 Welcome to the policy panel of the 2020 jobs and different conference. Employment effects of the COVID-19 pandemic in the global South. What have you learned so far? I could now send the director to UNEWIDE and I'll be moderating this panel. The COVID-19 pandemic represents the unprecedented global crisis with far-reaching implications on the working poor in developing countries. We are now seven months into the crisis and we can already see significant negative effects on employment and earnings in the global South. At the same time, several countries in the developing world have enacted ambitious programs to mitigate the effects of the crisis. In this panel, we'll take talk of what we know about the employment effects of the crisis as well as the effective response that you've seen so far. We have a different set of scholars and practitioners with us in this panel and I'm going to introduce them in speaking order. So the first panelist is Indira Santos who is a global lead for labour and skills in the social protection and jobs global practice at the World Bank. The second panelist is Sangyam Lee, the director of the Employment Policy Department of the ILO. The third panelist is Marti Chen who is Senior Advisor Vigo, Lecturer in Public Policy, Harvard Kennedy School and the member of the wider advisory board. The fourth panelist is Haroon Borath, the Professor of Economics and Director of the Development Policy Research Unit at the University of Cape Town. He is currently the Economic Advisory Council appointed by the President of South Africa and ISD, a research fellow and also a member of the wider advisory board. I would like the panel to speak to two questions. The first question, what do we know about the employment effects of the COVID-19 pandemic in the global South? The second question, which policy responses have worked best in continuing the effects of the COVID-19 pandemic and the livelihoods of the working poor and what can be done more by Southern governments and the international community? Two questions. I would like each panelist to speak for 70 minutes, each in the initial interventions followed by a short round of two minutes each for responses and comments in each other's remarks. And then I'm going to open up the discussion to the Q&A session and I've asked the audience to send your questions to me by the chat function that you see in front of your screen. Do not wait till you hear all the interventions. As you think of questions, keep on sending them and I will collect them and ask the questions on your behalf. Also, do note that this particular session is being recorded. So, let's start. And I would like to ask Indira Santosh to make the first initial intervention. Indira, over to you. Thank you very much. It's an honor to be part of this panel. I will leave it to Sanjio and actually to provide us with a global picture on labor marketing impacts based on the ILO work. But I think there's little doubt that many firms, workers, and families are hurting. According to World Bank estimates, the global extreme poverty rate is expected to rise for the very first time in over two decades. And as we discussed in the previous session, impacts go well beyond poverty. The crisis has revealed the extreme vulnerability of those in formal employment who account for the majority of workers in developing countries. There are also concerns about a generation COVID-19 encompassing recent graduates, first-time job seekers, and unemployed who may be scarred in the long term from this crisis. Women and youth in many settings are being also disproportionately affected, exacerbating some of the pre-existing inequalities. Hard numbers are starting to combine in some developing countries at the World Bank. We monitor these impacts through our jobs-watch initiative, which is based on high-frequency phone survey data on households and firms in more than 100 countries. By June, for example, in Latin America, countries like Colombia, Peru, Costa Rica, Ecuador, around 25% of occupied workers report that they lost their job since the lockdown. And for most of all the countries monitoring the region, around 70% of households report decreasing household incomes. Disemployment impacts are likely to be long-lasting and may exacerbate as the support that countries have provided actually fades. Some industries that are an engine of employment like tourism effects are expected to last well beyond the lifting of the travel restrictions. Even when countries get COVID-19 under control, the global economy is in recession. And finally, we expect structural changes in employment, linked to changes in international value chains, for example, or the acceleration of trends such as the digitalization of commerce and business, and this will add to the employment challenge. Let me turn to the policy response. I would like to frame it today as the good, the bad, and the ugly. Let me start with the good. Countries reacted quickly and with unprecedented strength. At the World Bank, we count more than 1,000 social protection and labor measures adopted to date in response to COVID and virtually in every country around the world. 60% of those measures are associated with social assistance, mostly cash transfers, mostly new programs. A little bit more than 20% are social insurance measures, strengthening mostly unemployment benefit systems. And the other 20% are largely supply-side labor measures, mainly wage subsidies, which have been put in place in around 80 countries worldwide. Labor market support has come mainly in three forms, liquidity support for firms, measures aimed at preserving employment linkages, particularly through wage subsidies, and income and income support, such as transfers, intermediation, and risk killing for the vulnerable. I would argue that the jury is still out on the labor market impacts of these measures and because they may bring not only in terms of fiscal aspects, but also in terms of labor market dynamics. I think there are some positive indications. However, first, most of the measures put in place have some backing, I think, on what we know from the literature on impacts of labor measures during crisis. Second, the measures seem to have been effective in their immediate goals, protecting jobs, income, or both, among the targeted population. Across the OECD, for example, job retention schemes have supported over 50 million jobs, 10 times as many as during the global financial crisis. At the World Bank, we estimate that measures have also been effective in alleviating poverty and welfare impacts. And finally, some of the fears of labor market disincentives, given the strength of the response, do not seem to be bearing out, at least yet, as emerging evidence, for example, from the United States around the CARES Act seems to suggest. Now, let me turn to the bad two points I would like to highlight. First, in terms of informal workers, while they are the overwhelming majority of workers in most developing countries, most measures put in place in response to the crisis do not really reach this group effectively or at scale. There have been some efforts, cash transfers, linking them to microfinance institutions, but I think the crisis has shown the extent of the challenge and the limitations of our tools. Second point, I think the trade-offs between providing relief to households and firms on the one hand and supporting an economy's restructuring on the other become starker as the crisis and policies measure are extended. Think about policies that have protected jobs, like wage subsidies in Europe and that have been imitated around the world. There are clear trade-offs here with the approach being kind to workers and firms while the schemes last, but running a risk of supporting zombie firms and jobs that may be unsustainable. Then going forward, it will be key for countries to shift away and change the nature of the labor market support that they provide. The question is whether countries will be able to do this adequately. Support will need to become more targeted, less generous, and shift towards supporting job creation in promising sectors, re-employment, and productivity, including transitions to new jobs. And I would argue, and we can discuss further later, that we are already seeing some of those shifts. Now, the ugly. I think on my mind there are three big concerns. First is that the fiscal space for further responses is very limited. Given that most countries weren't bazooka on many of the measures, and there is an expected global recession that will outlast the pandemic itself. So I think going forward, it will be ever more difficult to respond to any new wave or further needs. Second, it is becoming apparent that this crisis is generating structural shifts in the labor market, and that will become increasingly challenging. And a third concern is that, particularly for affected groups in the crisis, women, youth, and low-skilled, many of the gains that have been made in the last decades could actually be lost, given concerns one and two expressed earlier. Let me conclude on a positive note. There are many lessons, I think, from COVID-19 in terms of the strengths and weaknesses of policy responses to crises like this one. At the World Bank, I think we are confident that these crises will represent the before and after on how we think about productivity and protection of informal workers. We hope it will make us think more systematically about how to protect all workers independently of how and where they work, in ways that move us away from systems finance, mostly by labor taxation, that effectively limit protection just to formal workers. We are also confident that investments that are being made today, in terms of digitalization of service delivery, in social protection and labor programs, so digital IDs, digital payments, will also help make countries more resilient moving forward. And with that, thank you very much for this opportunity. Thank you so much, Indira. Let's move on to Sangun Lee. Sangun, do you want to make initial remarks? Thank you so much, Konar, for your kind invitation. I'm very excited to be here. As you know, the pandemic is continuing, actually, to evolve. And so the assessing the market disruption at this moment, whatever we do involves quite a high level of uncertainty. So we have to live with it. And also, when it comes to projecting what's going to happen in the coming months, and especially in the second half of the year, it's even more uncertain. But still, it's very important, in our view, to monitor and analyze the labor market impacts with the best password data method, and then updating on the regular basis. And it's a way of helping the countries to develop timely and informed policy responses. This is why, actually, we have done a lot of analysis through the idle monitor on the COVID-19 and the World of Work. We published, so far, the five editions. We are working on the next edition. It's going to be published this month. I have very limited time, so I just want to share some of the findings with you very quickly. But people are doing that. I just want to mention one important premise for our analysis, which is about the lot of unsuccessful, in my view, unsuccessful experience from the Great Recession. Probably, as you remember very well, the mainstream policy response at the time was largely characterized by, I mean, in my view, a bit trickling down recovery measures, which actually is somehow resulting in another slow economic recovery, and also greater social and political uncertainty. And also, you remember very well, the recovery in employment and the labor income was even slower and also more painful, I must say, which in turn contributed to the further slowing down of the economy recovery and also depressing productivity growth as well. If we look at the global unemployment, it took almost 10 years or decades to return to pre-crisis level. While use unemployment, unemployment never managed to fully recover from the crisis. So in a sense, the economy and the employment has been disconnected in the recovery process. And similarly, this is the very familiar story, that productivity continues to grow in the recovery process, but wages and the income tends to lag behind. So as a result, all of this inequality remains high in some cases growing, and this is why actually the crisis response was wider understood, a bit of the overall failure of the trickle-down economy. So I think the important starting point for us in talking about the how-to response to COVID-19 is that, in my view, we shouldn't repeat such a mistake in this crisis. So having said that, what is the overall magnitude of the landmark disruption? In the beginning, actually, we used a very standard modeling, which predicts annual average rate of unemployment. And then it's soon very clear that looking at annual and unemployment is insufficient, and in some cases, it's even misleading. Because the annual average do not reflect that the reality as a situation is evolving very rapidly, and at the same time, unemployment does not indicate the actual scale of disruption for workers, because many people actually keep the jobs, but they are not working. At the same time, they are lost the job, but they completely move out of the labor market, they do not search for jobs. And also, many of the people are working shorter hours. So these are not very well-captured in the standard unemployment figures. And at the same time, we need to match a shorter time horizon, like month or quarter. So this is why actually we are actually looking at the working hours losses, actually using the now-casting order, which takes full advantage of the high-frequency data. Actually, let's look at the second quarter only. Initially, I mean, at the very beginning of the second quarter, we estimate around 7% of losses of working hours, but over the last three months or something, we made up all the adjustments. So we are now talking about 14% percent. Of course, this actually working hours loss includes economic eating activities and labor market withdrawal and unemployment, temporary suspension of work, and shorter hours, all of this. This actually working hours losses of 14% percent are equivalent to the 400 million full-time job. If we assume 48 hour work week, it's tremendous. It's unprecedented. All the reason, wherever you look at it, we also do two-digit losses. Probably the largest reduction in my calculation is now in the Americas, Latin America and the U.S. But we just recently heard from India about the GDP figures. So it's 14% strong. So we think that the labor market share may be much worse than we initially anticipated. Anyway, this is the unprecedented scale of labor market disruption, which basically affecting every single person in every single country. And by the same time, these impacts are a bit disproportionate, and also making certain segment work processes even more vulnerable. So to demonstrate this, the group, and let me briefly mention three groups, informal workers and youth and the women. First, the workers informal economy. India already mentioned that. I'm sure the market chain will give a little more detail, actually, the picture of the situation. But as you know, right now, the overall workforce is around 3.3 billion. And out of that, two billion workers are engaged in informal economy. Out of these two 6 billion, we think the 2 billion around 1.6 billion are estimated, in our view, impacted by crisis, either because of the lockdown measures or other reasons. Impact on the income and poverty for the informal workers are very massive. And we expect very first months of this crisis, without any government support, anything, the income of the informal workers may decline of the 60% globally. This actually massive income effect has much to do with the very nature of the pandemic. The informality is often seen as the last reserve option for survivors. But this option has often seems to be viable because of the lockdown measures, which actually restrict the movement and agron activities. So this result in the high income risk for informal workers. That's informal workers. So what about the young people? As I mentioned earlier, use unemployment rate has never recovered from the great recession. It's still, before the pandemic, it stood at around the 13.6%. Now, of course, that does not include many more million workers who are not in actual education and training, but can be inactive. But one of the defining features of this crisis is the simultaneous show. It's not just about the labor demand, lack of the work opportunity. At the same time, it's special because the young people, the learning opportunity are severely damaged as well. So on the demand side, we think around 178 million actually young people are working currently in the sector, which are hit very hard by the pandemic. And actually, we did some survey with some UN agencies and other private sectors. In that survey, we found one in six young people have to stop working since the start of the crisis because of the pandemic. And on the supply side of that is that in our survey, again, it's done with the World Bank as well. And more than 90% of TVED institutions, they closed down. They shift to the online courses. And of course, the online courses in the advanced country could be better, but in different countries, I mean, the quality of the online courses is quite a mix at the moment. So which means we have a demand shot and the supply shot. If we can put together and this just continue, we have to expect quite a significant scarring effects. So if that is the case, we are very much worried about the possibility of the lockdown generation. I mean, this young generation will continue to suffer throughout their working lives. Very quickly on gender is the same. But our main concern is that all the gains we have achieved in the recent years in the gender equality in the labor market, those gains may already been actually described in many different ways. One is women are more likely to work in the hardest sectors than men. And the second, domestic workers. At least the more than 70% domestic workers do not have the social security coverage and they are at risk of the losing job. And also women are representing more than 70% of those in the... Women are representing more than 70% of the jobs in the health and social work. You know, these actually jobs are exposed to the direct risk of the virus and on top of the local and the program condition. And also there is a big concern about the care because of the closure of the early childhood education and also lack of the care support. We see the over distribution of the care work within the family is more and more the working against the women. So it is more unequal than before. So let me conclude with some of the remarks. Within very much of this pandemic will fade away in the second half of the year. We initially hope so. But I don't think that's going to happen because we see the more infection numbers in many countries and forcing still countries actually continue to rely on the local measures on different kinds. And there are huge support from the finance support and also this is a very important issue. When it comes to policies, I don't have much time, but I want to mention one thing here is that the policy design is very important. I mean, the India already indicate a very important element in there. But we are more worried about the lack of the resources itself. And so in two ways, one is the case of a developing country with a very limited physical resources. I mean, even though with the best policies, I mean, there is no resources available at the moment. So how can we mobilize global support for a developing country? It's very important. The second, the previous sector crisis, global recession, we saw how the premature physical consolidation played out. So we simply don't want to see these things will not happen again. So we are very much worried, the advice against about the premature physical concentration, which would risk actually further destabilizing the already very weak active labor market. Thank you. Thank you very much, Angan. Let's move on to the next panelist, Marti Chen. Marti, do you want to make an initial intervention? Thanks, Kunal. It's really a pleasure and honor to speak on this panel. And as Angan predicted, I will focus on the informal workforce. And we'll draw on findings from the Wego Network. We did an early rapid assessment. We've just completed a 12th city study, and we have weekly contacts with organizations of workers. Just to re-echo what Seungyeon said about the fact that 61% of all workers, 2 billion, are informally employed, and that there is a significant overlap. The 2018 ILO estimate suggests a significant overlap between being informally employed and being from a poor household. And I would add that wherever we work, we also know that informal workers tend to be from disadvantaged communities by race, ethnicity, and caste. Before this crisis and for the last forever, I guess, policymakers tend to see informal workers' enterprises and activities as a problem to be dealt with. And you all know that they are assumed to evade taxes and regulations, deal with illegal goods and services, represent unfair competition, have low productivity, and so forth. And the reality is that most of these informal workers are from poor households and are trying to earn an honest living in a hostile policy and regulatory environment. That's before the crisis. And as Seungyeon said that ILO earlier this year estimated that 1.6 billion of these informal workers, 80% of them, would be negatively impacted in some way by the decline in work associated with the policy responses to the virus. And that during the first month of the crisis, informal workers globally would experience about 60% drop in income. So, Seungyeon, I'm happy to report that the preliminary results from our 12-city study, we only have tabulations so far from eight of the cities. And this was a study on the impact of the pandemic cum lockdowns on the livelihoods of informal workers. And we can confirm your ILO estimates. In six of these eight cities, 80% or more of informal workers in the sample were not able to work during April. And April was seen in all cities across Asia, Africa, Latin America, and also New York City was in our sample in Plevin, Bulgaria, was the peak month for restrictions and lockdowns in all the cities. And the loss of income meant I mean, loss of work meant right away loss of income because they rely on daily earnings. And the economic crisis overnight became a food crisis for these workers. So, a common lament that we heard across these cities is we will die from hunger before we die from the virus. Now, the two exceptions where 80% or more did not live work, one was Bangkok, Thailand, where around half lost their work. But this was in large part because the street vendors and the motorcycle taxi drivers in the sample were assumed to be essential workers in that city and were allowed to continue in some way. And the other city was Dakar, Senegal where we only studied one sector for a variety of reasons. And this sector was waste pickers, all of whom work at one large dump. And many of them are migrants who live near the dump so they were able to continue to work. But I should add that even those who continued to work, you know, the incomes had plummeted. By late June, early July, after the restrictions had been eased in most cities, in half of the cities, half or less of the informal workers were able to resume work. And then the other half, which included Bangkok and Dakar as well as Accra and Plevin, Bulgaria, between 80% to 90% were able to resume work. But again, the incomes had not recovered. They bumped up a little bit because they'd resumed work but they were nowhere near the pre-COVID level. In sum, what we say is that livelihoods were immediately turned off where strict lockdowns were imposed but livelihoods were not immediately turned on when lockdowns are lifted. I mean, recovery, like Sung Don said, takes a long time. And we know that because we also did two rounds of a study after the global recession. So what is it that these informal workers want and need to restart their livelihoods? One is that they want recovery cash grants. Many of them have received emergency cash grants and that's been very helpful. Although we have lots of evidence that not all who are eligible did but they want the cash grants to continue because most had to deplete their savings and many went into debt. And so they simply don't have the money to buy, stock, and restart the businesses. Another problem is that the supply chains in which they operate are broken and those need to be repaired or restored. So if you're a home-based producer in a manufacturing supply chain, one of our sample cities is the T-shirt capital of the world, Tirupur in India. Unless they get the work orders from the factories and the suppliers, they don't resume work. And the factories were allowed to resume, were allowed to open and rehire all workers in June but they haven't because they haven't received the domestic orders or the export orders from that chain. So the home-based workers are sitting idle still. Street vendors, if you think of the food supply chain, unless and until the natural markets of street vendors are opened, which they aren't in many cities and the wholesale markets are operating again and the farmers are able to produce and sell, that whole food supply chain is very vulnerable and we see that operating. The recycling supply chains, street vendors have, I mean the waste pickers have gone back to work in many cities because their service is seen as essential. They help clean and reclaim waste. But unless the scrap dealerships and the waste recycling plants are reopened and the markets for these reclaimed waste goods is not restored, they can be working but earning nothing. So we have workers who are working and earning nothing at this time. So these supply chains are really important. So it's not only the global value chains. It's not only the global economy. It's very localized as well, those supply chains. And of course they need increased demand. If you're a street vendor, you sell to people who tend not to be too wealthy and their incomes haven't suddenly bumped back up. So they're very worried about the demand. They need safe public transport. They're commuting to and fro work and they're being accused of being vectors of the disease but they themselves want to be safe, right? And so public, you know, adequate safe public transport is hugely important to them to return to work. And then we want them to be not stigmatized as the vectors of the disease, which there's increasing stigmatization. And we had a webinar with domestic workers from India last week and one domestic worker in Delhi put it. She says, quote, we don't go to malls and markets. Our employers do, but they see us as putting them at risk while I put myself at risk working in their homes. So I think this sort of assuming that the poor are the vectors we have disease and a drag on recovery, we really need to fight that stigmatization. And we do see that happening that in the name of public health, in the name of recovery, we see a lot of flash points where informal workers are not being allowed to work or their market infrastructure or their waste collecting site are actually being destroyed. There are a lot of flash points now. So it's not getting easier with the lifting of the restrictions. And as we all know, I just wanted to conclude with this, that the world is at an inflection moment. The economic system is in crisis. And the COVID crisis of the pandemics and the lockdowns have exposed economic injustices and inequality around the world. And more specifically, they have exposed that those who provide essential goods and services do not enjoy essential rights. Many of the health workers do not have health insurance as most of them are informally employed. So if we're really going to reduce these economic injustices, inequality and poverty, the global community needs to commit to several things. One, to investing in strengthening the supply chains for essential goods and services, the local systems of production and consumption, ensuring universal access to social protection and not just social assistance, social insurance as well, and good quality public services. They need to regulate markets to limit the power of capitalists to undermine the worker rights and to undermine the small informal enterprises that supply to them. And we do need to redistribute wealth for appropriate tax policies. And finally, we do also need to end police and state violence against the poor and disadvantaged communities, including the working poor in the informal economy. We see and hear reports of police violence against these workers being exacerbated during this time. It goes way back, but it's also exacerbated. And this will require challenging the dominant narrative that stigmatizes informal workers as a problem rather than recognizing their contributions in providing essential goods and services. So we need to build on the current recognition of frontline workers. We're clapping and singing for them around the world. So let's build them into our economic recovery plan. And we need to have a collect, we recognize the basics now. It's really nice to be back to basics. Our collective need for essential goods and services. So we need to start rebuilding the economy from the bottom up. We can't rely, as Sanjohn said, the trickle-down doesn't work. We need to build it from the bottom up by extending legal and social protections to frontline workers and building more resilient and equitable systems for providing the essentials of life. Food, housing, clothing, health, and education. And so, like Indira, I have a bad old deal, a worse new deal, or a better new deal. We have three choices, folks. We go back to the old bad deal for informal workers. We could very easily slip into a worse new deal. But what we want, I hope, is a better new deal for informal workers. Thank you. Marty, thank you so much. Haroon, would you like to make your opening remarks? Great. Thank you. Thanks very much, Kunal. Now, in the run-up to the organizing of the panel, Kunal said a brief, I'll just sort of quickly reflect on him and repeat them and then try and at least give you some thoughts based on the question. So the first, Kunal asks us, so why can the employment effects of COVID-19 in the global south? The second is what policy responses have worked best in containing the effects of COVID-19 on the livelihoods of the working poor. And then finally, which I won't really spend too much time on because I'll run out of time by then, is what can be done more by southern governments and the international community. So just to be clear about the first one is what do we know about the employment effects of COVID-19 in the global south? Now, of course, from Sangeon and the World Bank's sort of vantage point, there's a lot of sort of collation of data and so on, at least from the country level, and I should say I sort of at least use South African data to anchor my comments. A lot of the empirical estimates about the employment effects from COVID-19 will actually come from our level four survey data. Now, the latest we've seen from the ILO stats figures, for example, right, is there are about 168 countries that report in the ILO data having some sort of a level four survey or another, right? There are only 39% of those countries, 65 of those countries that actually have regular level four survey data. And to be clear, of those 65, only 22 are developing countries. So you've got a really, really small sample of countries that are producing, developing countries that are producing regular level four survey data. That's the core of what you need to actually empirically answer the question about what the employment effects are of COVID-19. So nothing else. There's a really important data point here, is that perhaps the biggest pandemic the modern world has faced, right? And the first key question, right, around level markets, we can't actually empirically answer carefully enough just because there's a shortage of level four survey data. I must add that of those 22 countries, only two are in Africa and one of them is my own country, South Africa. So it's essentially the question about, if you think of it as a second quarter level four survey question, which is between, right, April, May and June, what were the labor market effects that we saw, most countries can't answer that, right? And if they do answer it, they're going to be answered pretty late. My own country will answer it, hopefully by the end of October or end of September when the data is released. But the whole bunch of countries, the large majority of whom we actually can't empirically and accurately answer that question. So with that in mind, just sort of backdrop about the poverty of data, so to speak, are there ways in which, and this is really sort of for country level researchers, perhaps, and for discussion and debate at the end of the panel, is at the country level, what are the types of ways in which we can think about, almost a framework for thinking about the COVID-19 labor market transmission mechanism? And there are a few things that are really, really important for me. And I've seen them in different papers, but I think we need a better framework. And perhaps this is a challenge to Sangyeon and Kunal's wider and ILO to start sort of a country research program. The first is, and we know that Oxford data has got this, which is the nature of the country level lockdowns, right? What is the length, the coverage, the sector reach that you're seeing across countries? Linked at the labor market level is very clear estimates of essential workers. Because of course, one of the things that we need to start fine-tuning is who's been affected and who's not. It's what I call sort of, I mean, in a different depth sense, it's treatment and control groups, but the control groups are things we're not affected by lockdown, right? And those are essential workers in the first instance, right? And those workers, healthcare workers, those working in food retail and so on, you need estimates of those, right? The second, and it's a particular issue in developing countries, is estimates of our public sector workers. I haven't seen enough talk of how public sector workers immune from COVID-19. They continue to be employed, they continue to earn the wage, at least in developing countries, I've seen those estimates for. And so the extent to which essential workers, public sector workers are special categories almost of a control group. And then from there, the sort of fourth key element is to provide estimates of those sectors and workers who are forced into and out of employment during the lockdown phases. And my phrase, and my use of words is quite careful, there were phases of lockdowns, at least in South Africa there were, right? So in other words, in the phases, if you had a time-based estimate of months, right, that you calculated, you'd be able to see certain workers coming on stream relative to those who remain out of employment during the lockdown phases. Yes, that we have for South Africa, based purely on pre-lockdown data, of course, right? Is we have, for example, four million workers, that's 25% of all the employed in South Africa will be categorized as essential workers. In addition, using the ONET type classification that we've heard in the previous session, we have about a million workers that are able to work from home. So you have already some estimates and some sense in which you can start thinking about this transmission mechanism from lockdowns to labour market outcomes. I would argue that they, I haven't thought through this clearly enough or carefully enough, there's some sort of duration function analysis that's required as we look over time as workers come on stream into work. And if there's a reversion to higher levels of lockdown where the workers actually then go back out of employment. I also think in thinking through employment outcomes and firm effects, we do need to categorize far more carefully the type of firm effects that we've seen from COVID-19. So they're those firms that have not been affected at all, right, by COVID-19. And those are in financial and business services, private healthcare, food and retail. There are work from home type categorizations, but they're also those that were stipulated by law in the country. And those firms would have been completely immune to COVID-19 effects. But then there are those who've suffered partial disruption because of supply chain problems, or the case may be, and of course those that have closed completely due to bankruptcies. I think there's a rich agenda around firm effects that we need to look at in terms of its impact, the impact of COVID-19 through firm effects. Then in terms of the second question around what are the policy responses we've seen, and just be careful of my time. They sort of, the packages I've seen at least across the developing world have been health support, so water and sanitation, provision of PPEs and so on. But I think it's very important to be seen employment relief, tax relief, and credit guarantee schemes. Very quick impressions about that. In the social assistance scheme for South Africa, which had the largest in the developing world, to the COVID-19 expenditure, close to 63% of the population were reached by some form of new top-up social assistance to individuals, 63% of the population. But what had happened is they moved away, authorities moved away from a pure poverty-targeting mechanism, so move away from social grants to looking at a broader range of workers that were affected by COVID-19, which may not be synonymous with the same group you would target on a sort of pure vulnerability basis. The second impression was on the credit guarantee scheme. It was good in the form of credit support to provide it through banks to small businesses. The problem was that the banks were then reapplying the same criteria for lending to small businesses that they were pre-COVID. So effectively, the banks, whether it was Black-owned businesses, it may have been informal sector businesses, definitely non-traditional businesses for banks, were not supported. So you saw no change, actually, in the typology and the nature of the firm being supported through the credit support to do the security guarantee scheme. That's a huge challenge. Of course, part of it is because banks were not willing to take on more debt and more risk in such a difficult environment. I think there need to be policy fixes there. The third impression is, unfortunately, in South Africa is that health, the health support through government actually brought with it the renewed specter of corruption. So you saw abuses of COVID spending in health in particular from unscrupulous operators. So just very, very quickly, and I'll end here, is that for me, I think one of the challenges thinking out of the box and for this panel to discuss is to what extent can we think of different welfare criteria that policy needs to focus on relative to what has gone before. And perhaps, even in the concept you've seen from the panelists, there is a question for that, right? So Indira, Martha, and Sange and I brought it up that I'll leave you with one thought is that in the context of COVID-19, if you were a grant recipient in South Africa, if the only form of income was a social grant, right? COVID-19 did not change your income status. However, if you were an informal sector worker with no grants coming into your household, COVID-19 moved your income to zero. Standard social assistance packages we have, say in South Africa and in many parts of the developing world would have reached the first group but not the second. And that's the concern we have is about how can we reinvigorate how we think about social assistance packages to be more, it's called it COVID-sensitive. My final comment in relation to that is here's one idea. What about a recovery program or stimulus package funded purely at firms that have actually gone out of business because of COVID-19? And it seems to me that that's a fairly simple targeting mechanism and we haven't, I haven't seen that sort of being put on the table anyway. Thanks, Kanal. Thanks, Haroon. What I'm going to do now is I'm going to ask each of you a question based on what I've heard from others' presentation. Let me start with Indira first. So Indira, one of the things that Sangin said which I think is very important is that we should, as we're thinking about poverty effects in the short and medium run, we should not forget the human capital accumulation story of the long run. In other words, kids are not going to school and poor children are obviously having more difficulty of getting access to the internet and so on. So how do you see that the bank has done so much work on this that how do you see the long run effects of the pandemic on schooling, human capital formation and what can one do to make sure this sorts of effects are not, as Sangin said, are scarring effects because that would be terrible to see. Not only are we having these effects on the working poor right now but we might actually have a situation where these effects will carry on for years to come. So how do you see from the bank's point of view what can be done about this? Thank you very much and thank you to all first to say that I fully agree with your summary of the assessment and Sangin's point on investment in human capital. I think there are two big buckets of losses here. One is that comes from kids and frankly young people and those not being able to attend schools due to closures and I think the second one will be an indirect effect through some of the coping measures. I think there's a little bit of echo from somebody not muted. Anyways, the second one will be I think indirect effects from some of the coping measures that households have been forced to take in terms of nutrition, in terms of depleting assets that inequivocally I think the literature is very clear these things among vulnerable households have intergenerational effects and will affect a human capital labor market later on. So what to do? I think at the bank we are focusing first on learning from the experience of the different processes on how to reopen schools safely balancing the need for education and frankly they also the importance of child care and children being in school for labor force participation of parents with obviously the health risks and I think the experience countries are going at it I live in Vienna in many different ways and there's a richness in the information there that at the bank we're trying to put at the disposal of developing countries. I think the second thing that we are worrying about is that even when schools reopen there are a set of measures and supports that will still be needed for the most vulnerable. I think when we think about children given the circumstances and some of the evidence that we have from previous crisis some children may be required to work at home. It incomes are suffering more hands may be needed in the future. I think we are very concerned about that the longer the closures go on and schools and children are not on schools it's not only that you don't learn in the process but you own learn a significant amount and there's clear evidence of that especially for disadvantaged children and so the challenge will be when we reopen how do we do remedial education given all the other things that education systems need to do and all the challenges. And lastly we support we are supporting countries on getting ready for providing financial support to households to accommodate some of these indirect effects that I mentioned. Sanjuan mentioned our collaboration with the ILO in terms of youth education and TVET. Quite a richness there in terms of how countries are responding and we are aiming to put that information also to the benefit of our client countries. Thank you. Thanks so much Indira. I would ask Sanjuan a question now based on what I heard from Marti. So as Marti said that there is now a kind of a moment where it could be a moment of transformation and how we look at the informal sector or informal sectors. Right. I mean you can go back again once the pandemic is over we go back to everywhere and we forget about them. Or we take this moment and we do something about their rights and so a social contract with informal workers. From your point of view and the ILO's point of view do you see that moment or do you think that's not going to happen? That's a tough question. I think I just want to actually put this question in a context called with very specifically right now. There are many ideas and many policies and about the informal workers. I mean for me as actually Marti actually mentioned we cannot do everything at the moment. And so it's very important in my view to make sure the or the income support I mean from the whatever resources for the government and community whatever this actually supports should actually reach the informal workers at foremost. I mean that's very, very important. How can it make it happen? That is the policy question we have to address at the moment. Now there is a lot of the idea about the cash transfer or the cash actually grants as actually Marti mentioned. There is a bit of the big concern about the delivery mechanism at the moment. In doing so there is some you know the as Haru mentions about the risk of the corruption in some cases discrimination as Marti mentioned there are lots of things happening but we have to really make sure what's the best actually most effective the delivery mechanism without demonizing the informal workers. I mean that's very important. That's what they another one we have to mention is to think about is that the of course this is right issues and etc but another very important dimension is linked to the what just Inza mentioned about the training and opportunity. In my view it's very important it's not too late trying to combine this actually social assistance program especially cash actually transfer or grant program combine that with active labor market policy program particularly training and learning so in return for I mean it's not not a good time but and we are giving and we are providing some income and because of these people normally just stay home without doing much so we can combine that actually probably introducing some training opportunity online or whatever to make sure they actually have some good opportunity to learn to some new knowledge and new skills and etc and get them prepared for the better opportunity once I get the opportunity to run. I think that's a very important aspect of course the real difficulty right now is because of all this actually is given measures and lockdown measures it's very hard to organize the learning the learning at the moment physically but there are so many very innovative ways of doing that using the the communities and all other local authorities and etc there are a lot of good examples why don't we actually take full advantage of that why don't we scale them up actually for the much broader group of the informal workers so I stop there thank you Thank you Thank you Sangan Marty there's a question actually from the audience from Anne Fabry let me ask this question to you so the question is that this is from Anne Fabry the question is that have you seen as you were doing the surveys in several cities in the global south situations were actually because of labor shortages as migrants returned home wages of workers who remained actually increased so in this example that we have flour production in Ethiopia informal casual workers receive higher wages after the crisis because of migrants leaving the city leaving the cities do you have any counterintuitive effects of this kind were actually wages increased because of labor shortages from the work that you've been doing with VEGO that with the migrant workers having returned home in let's say a country like India that the effect that we're seeing now is not that wages have increased but different workers are being hired right so and but the factories and other firms are finding it difficult so both in Surat and Gujarat which is an industrial hub and Tirukur in Tamil Nadu which is an industrial hub the migrants have not returned and so it is other workers who are being hired local but the factories and firms do not have enough orders themselves to be hiring as many workers as they had in the past and the wages I don't think have gone up we didn't we haven't looked at factory workers but that and that is my my general sense the other point about the informal economy is that well over half are self-employed right so that sort of wage effect is only going to apply to you know part of them and it's not the large part most of them are self-employed and there they replant they rely on demand for their goods and services not their labor so it's a it's a very different equation but can I just second Haroon's point about needing labor force surveys one of our big concerns and we've worked with the high hello for you know more than two decades is that fewer and fewer countries are doing labor force surveys and if I may say so with the World Bank partner here that's because the donors tend to favor other surveys and so the living standard measurement survey or some other flavor of the month survey is getting the funding and I do think that labor force surveys are the best source of data on these issues and when we look at data in like in Ghana recently comparing employment figures from labor force survey and from the living standard measurement survey in that country we had to go back to the labor force survey because the living standard measurement survey did not have enough of the indicators to capture not just the size of the informal economy but its composition so I do want to put in a plug for labor force surveys Thanks Mati I have now Haroon a couple of questions for you which one from Eva Maria Edgar my colleague can you any wider versus that it seems that the employment effects of the pandemic is more an urban challenge right because that's where the workers are densely packed cities and so on and given that South Africa is more urbanized than other countries in Southern Africa you see that as a specific problem for South Africa and secondly you also mentioned about corruption and targeting is that something from South Africa's experience using targeting mechanisms that you can one can say about what how effective they can be especially when you have leakages and problems of of imperfect targeting so two questions there one is about specific problems in South Africa because it's more urbanized and secondly what can you say about targeting mechanisms from the South African experience Yeah thanks Kunal I mean those are great questions I think that's precisely the kind of question at least also in terms of urban and rural outcomes that the labor force survey type data will answer right but I think the hunch is correct that you're probably likely to see bigger effects and sort of let's call it job destruction in urban areas relative to rural areas I'm cautious about that because of inter-household transfers right so so you may find as a first order effect that jobs are lost in urban areas obviously because you know as long as you're not in the central worker or public sector worker you are you are in trouble right in terms of the effects of lockdown but that being said you may find that the aggregate poverty effect when one combines household transfers and when one thinks about movement between sharing between urban and rural areas that the overall poverty effect may be to witness in a poverty level in rural areas that are higher than urban areas I have no sense of that and I think that's why there's sort of strong call for regular updated level 4 survey data I know we always talk about data but this seems to be a really important point sort of in terms of massive economic trouble has to be thinking about that type of data and then the second question is an interesting one for South Africa because because of the time I didn't specify this clearly enough a lot of the corruption we've actually seen and let's be clear it wasn't the same as we've had in the last decade under the state capture years but we certainly saw Haroon this is your connection problem it seems Haroon actually warned me there might be internet problem at some point while you were speaking so that happened so let's hope that we can get him back online or whatever so it was the protective personal protective equipment yes I can hear you not am I back okay sorry we just we just had a power failure that I had to sort of reconnect all the Wi-Fi gadgets and so on okay so as I was saying in terms of corruption it's mainly being for personal protective equipment the question about social assistance is interesting in terms of targeting is that it turns out that in the process of widening the social assistance support scheme away from just not just but in addition to our existing social grants to a very progressive child support grant in the old age pension to what is called the COVID-19 grant which was essentially anybody who was unemployed or lost a job because of COVID we early on it shows positive and negative effects so we've seen less support of course to those right at the bottom of the deciles in terms of household income but in fact an increase in the distribution of income reaching those in deciles four, five and six which in a high high quality society like South Africa means that you've actually reached vulnerable households a lot of the informal sector workers domestic workers farm workers are actually in deciles four, five and six so and this is my earlier point of changing or thinking about how things means that are not just purely about let's I've got a question not for all panelists from Ian Walker of the World Bank this is a a big question so the question that Ian asks is that it is clear that existing social protection insurance schemes have done a poor job especially low income countries to protect either jobs or workers in the face of the pandemic so how can we achieve effective universality and what should be a role of fiscal resources versus those of employers obligations such as mandatory severance paid in achieving real universal protection for workers to lose their jobs or incomes this is a big question the role of universal provision to the state versus employers obligations clearly this is probably more relevant in Latin American countries but also relevant also both in in Southern Africa and also in Asia who wants to go first to answer this question Sangen do you want to try and respond yeah thank you yeah that's that's a tough question we have been discussing these issues for almost I don't know how long I mean probably the beginning of the social protection system itself I mean we need to this consider the some of the policy context and also debate here when it comes to how can we strengthen some of the insurance part of social protection for this how we can make sure the strong contribution from workers and the companies that all relates to issue of the of the how to formalize or all the the conventional issue that's important debate but at the same time in this the pandemic there is a a bit of the strong suggestion to somehow delink this actually contribution part of the insurance part of social protection and then basically you know the more pointing to the some idea of of the you know a universal income idea I think these two are now right to mix so that's why the debate at the moment seems to be quite difficult as far as we are concerned actually the the of course all the difficulties of the social protection in the low income countries but somehow in many countries I think the pandemic clearly demonstrate how important social protection system is for people in this kind of situation and so the I think the if we we do much better job actually to strengthen the social protection system I think the there is a huge potentials of the the helping the income support and at the same time potentially also the strength of the world of the automatic stabilizer as well having said this how can we do that obviously I think the we need a much more public resources or the public support to actually scaling up the social protection just relying on the contribution from the companies and workers is good start but when when you go there I think we need a strong support from the the public and the resources and from the society that's obvious I mean but that whole debate about the what is the best way of the what is the strategy financing for the social protection there is a huge debate on that but in my view it's a really good time to discuss the how to strengthen the social protection to respond to all different types of shock including this kind of shock rather than you know the discussing some some of the grand new ideas and then we have some effect of dismantling social protection system and lastly as the delivery mechanism social protection system has a much of the potential or for example for the Malta mentions the all the backdrop of this delivery mechanism is a system when it comes to the cash the grants or cash transfer we know lots of the good examples where they actually using the existing social protection mechanisms to channel in actually a new resources for the cash transfer is the effective and also of course it is not free from the corruption and also the or the inefficiencies by the dead weight will be much lower than the in another situation thank you so so that make my question to India then is India do you see the what was the reason the crisis where one should try and boost universal basic income is this a moment where we actually see this moment to try and bring in universal basic income or do you think that's still premature so I think they I think this is the moment to ask the question of how do we expand not only social assistance as was mentioned but also social insurance which will require a change in the financing as was alluded by Sanjian moving away from this only based in in labor taxation now how do we do it it will be a question of fiscal constraints we have done in a recent publication at the bank actually in two previous publications estimates of how much it would cost to to put in place a UBI and you know in foreign some countries you're talking double double digit percent of of GDP 15 20 percent in some of the low income countries which will not be realistic immediately and in the absence of a tax system that is able to claw back the resources of the top you know the progressivity that you do need for this type of policies to work which would be very difficult to implement that said I think working on the two points of boosting social assistance even gradually as resources become a available and working on mechanisms that provide social insurance which will require also government subsidies for the majority of workers who do not have an employer or where we cannot assess income I think is the is the is the way to go and countries will have different mixes and that's I think okay and we need to learn from that a question from so I'm a bedisha who's based in validation I would ask this question to Mati the bitisha asked that as we know Balinese fits a double shock first shock was of course the spread of COVID in the country itself and the return of migrants and the second shock was a big collapsing demand for garments worldwide and as one knows Balinese major exporters garments so bitisha asked that how does one handle this does one use the foreign exchange reserves that Balinese had to try and cushion the shock for other other mechanisms in this case when a country is going through this double shock one a domestic shock and also another which is a more to do international trade shocks would you what what would you advise here about Mati in this situation well I think am I am I being heard yes thank you for that question I start with the worker and then I work up towards what the government or the employers need to do so for the double shock for the workers we do need as some John has also said that we do need some kind of income support during the crisis what that means for the country to decide on how much to rely on a single sector for export I think is is a big question for Bangladesh it used to be jute and then it was garments and and how much you rely on a single sector is a big question for Bangladesh strategy but for the short term I think there needs to be pressure on the lead firms in these supply chains for the garment industry there has to be pressure on these lead firms we know we're living in an era where the CEO of the lead firm earns thousands times what the workers own there's there's how much profit can we let them absorb without having some responsibility so I think a lot of pressure needs to be put on the lead firms in these supply chains during these shocks to also kick in not just the government to kick in and I think that's a point where we need more emphasis because you know a very large percent of international trade is sort of unregulated and untaxed and there's huge profits being made that could be recycled back into the workers at the lower ends of the chain so I don't think it should just be fall to the states which in turn fall to the taxes of the people I think the the companies need to be held accountable for workers in their chains even if they're not based in that country thank you thank you Martin I'm going to ask Haroon this is the final question did you want to reflect a little bit on the universal basic income issue because I know that's been quite a bit of discussion in South Africa about it what are your views great thanks Kunal and apologies if it comes frankly I've got a bandwidth issues but but in essence my sense would be of course there's been a clarion call for moving come grant or universal income grant for me the lesson seems to me let's not fix what isn't broken and that's in the form of highly effective social assistance packages in Latin America and in South Africa and so on and instead look at support packages that do not get to those workers carry the assistance and today that would be important to talk about as we can shock social assistance packages that are ready to be rolled out for example to mitigate against fiscal pressures when a shock hits like that of COVID-19 I don't think it's not clear to me that we should immediately then roll on to at least a universal income grant for high inequality society like South Africa would have massive leak issues right but if you redirect some of the additional expenditure towards targeted COVID-related let's say pure economic shock related affected workers below some level of vulnerability I think you've you've got something interesting there Yeah our past quarter of the hour so we should now call this ballot to a close I want to thank Indira, Sangyan, Mati and Haroon for this for your very interesting presentations and the way you answered responded to the several questions you got from the audience it was a really it's I think the perhaps the most important thing that we need to understand is that we're still feeling a way and understand the effects of the of the pandemic because as Haroon mentioned we don't really have the data we need and I think that's really important it was good to see this earlier in this in this conference today we had some really nice papers on the pandemic's effects using different methods of course on this and I think we need to have so this is where I feel for this for those who are involved in this conferences which are mostly the labor economists of the world try and do some more work on this perhaps using more the kind of labor for surveys that Haroon mentioned and the kind of work that that Marty and Vigo are doing on the ground work that's very important I think that's essentially for the next few months the second thing we really need to understand exactly are the policy responses I think we still are somewhat in the dark because we got some sense of how some of these policies seem to work but we also know that for for a lot of informal workers this particular this particular kind of programs are not reaching them very well I need to think exactly as Marty said that how can we use this moment as a transformation moment for the world economy because otherwise if we don't learn from this crisis then one has to say that the next time one of the another crisis hits the world as as Sangin mentioned we had a similar not the same kind of crisis but different crisis sometime back the global financial crisis we'll never learn and I think that's important how we can use this moment to learn and to do something that is going to be doing some kind of a significant shift in the way we think about work informal work and and how we deal with low-income workers low in in developing countries so let's hope that can happen and thanks so much for your participation I will because some really excellent questions for the audience and I'm going to call this panel to a close thank you everyone