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While we tend to think of Covid-19 as a distinctly human crisis, it’s also one that has taken a seismic socio-economic toll across the globe.
The labour market has borne the brunt of this, with the United Nations estimating that up to 240 full-time equivalent (FTE) jobs will be lost worldwide during the fourth quarter.
During the first three quarters of 2020, labour income dropped by an incredible 10.7% (or $3.5 trillion) when compared to the same period in 2019. But what exactly has Covid-19 taught us about the job market and what does the future hold within this space?
The Challenge Facing Graduates and Candidates in the Current Climate
Make no mistake; the current challenges facing the labour market could remain for years to come, and there can be no doubt that young people in particular are set to graduate into what may well be one of the toughest spaces for decades.
This is certainly true in the UK, where the unemployment rate grew to 4.5% in Q3 and effectively reached its highest rate in more than three years.
This could well increase further in the near-term, although it’s fair to surmise that the decision to extend the so-called ‘furlough scheme’ will provide some much needed relief to the region’s job market.
The rise in unemployment is also coinciding with a widespread freeze in recruitment and job creation efforts, with this trend prevalent across the globe as countries brace themselves for what could be the deepest recession since World War II.
According to a detailed report by the Institute of Fiscal Studies (IFS), this ongoing job and labour market crisis will almost certainly be deeper than following the great recession of 2008-09, while earnings will also take a significant hit in the near and medium-term.
Why Working From Home has Provided a Beacon of Light in an Ailing Market
Despite its obvious and adverse impact, the coronavirus pandemic has created unique opportunities in fields such as forex and financial market trading.
The same can be said for the labour market in some respects, with the transitions to increased remote working having been accelerated by Covid-19 and highlighted the potential of this as a viable method of working in the future.
In April 2020 (at the height of the pandemic in the UK) an estimated 46.6% of people in employment did some work at home, with a staggering 86.0% of this demographic having done so as a result of the virus.
This trend has continued largely throughout 2020 and into the second lockdown, helping to boost productivity in some instances and encouraging entrepreneurs to reconsider how and where their employees work.
Not only has this helped many businesses to remain open and competitive throughout the pandemic, but it has also played a pivotal role in minimising human contact and slowing the spread of the virus.
In this respect, remote working may well help us to avoid and manage potential pandemics in the future, in much the same way that the transition to a cashless society will minimise unnecessary physical contact.
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