferred forms of employment for most people as
these jobs offer better terms of employment and also better wages.
The biggest loss of jobs among salaried employees was of
‘white-collar professional employees’, which include 5.9 million workers
between May-August, 2020. The white-collar workers include engineers, including
software engineers, physicians, teachers, accountants, analysts and the type,
who are professionally qualified and were employed in some private or
The lockdown did not impact white-collar clerical employees. These
include largely desk work employees ranging from secretaries and office clerks
to BPO/KPO workers and data-entry operators. They possibly shifted to the
work-from-home mode, said CMIE.
Since the lockdown was imposed, several companies across sectors
have taken to job cuts, along with salary reductions and leave without pay.
This exposes the fragility of India’s formal sector, which is
always considered the best job in the market of labourers, highlighting the
support it requires for resilience. Ballooning numbers of job losses for formal
white-collar workers, having higher value addition, depict a worrisome picture
of the Indian job market, with rising unemployment and huge future uncertainty
amidst the pandemic and recession.
There is considerable research to indicate that job losses can
result in permanent economic damage if workers stay unemployed for too long. This is the keyconcern of policy makers and other stakeholders today.
Towards Resilience for Formalised Jobs
As India unlocks, there are recoveries recorded for casual workers
and self-employed with obvious limitations of economic activities. The
regular/salaried workers (permanent and temporary jobs) job losses and revised
terms of job and salaries owing to the performance of businesses and enterprises,
has revealed the fragile state of affairs and is a serious concern for the
Many countries across the world such as USA and UK, are providing
various support to the businesses and salaried workers to protect the job
losses, such as contribution to salaries, unemployment allowances, loans, etc.,
often surpassing the debt limits, during the ongoing pandemic and recession.
As we move towards the New Normal of COVID-19 protocols, work from
home, virtual economy, digitization and automation at work processes, the
white-collar jobs are threatened. In fact, the coronavirus has indeed proven
disastrous for them, as we deal with the pandemic and economic crisis.
The Government of India has suggested to businesses that they keep
the jobs intact, without any potential and significant support. As India
unlocks in the economic recession, formalised jobs (both permanent and
temporary) in government and private sector are facing various churns from
layoffs, delay payment, reduced payments, and so on.
Clearly the Union government needs to act now, and focus on
regenerating economic activities as well as stimulating aggregate demand giving
due consideration to those who have lost their white-collar jobs and vulnerable
businesses to minimise the losses.
The road towards Self-Reliant India and New India should ensure
resilience in the formalised economy, immediate support for workers and their
families, and harnessing our data and digital capabilities for significant
impact in the lives of people.
Prof. Balwant Singh Mehta and Dr. Arjun Kumar
are with the Impact and Policy Research Institute (IMPRI), New Delhi