Thursday 28 Mar 2024
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KUALA LUMPUR (June 16): Over 97.3 million workers, equivalent to about 15% of the workforce, are at high risk of layoffs and furlough across the 35 advanced and emerging countries, said the International Monetary Fund (IMF).

In its Asia and Pacific Department’s Working Paper titled “Who will bear the brunt of lockdown policies? Evidence from tele-workability measures across countries” on June 12 prepared by Mariya Brussevich, Era Dabla-Norris, and Salma Khalid, the authors said workers least likely to work remotely tend to be young, without a college education, working for non-standard contracts, employed in smaller firms, and those at the bottom of the earnings distribution, suggesting that the pandemic could exacerbate inequality.

The report said crosscountry heterogeneity in the ability to work remotely reflects differential access to and use of technology, sectoral mix, and labor market selection.

Policies should account for demographic and distributional considerations both during the crisis and in its aftermath, it said.

The report highlighted that millions of workers are unemployed and countless jobs are increasingly at risk.

It said workers in occupations requiring physical presence at the workplace or those jobs that require a high level of personal proximity have limited scope for working from home.

Some of these workers commensurately face higher risk of reductions in hours or pay, temporary furloughs, or permanent layoffs, it said.

“We find that workers least likely to work remotely are concentrated in the sectors hit hardest by the crisis: accommodation and food services, transportation, and retail and wholesale sectors.

“Workers at the bottom of the earnings distribution are most at risk of earnings loss, suggesting that the COVID-19 crisis could exacerbate inequality,” it said.

Meanwhile, the report said men are more likely to work as plant and machine operators and crafts and trade workers, and in construction, transportation, and manufacturing sectors.

“Women’s employment is often concentrated in the public sector and in the care and education sectors.

“This suggests that female workers could be less affected by the physical lockdowns and social distancing measures currently in place in many advanced and emerging countries,” it said.

The IMF report said women could also be at greater risk of job loss if demand for accommodation and food services, tourism, and retail services, which account for a sizeable share of their labor force participation, particularly for low-skill workers, does not recover when social distancing measures are unwound.

Meanwhile, it said older workers (aged 60 and above), on average, are slightly more likely to hold jobs with a high tele-workability score as compared to younger workers (under 30).

“This result, however, varies significantly across countries, with more than a third of coefficients being negative and statistically significant.

“In Asian countries (Korea, Singapore, Japan) and some emerging market economies (e.g., Kazakhstan, Ecuador) older workers are less likely to be engaged in jobs amenable to teleworking.

“This reflects broad differences in adoption of automation technologies and educational attainment of workers across countries,” it said.

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