The COVID-19 pandemic has challenged the world of work. Full and partial lockdown measures have had devastating economic effects worldwide. Will the pandemic create a paradigm shift in our perception about employment practices? LSE Student Ambassadors Havi and Carola, specialising in International Employment Relations (IER), discuss key employment concerns from an IER perspective.
How the COVID-19 crisis could affect the world of work
The COVID-19 pandemic constitutes an unprecedented challenge to the world of work. The implementation of full or partial lockdown measures have had devastating economic effects worldwide, with the International Monetary Fund (IMF) predicting a 3% contraction on the global economy in 2020 in its last update of the World Economic Outlook.
The repercussions of this coronavirus-driven collapse on employment in both developed and developing economies are staggering.
The International Labour Organization (ILO) estimates that around 6.7% of global working hours will be lost in 2020, an amount at least equivalent to 195 million full-time workers.
As a result, many employment issues in International Employment Relations (IER) have gained further prominence in the public eye.
Despite still being in its early phase, it is clear that the pandemic is likely to create a paradigm shift in our perception about employment practices. As students specialising in IER, Havi and I discuss some of the key employment concerns from an IER perspective.
The International Labour Organization estimates that around 6.7% of global working hours will be lost in 2020, an amount at least equivalent to 195 million full-time workers.
Resurgence of the state?
For the past 40 years, the concurrent phenomena of globalisation and neoliberalism have diminished the role of states in employment relations, as states increasingly face pressures to accommodate global markets and labour market flexibility at the expense of pay and job security.
However, since the beginning of the COVID-19 outbreak, it has become apparent that a health and economic emergency of this magnitude requires states to engage in strong interventionist activities to avoid a social and economic collapse.
Thus, a reassessment of the state’s role within labour relations is occurring.
Perhaps for the first time since Margaret Thatcher’s days, in liberal market economies such as the US and the UK the legitimacy of neoliberal principles relegating the state to a mere agent of market preservation is truly beginning to falter.
- In the US, massive layoffs and the lack of a public health system have reignited a public debate on the need for stronger welfare state provisions.
- In the UK, Prime Minister Boris Johnson recently asserted that “There is such a thing as society”, de facto distancing himself from Thatcher’s controversial remark made in the 80s “There is no such thing as society” and suggesting the possibility of a new era of an active state in the UK.
…a reassessment of the state’s role within labour relations is occurring.
Cracks in the gig economy?
The spread of the coronavirus is shedding light upon the precariousness of “independent contractors” or so-called “gig” workers across the globe.
The rise of the gig economy has progressively undermined worker protections, and today’s crisis is exposing just how much working conditions have deteriorated worldwide.
Not only do independent contractors working for companies such as Deliveroo and Uber have any choice but to keep working due to the lack of protections like guaranteed pay and sick leave; their health is also jeopardised as many companies are failing to provide them with safety equipment such as gloves and masks.
- In Europe, labour unions representing autonomous workers are calling for stronger protection measures to be approved and implemented by governments.
- In the US, however, where unions’ power is weaker, it is up to the single companies to establish the degree of social protection to provide workers.
In other unfortunate cases, hundreds of thousands of gig workers have lost their jobs and now risk not receiving unemployment benefits due to their status as autonomous workers.
In the US… where unions’ power is weaker, it is up to the single companies to establish the degree of social protection to provide workers.
The informal sector: survival at stake
The threat that the pandemic poses for informal sector workers globally cannot be overstated. For example, an ILO Report predicted that 400 million informal sector workers in India could be forced deeper into poverty.
Agricultural workers, homeworkers and self-employed workers such as street vendors have been affected by a drastic reduction in working hours, wage cuts and layoffs, depriving them of the ability to feed themselves.
Through an IER lens, this situation can be explained by a general decent job deficiency.
- In India, this situation exposes the minimal legislation around non-standard workers’ rights, and the absence of a ‘social floor’ such as a minimum wage. As a result, informal sector workers faced with significant pay cuts, are being forced to migrate back to their villages, where they would receive greater communal support. Some have even travelled 700km by foot to complete their journey.
Where are we headed?
Although post-coronavirus times are hard to foresee at the moment, it seems like the future of work could witness an exponential rise in work-from-home practices, given that the majority of industries are now operating virtually. This potential change could significantly revolutionize the way individuals and organisations manage their productivity and overall performance, even in industries that would have never imagined doing so, like hospitality.
The rise of automated jobs, robotics and artificial intelligence could be spurred at an even faster rate by the pandemic. This could be especially true in the logistics industry; automation could help limit workers’ exposure to pathogens.
However, this could have significant implications in the form of increased laws in data sharing and personal data protection.
Msc student in Human Resources and Organisations here at LSE. Accidentally stepped into a bookstore in Amsterdam, bought the book A Job to Love, and now happily pursuing my purpose. Global citizen but Italian at heart. Would never turn down a cup of good coffee.
Msc student in Human Resources and Organizations at LSE. Born in India, but spent most of my childhood in Singapore, Cambodia and Malaysia. Aspiring to create a ‘truly’ diverse and inclusive work culture. An avid musician and sports enthusiast.
Learn more about our MSc Human Resources and Organisations programme
Nice analysis of post covid future of workers / industries in some countries. I would be interested in your analysis on post Covid19 industrial analysis of China.
Excellent piece. Cov-19 has had a massive impact on work practices which this article captures brilliantly.
I can’t wait to read your next article on remote working and it’s socio-economic impact.
Insightful analysis of the strengthened role of the state and future increase in work-from home practices!
Interesting analyssi of the different repercurssions this pandemic is going to have on all of us and particularly on our profession. Really smooth lecture!! Congrats