Governments must work to make labor markets more resilient

Governments must work to make labor markets more resilient

Governments must work to make labor markets more resilient
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If the COVID-19 pandemic has taught us anything, it is that bolstering resilience should be a priority for governments in the coming years.
In an unfortunate series of events, what began as a localized outbreak quickly rippled around the globe, unfolding rapidly and creating devastating economic chasms that burdened social protection and healthcare systems worldwide.
To counteract the spread of the virus, many countries chose to impose lockdowns, closures, travel restrictions and border controls. Consequently, there were dramatic and complex implications for the labor market, leaving no sector, job or employee unaffected — adding fuel to an already distressed global economy affected by other significant challenges.
A recent report published by the International Labour Organization shed light on the effects of the pandemic on global labor markets. Projections indicate that in 2022, the total hours worked globally will remain 2 percent lower than pre-pandemic levels. This amounts to a reduction of approximately 52 million jobs. Meanwhile, global unemployment remains 21 million higher than its 2019 level.
Job losses put governments in critical states of emergency as more people are unable to access essential goods and services without some form of social protection and support. As such, the pandemic has also adversely affected the livelihoods of already vulnerable households; estimates suggest an additional 30 million adults have been pushed into extreme poverty (living on $1.90 or less a day) because of the reduced availability of paid work.
Economies that are fueled mainly by small and medium enterprises have experienced massive disruptions in terms of employment and hours worked, with minimal financial reserves to help keep them afloat.
Female workers, in particular, were forced to exit the labor market because of the need to prioritize care for vulnerable family members as a result of the closure of child care and social care facilities at the height of the pandemic.
Temporary workers also suffered job losses and reductions in hours worked, particularly those in seasonal or physically demanding jobs in agriculture, construction and tourism. Countries that were reliant on migrant workers also faced steep labor shortages.

More than two years on from the start of the pandemic, the global labor market is slowly recovering and, interestingly, has evolved in many aspects, as it has had to adjust to a tumultuous period during which enterprises and governments showed greater interest in technological innovations, remote working and employee well-being.

The pandemic has highlighted to employers the importance of implementing well-being programs that equip employees with the skills and knowledge they need to manage stress.

Sara Al-Mulla

Moreover, the labor market was witnessing salient evolutions even before the pandemic. For instance, labor markets are challenged by an aging population that is putting pressure on various enterprises and causing governments to rethink skills retraining, retirement ages, and measures to boost fertility rates to counteract demographic replacement rates. Meanwhile, the labor deficits apparent in many aging populations are paving the way for more flexible immigration policies that can attract global talent.
Moreover, urbanization trends projected by the UN predict that a whopping 4.9 billion people will soon live in cities, creating pressure on authorities to design urban policies that boost job creation, while at the same time ensuring essential services are still delivered to rural areas.
Considering this complex cartography of employment challenges, policymakers should draw up a road map designed to bolster resilience in global labor markets that can withstand any number of potential high-risk scenarios in the future, while accounting for pivotal employment trends.
Dedicated foresight units at the heart of governments should track emerging trends and engage in forecasts that account for various possible scenarios and risk factors. This includes determining which sectors will be of most strategic importance in the future, occupations in which job opportunities could be created, along with projected employment figures and the required qualifications and skills needed to perform these jobs and achieve satisfactory productivity levels.
At the same time, it is important to take note of the occupations that are likely to be lost to automation, technology and artificial intelligence. This will ensure economies have an adequate level of talent that can help them to remain competitive and resilient in the long term.
Governments should also reimagine education and lifelong learning systems to incorporate upskilling and reskilling programs that target the unemployed and young, migrant or aging workers. Training programs must equip people with a foundational set of skills that empowers them to transition between occupations, such as digital skills, social and emotional intelligence, and cognitive skills.
Furthermore, policymakers should work to develop a variety of job creation schemes that focus on employment in the private sector and entrepreneurial activity.
Investment in digital innovation will play a critical role in boosting productivity levels, reducing wastage, decreasing operating costs, and ensuring better geographic coverage of services. A particularly salient trend during the pandemic was the successful deployment of remote-working measures that facilitated the continuity of work in many spheres while delivering impressive benefits in terms of lower operating costs, reduced carbon footprints related to commuting and travel, and increased productivity. Equally important was the way in which remote working paved the way for engagement with stellar pools of talent all over the world.
On that note, the pandemic has also highlighted to employers the importance of implementing well-being programs that equip employees with the skills and knowledge they need to manage stress, be more engaged at work, enjoy a healthy work-life balance, and perform at optimal levels. Flexible working hours and hybrid-working models will contribute to retaining stellar talents in the job market.
Designing resilient, universal and sustainable social protection systems for workers will be instrumental in helping to protect them from future events that can temporarily shock the economy. They should target employees of all types, including permanent and temporary staff, essential workers in critical sectors, the self-employed, female workers, migrants, and lower-skilled employees.
The world is at a crossroads, with many salient employment trends changing the landscape of the world of work. By examining the various factors at play in the global labor market, policymakers can develop plans that will ensure a more resilient, equitable and productive workforce in the future.

Sara Al-Mulla is an Emirati civil servant with an interest in human-development policy and children’s literature. She can be contacted at

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