Asia-Pacific Unemployment Rates Rise Amid Coronavirus Pandemic
Last updated on May 19th, 2020
COVID-19 is not just affecting the health of people, it is also leaving a severe impact on the earnings of the people. It’s getting difficult for people to make a living during these tough times, impacting the survival of their families. According to S&P Global, job losses across Asia Pacific could double due to the coronavirus pandemic.
Service sectors will be hit first, an important sector for countries like South Korea and Japan, as it is the main source of job creation in these countries.
S&P’s Asia Pacific Chief Economist, Shaun Roache, said “Unemployment rates across Asia-Pacific could rise by well over 3 percentage points, twice as large as the average recession.”
Unemployment is another main reason behind the economic crisis, which would affect the growth and development of Asia-Pacific nations. Service sectors require face-to-face contact, but maintaining social distancing is crucial. This is hampering the operations directly.
Amid the coronavirus pandemic, S&P has predicted the impact of job losses among major countries in the Asia Pacific region.
- Australia – More than 3 percent
- Japan – More than 2 percent
- South Korea – More than 4 percent
- Thailand – Less than 1 percent
- New Zealand – Close to 3 percent
However, S&P has already revised Asia Pacific growth forecast of 2020 to 0.3 percent with china at 1.2 percent, India at 1.8 percent and Japan at -3.6 percent.
According to S&P, “In every economy, except Singapore, (job) busts happen much more quickly than (job) recoveries, whereas busts tend to last about six to eight quarters while recoveries take about eight to 10 quarters (or two to three years). This gap is especially high in Australia, Hong Kong, and (South) Korea.”
In most countries, the dependency on agriculture sector has been reduced with an increase in the service sector. Thus, the hospitality sector’s share of China’s total employment growth has been five times larger than that of factories over the past 20 years.
The aftermath of the coronavirus pandemic will leave a severe impact on the economy of every nation, leading to unemployment, poor standard of living and poor GDP. It will be hard for governments to overcome this without leaving a dent on the face of their country’s economic growth.
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