Unemployment Spirals Due To Covid-19 Outbreak

Source: Vientiane Times

There is encouraging news as the number of new cases of Covid-19 reported in some provinces is trending downwards, but the perennial challenge of unemployment in Laos has been further exacerbated by the pandemic.

The unemployment rate has increased sharply since the end of 2020 amid measures imposed to prevent the spread of the virus.

The unemployment rate has surged from the normal average of 2 percent to 23 percent in 2020 and up to be 25 percent at present. The unemployment rate measures the number of people actively looking for a job, according to the Ministry of Labour and Social Welfare.

Many businesses ceased operation during last year’s lockdown and some are still shuttered as a result of lost business.

These include processing and garment factories, construction material manufacturers, restaurants, shops, and businesses operating within and outside of special and specific economic zones.

Minister of Labour and Social Welfare, Mrs Baykham Khattiya, summed up the situation recently when speaking to managers at garment factories in Vientiane to mark International Labour Day (May 1) and World Day against Child Labour (June 12).

She said the Covid-19 outbreak has had a direct impact on workers in Laos and Lao nationals working in other countries.

“We urge all factories in Laos not to lay people off from their jobs because this poses a risk to the local economy,” she said.

It is estimated that almost 63,000 people are unemployed as a result of the Covid-19 pandemic, include workers returning from jobs in countries that closed factories and businesses, according to the International Organisation for Migration.

Some 62,999 people, including 32,000 women, are currently unemployed, of whom 5,832 are normally resident in Laos, 50,389 who have returned from other countries, and 7,778 who are undocumented,

Mrs Baykham said that although the risk of a widespread and severe outbreak still exists. Against this backdrop, the government has laid out measures to prevent the spread of the virus

In addition to virus prevention and control measures, the government has introduced short- and long-term policies aimed at minimising the damage caused to the economy.

Last year the Ministry of Social Welfare provided unemployment benefits for 326 people and labour units affected by the pandemic. In total there were 20,659 beneficiaries who between them received over 18 billion kip.

This is intended to help businesses, especially small and medium enterprises, to continue their operations and drive the economy forward.