Mapping Global Income Support During COVID-19
Mapping Global Income Support During COVID-19
BY TYLER
DURDEN FRIDAY, FEB 05, 2021 - 1:00
Income loss has impacted many during the COVID-19 pandemic. As Visual Capitalist's Avery Koop details below, unemployment, reduced hours, office closures, and business shutdowns have prompted the need for mass income support.
Globally, income from
work fell $3.5 trillion in the first nine months of 2020, a
change of -10.7% compared to the same period in
2019.
In the map
below, Our World in Data reveals the different
levels of income support provided by governments across the globe.
Income support, in
this case, is defined as governments broadly covering lost salaries, or
providing universal basic income or direct payments to people who have lost
their jobs or cannot work. Levels of income support are changing over time.
Small Government
Many world governments
have provided no support when it comes to a universally
applicable scheme to cover lost income in their countries.
Examples: (as of January 25th, 2021)
- Venezuela
- Syria
- Belarus
- Bangladesh
- Cambodia
The majority of the
governments providing no support are in low to lower-middle income countries.
Based on a recent report from the International
Labour Organization (ILO), lower-middle income countries have also seen the
highest income losses, reaching 15.1% since 2019.
Developing countries
tend to experience a significant fiscal stimulus gap, in which they do not have
the capacity to cushion lost income or lost jobs. In fact, it’s estimated by
the ILO that low and lower-middle income countries would need to inject an
additional $982 billion into their economies to reach the same
level of fiscal stimulus as high income countries.
A Helping Hand
There are other
governments that are giving out some help on a wide-scale basis, providing citizens less
than 50% of their lost salaries:
Examples: (as of January 25th, 2021)
- South
Africa
- China
- Russia
- Thailand
- Australia
South Africa’s unemployment rate was the highest in the
world at 37.0% in 2020, an increase from 28.7% in 2019.
Despite having one of the strictest lockdowns, the country has not been able to
slow rising case counts or job losses. Now, South Africa is facing another
threat, as a new strain of the novel coronavirus has taken hold in the nation.
The Most Supportive Governments
Finally, many world
governments have offered higher amounts of income support, providing citizens
with more than 50% of lost income:
Examples: (as of January 25th, 2021)
- Canada
- United
States
- United
Kingdom
- Spain
- Saudi
Arabia
Regionally, it’s the
Americas that have been hit the hardest, according to the ILO. The region
experienced a 12.1% drop in labor income in 2020 compared to
2019, revealing the need for broad-based income support.
U.S. unemployment went
from 3.7% to 8.9% between 2019 and 2020. While the American government
initially provided support in the form of the CARES Act, the policy response was recently
extended through the more recent $900 billion relief deal.
Income Support Post COVID-19
While some countries
have not been in extreme need of income support, others have been and haven’t
received it. When looking at demographics, the hardest hit workers have
been temporary workers, migrant workers, care workers, and self-employed
vendors who have no labor contracts or employment insurance.
As a result, some
critics have used this as an opportunity to call for universal basic income (UBI). A
three-year study is already being implemented in Germany, for example, to test
out how effective this kind of income support would be in the post-pandemic
period.
Today, however, income is not a guarantee, and while in 2021 things may be returning to ‘normal,’ that does not mean that income levels will go back to normal.
https://www.zerohedge.com/economics/mapping-global-income-support-during-covid-19
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