The global auditors of the state of the global economy give disappointing forecasts. The world of the pandemic of coronavirus is forced to rebuild, especially has changed the labour market. How it will affect the Ukrainians and are they ready for change?
Recognized international institutions continue to give pessimistic forecasts concerning global development in the background of the pandemic COVID-19. Special emphasis on the labour market, which will be reformed in the first place. He will undergo such changes that will have to rebuild everything. Especially “innovations” will hit developing countries, which include Ukraine. The prospects for economic models
What predicts world leaders in the field of Economics? The head of the European Central Bank, the former head of the International monetary Fund Christine Lagarde believes that coronavirus crisis will accelerate the transformation of the world economy. All will lead to massive automation, will increase the importance of shorter supply chains and environmentally friendly industries. And all this would have “devastating force”.
But there is in the words of Lagarde and some optimism – “the crisis will strike on employment and production in the first two years, after which expected growth of productivity.” “The supply chain will be reduced by approximately 35%, and the use of robots will increase by 70-75%,” – quoted Lagarde to Bloomberg.
In her opinion, will increase the role of online retail payments, therefore, the EU should create a single digital market. However, she warned that the pandemic serve to increase inequality with economic and social consequences, and that the ECB will have to take into consideration. According to her, in the Euro area about two years there will be a reduction of pressure on prices, but then a fracture may occur.
It is worth noting that earlier Lagarde said that Eurozone countries were the hardest stage COVID-19, however, the authorities need to prepare for possible second wave, and the Eurozone economy due to a pandemic, it may fall by 15%.
A disappointing study released in late June, and the international monetary Fund. It significantly worsened the forecast of falling of the world economy in 2020 to 4.9% from 3%. And recovery, according to the IMF, it will be slower than previously thought. All because of a “pandemic” uncertainty “tackling coronavirus was not found, and the way out of the crisis is unclear.”
“As in the April projections, there is a high level of uncertainty about the forecast. The economies of emerging and developing countries in 2020 will fall by 3% (against a projected 1% previously), and in 2021 will grow by 5,9% (the previous forecast – an increase of 6.6 per cent)”, – stated in the IMF survey.
The numbers are a shock: the decline of US GDP in 2020 will be 8%, and a recovery in 2021 and 4.5%, Germany – 7,8% drop in 2020 and 5.4% of recovery in 2021. The largest decline is expected in Italy and Spain – 12.8%, the growth in these countries next year is forecast at 6%. In France, the decline would be 12.5% growth 2021 – 7.3%. UK GDP will fall in 2020 to 10.2%, although previously, the IMF expected a decline of 6.5%, and in 2021 will grow by 6.3%.
The IMF notes that the pandemic COVID-19 was forced to close the border, which helped to contain the virus and save lives, but this triggered the worst recession since the great depression. The Fund warned that, because of what is happening, more than 95% of the countries income will fall per capita.
As for Ukraine, the IMF forecasts, GDP in 2020 will accelerate to 8.2% (previously the figure was 7.7%). Although there was an updated forecast of recovery of the Ukrainian economy in 2021 – with a minus of 3.6% to 1.1% increasing to 3% in 2022.
A more optimistic forecast of the world Bank – the contraction in global GDP this year could reach 5.2%, while the recovery will be less protracted. Regarding Ukraine – compared to the previous forecast, expectations had deteriorated to GDP will fall this year by 7.2 percentage points and 1.2.
All of this suggests that the domestic economy will follow the global trend to decrease. This means tightening employment market. That is, business optimization, and as a result complete or partial loss of a job, reduction in income.
What happens on the Ukrainian employment market
According to the State employment center at the beginning of July, the number of only officially registered unemployed is almost 516,7 thousand people, which is 81%, or 231 thousand more than at the corresponding date last year. Unemployment assistance is getting 432 thousand people. And for one vacancy claim 9 unemployed (on the corresponding date of last year – 3 people).
From March 12 (the beginning of the quarantine) on July 1, the State employment service was 328,6 thousand unemployed, which is almost twice more than in the corresponding period last year.
With regard to the government’s plans to create half a million new jobs, domestic statistics about this “silent”.
However, we must recognize that there’s much hope on that – the programme activities of the Cabinet and is not accepted, two attempts have already failed. And how it can be done in the current environment – despite the global economic contraction? However, shifts in the labor market occur.
The desire to survive
As the findings of “recruitment” portal grc.ua although unemployment and the General crisis in professional fields and industries – a global phenomenon, and the data for Ukraine in General, coincide with the report of the International labour organization, but the impact of coronaries in our country has its own characteristics.
For example, particularly mass layoffs during the period of quarantine was not recorded. The business is trying to save their States, going to all sorts of “tricks” – forced unpaid leave, reduction of working time, etc, according to the poll, “exit” was only 6% of respondents. Among them: HR-managers, marketers, IT specialists, administrative personnel, workers in the HoReCa, sales professionals. However, significantly reduced the number of employees of hotels, restaurants, tour operators, beauty salons, non-food retail. But with the easing of quarantine to make up.
In addition, according to the report of the International labour organization, the most in the world suffered from coronaberis young professionals under 24. This is attributed to the fact that such workers are often involved in low-paying industries and sectors, and they were less resistant to the crisis, have less work experience and less valuable to employers.
In Ukraine everything is different: according to the survey grc.ua often dismissal during the quarantine, reported by applicants at the age from 31 to 40 years (related generation X-Y) – account for almost half (48%) of the answers. Another 20% of workers that have been cut, the age is from 24 to 30 years (millenial) and from 41 to 50 years (generation X). But representatives of generation Z (respondents aged 19 to 23 years old) less likely to report dismissal (12%).
The explanation is simple: young people are often specialists in other age groups involved in the areas that were in demand during the crisis. Besides, they are willing to work in positions connected with administrative work (translators, operators, call centers, couriers). And since such jobs are actively placed in the hard period of quarantine, even in case of reduction of these people could quickly find another job. Another “local” factor in the Ukrainian market in most cases, employers do not place high requirements for experience.
“Although the absolute majority (71%) employers were able to preserve the natural turnover of staff, in terms of material motivation of employees the situation is more complicated: in the coming months, 35.2% of employers are going to reduce the wage, while 64,7% said that they will leave in the future the current level. However, at the same time, almost half of the respondents reported that material motivation of employees has reduced,” – noted in the study by HR portal.
Spotted a very important indicator – every third Respondent (34%) willing to change the profession: 22% – because of lack of prospects (financial or intangible), 12% – because of disappointment in this profession. And half of respondents are ready to re.
Ukrainians are aware of the prospects of the future which draws coronaries. They are willing to change, learn and transform. And this is important for economic recovery. Only the state should be helping them. Without support nothing will happen. The country needs a government program post-coronaridine life.