Pandemic seen to wipe out 1 million jobs of youth

by Ian Nicolas Cigaral (Philstar.com), 18 Aug 2020

MANILA, Philippines — Around 1 million young Filipinos are seen to lose their jobs this year, a direct result of the pandemic that prompted companies to lay off workers, cut work hours and freeze hiring of new graduates, a report released Tuesday said.

Jobless rate among the youth aged 15 and above is likely to hit as high as 19.5% by yearend if the coronavirus disease-2019 (COVID-19) is contained within 6 months, resulting into 1.02 million in job losses, the Asian Development Bank and International Labour Organization said in a joint report.

Job losses rise despite economic reopening

A slightly lower rate of 15.1%, equivalent to 687,000 youth jobs getting wiped out, may be recorded if COVID-19 is put under control within 3 months. When the virus containment started is unclear, although the multilateral agencies said it already “began at different times in each country.”

At any point of containment, youth unemployment is still expected to more than double from last year’s 6.8%, a scenario that is likely to reflect trends in the Asia Pacific region this year. “Young people will be hit harder than adults in the immediate crisis and also bear higher longer-term economic and social costs,” ADB and ILO said.

The report, which highlights the pandemic’s repercussions on youth employment across the region, casts a grim shadow on policymakers’ efforts to revive their economies, especially on countries like the Philippines which rely on their young workforce for economic prosperity.

Across the region, the Philippines is seen faring better in youth employment than Sri Lanka, which may see youth unemployment climb to 37.8%, Fiji (36.8%), India (32.5%), Mongolia (30.4%), Indonesia (25.3%), Bangladesh (24.8%), Thailand (22.1%) and Pakistan (21.5%).

Meanwhile, the local youth jobless rate is seen worse than projections for Vietnam (13.2%), Cambodia (13.1%), Nepal (6.1%) and Lao PDR (2.7%).

Government internships scaled down

Indeed, at the latest government Labor Force Survey last April, the jobless rate among youth already more than doubled to 31.6% year-on-year. Labor Assistant Secretary Dominique Rubia Tutay said government initiatives to salvage jobs are in “full swing.”

“Our youth programs such as Special Program for Employment of Students and the Government Internship Program are also ongoing though on a limited capacity,” Tutay said in Viber message when asked to comment on the report.

At the onset, COVID-19 and lockdowns enforced to slow virus transmission disproportionately hit sectors where youth are mostly employed. These were wholesale and retail trade where 23% of employed youths earn a living, accommodation and food services (11%) and manufacturing (10%).

Apart from layoffs among full-time employees, ADB and ILO said recruitments for internships and apprenticeships were also halted because companies were reeling from closures due to lockdowns. This comes on top of three-quarters of existing internships that were “completely interrupted as a result of the pandemic.”

If not let go, interns were easily left without wages and stipends after the pandemic struck, the report said.

The problem appears more severe if newly graduates are counted. In the domestic market, ADB and ILO said firms have no appetite to hire young people, or even if they do, job tenure, and therefore benefits, is something lacking.

Measures targeting youth needed
To “minimize future scarring” in the youth job sector, ADB and ILO said “large-scale and targeted” measures should be employed, including wage subsidies and offering government work opportunities, including apprenticeships.

“Prioritizing youth employment and maximizing youth productivity in the COVID-19 recovery process will improve Asia and the Pacific’s future prospects for inclusive and sustainable growth, demographic transition and social stability,” the joint report said. — with Prinz Magtulis