COVID-19 costs 6 million jobs as Europe slides into inactivity
There were 5.7 million fewer people in employment in the EU by spring 2020 than at the end of 2019, and 6.3 million fewer compared with the trend growth that could have been expected before the COVID-19 pandemic. Overall, in the 12 months leading up to spring 2020, EU employment declined by 2.4%, the weekly hours of those still in work dropped by nearly one hour and the share of workers employed but not working more than doubled to 17%. This job loss was not necessary reflected in unemployment statistics as, in the face of declining vacancies, transitions out of employment into inactivity outweighed shifts from employment into unemployment. This is detailed in Eurofound’s new report COVID-19: Implications for employment and working life.
The report focuses on assessing the first employment impacts of the COVID-19 crisis, including its effects across sectors and for different categories of workers. It also looks at measures implemented to limit negative employment impacts following the Coronavirus outbreak in Europe, including the development, content and impact of short-time working schemes, income support measures for self-employed, hardship funds and rent and mortgage deferrals. Particular attention is paid to the involvement of the social partners in the development and implementation of such measures and the role of European funding in supporting these schemes.
The report highlights that workers on temporary contracts have been disproportionately affected, with the number of temporary contracts in the EU27 shrinking by 17% between spring 2019 and spring 2020, with these losses accounting for well over three-quarters of the decline in aggregate EU employment. In Spain, where temporary work accounts for around one-quarter of all jobs, 930,000 temporary jobs had disappeared by spring 2020. In France, Italy and Poland, the decline accounted for over half a million jobs. Temporary employment was also particularly adversely impacted in Bulgaria, Greece, Slovenia and the Baltic states.
As with the financial crisis, younger workers experienced the sharpest declines in employment, as job recruitment largely ground to a halt. However, overall decline in employment during the current crisis has been more profound and sudden than in the aftermath of the 2008 financial crisis: employment levels in the EU27 declined by 4.9 million in the 12-month period from spring 2019 to spring 2020, a larger fall than the 4.3 million decline recorded in the two years following the financial crisis.
The report notes that this marked decline in employment would have been much more severe had it not been for the introduction of short-time working and similar schemes, as well as the shift to telework. It recommends the permanent establishment of short-time working or similar systems that can be activated in crisis situations, as well as the strong involvement of social partners and other stakeholders in these schemes to prevent unforeseen exclusion in relation to eligibility and other anomalies, contribute to fairness and ensure transparency and buy-in.
Speaking on the publication of the report Tina Weber, Eurofound Research Manager, said: 'This research shows the profound impacts COVID-19 on employment—behind these statistics are millions of jobs, livelihoods and businesses lost to the pandemic. But it also shows how, in some respects, interventions such as short-time working schemes have prevented this crisis from turning into a calamity, and details how measures can be reinforced to further protect the employment of the most economically vulnerable.'
Disclaimer: Please note that the COVID-19: Implications for employment and working life report was updated with revised data (specifically for Bulgaria) on 23 March 2021.
Download the report:
- Employment levels, Q1 2018–Q2 2020, EU27
- Change in employment, Q2 2019–Q2 2020, EU27 (%)
- Changes in employment, hours worked and share not working, by country
- Changes in employment, hours worked and share not working by age and gender
- Share of workers working from home during the crisis
- Changes in employment, hours worked and share not working, by occupation
- Employment shifts by job–wage quintile: two crisis periods compared
- Maximum replacement rates available through employment protection schemes
- Take-up of short-time working or temporary unemployment benefits
- Share of workers supported by employment protection measures in selected sectors