With the global COVID-19 pandemic raging on, unemployment rates are rising in every part of the world. Arab countries, whether oil producers with large sovereign funds or those with other sustainable economic resources, have not been immune from this trend. All of them have been impacted by the negative effects of the pandemic, which has resulted in a dramatic decline in employment across a number of industrial, tourism and other economic sectors. This outcome has boosted jobless numbers with new graduates being deprived of the opportunity to join governmental and private institutions.
Today, many industrialized countries, including the United States, UK and those in the European Union, which were once leading labour markets of the world, are suffering record unemployment rates due to the continuing pandemic. In Britain, unemployment rates reached 4.5 per cent in the third quarter of this year due to layoffs and termination of services, resulting from the closure of businesses in the wake of the second wave of infections, official records show.
Perhaps the only exception is China, which is trying to stay a step ahead of the pandemic and its impacts. It has boosted the production of goods for export to countries that need them to combat the effects of the epidemic Chinese exports recorded an increase of 10 per cent during the past month, while imports grew 13 per cent during the same period, confirming that its economy is heading towards recovery, unlike many industrialised countries whose people are losing their jobs.
Besides causing huge job losses, the outbreak of coronavirus has impacted the work of educational and academic institutions, while imperiling the jobs of those working in these institutions. For several years, industrialised countries competed with each other to attract talent from amongst migrant labour to work in their leading institutions. Germany is one such example of a country that opened its doors to foreign workers, but today suffers 13 per cent unemployment due to COVID-19. It has also reduced working hours in response to the crisis.
These impacts will ultimately lead to a contraction in the economies of these countries, a slowdown in inflation rates and a halt in economic activities. The figures of the European Union, for example, indicate a decline in the economic output of 19 members during the past six months, ranging from 5 to more than 10 per cent. The situation is no different in the United States, where unemployment rose to around 15 per cent due to the pandemic – the worst since the Great Depression of the 1930s.
Generally speaking, the pandemic has upended businesses and shuttered many economic activities, imposed restrictions on the movement of people, and led to a rise in bankruptcies. What we can do in our region is to gradually offer more work opportunities to nationals by replacing foreign labour wherever possible.