Youth job losses set to top 100,000 this year due to COVID-19 crisis: study

• Cautions SL’s youth unemployment rates could double end of the year
• Notes, nearly half of young people employed in sectors hardest hit by crisis
• Urges govt. to absorb youth to wider labour market and economic recovery measures

By Nishel Fernando
Job losses among Sri Lanka’s  youth is projected to top 100,000 this year as a result of the COVID-19-induced crisis,  driving the country’s already high youth unemployment rate above 30 percent, according to a latest report.

A joint publication of the Asian Development Bank (ADB) and the International Labour Organization (ILO) tilled ‘Tackling the COVID-19 youth employment crisis in Asia and the Pacific’ projected that Sri Lanka’s youth (15–24 years) would lose 102,000- 151, 000 jobs this year with the impact of the pandemic, adversely impacting the country’s economic output.
The ADB has projected Sri Lanka’s economy to contract by 6.1 percent this year driven by the COVID-19 crisis. 

“The pre-crisis challenges for youth are now amplified since COVID-19 hit. Without sufficient attention, our fear is that this risks creating a ‘lockdown generation’ that could feel the weight of this crisis for many years to come,” a lead author of the report and Head of the ILO Regional Economic and Social Analysis unit, Sara Elder said.

Sri Lanka already had high youth unemployment of 21.1 percent before the COVID-19 crisis.

 The ADB-ILO joint study projects a sizeable jump in the country’s youth unemployment. It cautioned that Sri Lanka’s youth unemployment could rise between 32.5 and 37.8 at the end of this year, nearly doubling current rates. 

According to Sri Lanka’s Department of Census and Statistics (DCS), the unemployment rate among youth jumped to 26.8 percent in the first quarter 2020, accounting for more than half of overall unemployed persons in the country. 

Moreover, the unemployment rate among young females was 36.3 percent compared to 21.1 percent for young males.

According to the report, one of the reasons for young people in the region face greater labour market disruption and job losses compared to adults is that, nearly half of them were employed in the four sectors hardest hit by the crisis—the wholesale and retail trade and repair; manufacturing; rental and business services; and accommodation and food services. 
Young women are overrepresented in three of the four most affected sectors, particularly in accommodation and food services.

In Sri Lanka, retail trade is projected to account for 13.7percent of youth job losses followed by 11.2 percent in hotels and restaurants sector, 11.1 percent in construction sector and 10.1 percent in textiles and textile products.

The report cites three ways in which young people are affected in the current crisis—job disruptions in the form of reduced working hours and earnings, and job losses for both paid workers and the self-employed; disruptions in their education and training; and difficulties in transitioning from school to work, and moving between jobs in a recession.

The report recommended urgent, large-scale and targeted responses, including youth-targeted wage subsidies and public employment programmes, and measures to mitigate the impact on students of the disruption to their education and training.

It stressed that the governments should consider balancing the inclusion of youth in wider labour market and economic recovery measures, with youth-targeted interventions to maximize effective allocation of resources.

“Prioritizing youth employment 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,’’ Head of the ADB NGO and Civil Society Center, and leading ADB’s Youth for Asia initiative, Chris Morris said. 

Otherwise, the report cautioned that the COVID-19 crisis would affect young people’s transitions to and within labour markets, and could result in scarring effects, compounded by the forced suspension of education and training.