Workers without a diploma are the hardest hit by the Covid-19 crisis – study
Workers without a university degree will be hardest hit by the Covid-19 crisis, raising fears of rising inequality Europe, where up to 59 million jobs are at risk.
New research from McKinsey consultancy says nearly 80% of workers facing job insecurity – including reductions in hours or wages, temporary leave or permanent layoffs – have no University diploma.
Those at risk include retail workers, cooks and actors, as well as construction workers and office support workers, who are twice as likely to be affected by livelihoods during the epidemic. because they work close to each other and have significant exposure to the public.
Low insecurity occupations include workers who do not need to work in the immediate vicinity of others, such as accountants, architects and journalists, or whose work provides essential health services, such as personnel health or other essential services such as police, food production, education, public transport or public services.
Research fears that the coronavirus epidemic may widen the gap between the rich and the poor across the EU and the UK. “Short-term employment risk is strongly correlated with education level, which could worsen existing social inequalities,” said McKinsey.
The warning came as the UK coronavirus retention program began to accept requests for government support from companies that had put their staff on leave.
While many countries, including the UK, have rolled out massive stimulus packages to help ease the economic blow of national closings, McKinsey warned that Europe could still face social unrest due to the rise unemployment.
“Societal inequality is exacerbated by higher unemployment rates because social protection systems cannot fully mitigate the negative effects of job loss. Rising rates of crime and social unrest are also potential consequences of increased unemployment, “said McKinsey.
“In addition, the unemployed are twice as likely to suffer from mental illness (and even more so for blue-collar workers), and they are more likely to receive hospital treatment,” added the report.
In the UK alone, up to 11 million people could be on leave or unemployed in the next three months, according to a separate study by the Resolution Foundation, which also found that low-wage workers would be the hardest hit.
But the foundation said that the UK coronavirus job retention system – in which the government will pay 80% of a worker’s salary, up to £ 2,500 per month – has so far protected the UK from the worst of economic shocks. Foundation economist Daniel Tomlinson said the program “is what lies between Britain, which will experience high unemployment in the coming months and catastrophic levels of long-term unemployment during the Great Depression.
“It is particularly essential in large low-wage sectors such as hotels and retail, where around half of the workforce no longer works,” he added.
Around 46% of workers in the hotel and retail sector in the UK are expected to be on leave, compared to only 4% of workers in the highest paid sector, insurance and finance.
British chambers of commerce estimate that two-thirds of companies have laid off some of their employees. “Opening the job retention program is an important step for businesses, which can now begin to access the money they need to pay their workers and protect their livelihoods,” said the director. General of the BCC, Adam Marshall.
McKinsey research also found that younger workers aged 15 to 24 are also twice as likely to experience job instability during the epidemic compared to their older counterparts. However, Sebastian Stern, a senior partner at McKinsey, said the long-term impact on young workers would depend on how quickly governments start to come out of the lockdowns.
“If we come out of lockdowns as soon as you can justify it and invest in the right kind of industries, I wouldn’t say it’s already a lost generation,” said Stern. “[But] we have to get the right answer. “
It is still too early to say how many at-risk workers could ultimately lose their jobs, but Stern said it was not all bad for European companies and their workers. He said the epidemic will force some industries to manufacture new products or introduce new work practices that would otherwise have taken years to adopt.
One example is the German automotive sector, which was already moving towards the production of electric vehicles. “The stimulus packages and the investments that flow from them could encourage and accelerate structural change,” said Stern.
“If governments decide they want to invest in this sector by pushing electric vehicles, you see that it will accelerate structural change in this industry.”
Meanwhile, customer demand will force more food, clothing and luxury goods retailers to connect online, while more white-collar workers will be encouraged to work remotely.
“If we succeed, we have the opportunity to address some of the challenges of inequality, and we also have the opportunity to address some of the structural economic challenges we have before us,” said Stern.