(Bloomberg) -- The coronavirus outbreak is having a “deep, far-reaching and unprecedented” impact on employment, with more than 1 billion workers at high risk of a pay cut or losing their job, according to the International Labor Organization.
With factories, schools and shops shuttered around the world, the Geneva-based body says lockdowns are affecting almost 2.7 billion workers. Within that, 1.25 billion are extremely vulnerable, mainly in hotels, food services, manufacturing and retail. That's about 38% of the global workforce.
“These workers are facing a drastic and devastating reduction in working hours, wage cuts and layoffs,” the ILO said Tuesday.
That prediction is the latest in an-ever louder chorus of warnings of the socio-economic damage of measures designed to stop the spread of the virus. Governments are already spending billions to try to cushion the impact on companies and their employees.
“Businesses across a range of economic sectors are facing catastrophic losses, which threaten their operations and solvency,” the ILO said. “Policy responses need to focus on providing immediate relief to workers and enterprises in order to protect livelihoods and economically viable businesses.”
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The organization also estimates that shutdowns mean that working hours will decline by 6.7% this quarter, equivalent to 195 million full-time workers.
The report comes after sharp job losses in countries from the U.K. and Spain to the U.S., where the unemployment rate rose by the most since 1975. It's expected to rise further, because many shop and restaurant closures haven't yet appeared in the statistics.
Such businesses feature on the ILO's list of worst affected sectors.
“Many of those most affected are those who are already low-wage workers and have less access to social protection coverage,” the ILO said. “As such, this can have a further negative impact on already existing inequality.”
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