Economists believe that the output across emerging markets contracted for the first time in August since June 2020. The services sector growth dragged, while the manufacturing sector contracted for the first time since May 2020 as a result of the Delta-wave disruptions.
Wonk Monk, an economic policy activist, shared an article on the Covid-19 Delta variant causing the global economic growth to slow down to its lowest levels in August compared to the start of the year, causing emerging markets to dip further. The slowdown is occurring amid a rapid spread of the more infectious Delta variant, which has caused many countries to re-tighten public restrictions and pause business activities.
While some countries such as the UK, India, Brazil, and the Eurozone scaled back its Covid-19 restrictions in August, other like the US, China, and Japan, tightened its measures to curb the spread of the Delta variant. Growth rates were found to be weakest for both the services and manufacturing sectors.
China recorded the slowest growth among all emerging markets in August, with output falling after consistent growth over 15 months. A resurgence of Covid-19 cases to a dramatic contraction of manufacturing and services sectors, leading to an overall drop in business activities since March 2020. Russia’s output also dropped amid rising cases, ending its seven-month growth tenure, while Brazil and India reported considerable expansion in activities after prior downturns caused by the Delta wave.
Global economic growth slows sharply as Delta variant hits businesses, pushing emerging markets into decline https://t.co/2oyPNoITz5
— wonkmonk (@wonkmonk_) September 7, 2021
Christophe Barraud, chief economist and strategist at Market Securities, shared an article on ending Covid-19 unemployment benefits posing new challenges for US recovery. Almost 7.5 million Americans have lost the pandemic jobless benefits amounting to $300 per week payments assistance amid a resurgence of the Delta variant.
Although the end of the jobless benefits marks a key shift in the government’s response to the pandemic, from emergency measures to supporting the labour market, experts believe the change is untimely with fears of an economic downturn if the virus is not curbed.
Those in support of the benefits believe that the withdrawal of the benefits programme could lead to an unequal rebound, a slow recovery, and a sluggish demand for jobs. The US unemployment rate dropped from 6% to 5.2% since March to August. However, the Delta-wave is expected to slow job creations in the leisure and hospitality sectors, the most affected sectors, and is likely to disproportionately impact low-wage workers.
Millions of families, as a result, have now lost out on their income and will be relying on their savings to meet the cuts in jobless benefits. The White House has also urged states to spend another $350bn from the March Covid-19 stimulus to support the unemployed.
🇺🇸 End of Covid-19 unemployment benefits poses test for US recovery – FThttps://t.co/snnyGnlllA
— Christophe Barraud🛢 (@C_Barraud) September 7, 2021
Colin Williams, a professor of public policy at the Sheffield University Management School, the UK, shared an article on Italy’s efforts to regularise the status of undocumented migrant workers, prompted by the pandemic, being a failure. Many European countries assumed that the regularisation would not only protect workers’ rights but also solve the problem of shortage of workers in key industries such as agri-food.
Italy was quick to act on the regularisation, but failed to include many migrants under the scheme during the pandemic. Adopted in May 2020, the scheme included workers in care, agri-food, and domestic work sectors. The aim, however, was to cover all the workers who were doing undeclared work, not just undocumented but documented EU and non-EU migrants, as well as Italians.
As per data, 220,528 workers applied to the scheme by mid-August 2020, less than one-third of the projected 690,000 undocumented migrants who lived in Italy during the pandemic.
Italy’s problem is not labour shortages, but a shortage of workers’ rights #undeclaredwork #informaleconomy #Rights4AllSeasons #EU4FairWork @EU_ELA @ILO_EMP_Policy @informaleconomy @EconomyInformal @Illicit_econ @EFFAT_org @etuc_ces https://t.co/lPpzG959wc
— Colin Williams (@Colin_CWilliams) September 7, 2021