Question

Assess labor market prospects for 2020-2021.

Answer 1

Introduction to Labor Market:

Labor market can be defined as a place where employers compete to hire the best workers and the workers compete to get the best satisfying job.A labor market is the functions of economy with demand and supply of labour or worker.Labors can be classified as skilled and unskilled labor,mental and physical labor,productive and unproductive labor.

Employers demand labor because labor is one of the factors of production and without labor(workers) production of goods and services is not possible.Workers use their tools, equipment and skill to turn inputs into final products.

Prospects of labour Market 2020-2021:

The ongoing pandemic COVID-19 has created the worst job crisis for 2020-2021 which resulted in widening inequalities and increase in povert levels through out the world.

1.Decrease in the economic activity due to pandemic:

Inorder to reduce the spread of COVID-19 infection restrictions and measures were taken which resulted in frequent lockdown which inturn resulted in reduction in the economic activity.This has resulted in economic crisis and the financial problems has risen due to unemployment among people around the world.

2.Increase in Unemployment levels during 2020-2021:

The ongoing pandemic has resulted in the decline of economic activity among the countries.International trade among countries has been stopped temporarily which has resulted in reduction in the production levels of goods and services. This has resulted in the increase loss of jobs of many people and unemployment levels has increased.

3.Long term unemployment rises during 2020-2021:

Long-term unemployment was existing even before the pandemic.But due to the ongoing health crisis the demand for labor has been temporarily stopped for the entry level jobs in the labor market . This has led to more and more unemployment for the new people in the labor market.Freshers are finding it very difficult to compete for the entry level jobs.

4.Structural changes boosts up the imbalances in the labor market:

The employers who are planning for cost saving measures has opted for technology based production in place of labour based production which has resulted in losing of jobs by many workers.Thus, giving rise to unemployment.

5.Increase in the Global Unemployment during 2020-2021:

As per the UN's International Labor Organisation reports the global unemployment is prejected to increase by 2.5 million in 2020 and almost half a billion people are working for fewer paid hours as they lack to access to paid work.165 million do not have enough paid work and 120 million have either given up actively search for work or otherwise lack access to labor market.In total more than 470 million people worldwide are affected.

Conclusion:

​​​​​​Many economists are predicting that it may take 2 or 3 years for the economies to fully recover and unemployment dips down to pre COVID-19 levels.Some more experts are of the opinion that recession is coming either in 2020 or 2021.

Therefore the government should take preventive measures wisely to curb the recession levels and bring the financial growth of the economy.