Labor Market Witnessing Motionless Curve During The Lockdown

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Temporary & Contract Labor segment is severely impacted, as the major companies and factories across Europe and APAC have temporarily shut down their operations. Contract manufacturers are majorly dependent on temporary labor and contract workers to produce mass exhaustible commodities like phones, automobiles, textiles, etc. Key industries affected include General Office & Clerical Duties, FMCG, Food processing, Healthcare, Medical, Manufacturing, and Agriculture.

Migrant Workers are highly affected due to lockdowns in metro cities. However, the impact of the outlook is expected to be short-termed. Numerous out-of-town workers and laborers mainly across APAC, Europe and America are unable to travel back to economic hotspots due to varying degrees of lockdown.

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Freelancers are least impacted among the others in the category, as they are free to work from home and do not have dependency or restrictions from employers regarding work. The impact of the outlook on this category is expected to be short-lived.

Fulltime staff has experienced a moderate impact. The majority of the MNC, software, technology, design and development firms across Europe, MENA and APAC have suggested their permanent staff work from home for a longer period to avoid the spread of infection.

Global impacts of Temporary Labor shortage due to COVID-19

Globally leading metro cities and industrial hubs are facing a shortage of temporary labor, due to lockdowns and panic among the masses, also added up by huge migration of temporary workers to their hometown. In the regional temporary labor market of North America which values ~$160B is, severely impacted due to the spread of the virus, followed by Europe with a total temp labor market worth~$150B and APAC ~$130B. The effects have been notable in LATAM with ~$11B market share and MEA worth ~$10B market due to the decreasing availability of temporary labor. Key industries facing labor shortage globally due to lack of temp labor include General Office & Clerical Duties, Professional-Managerial, Light Industries, IT Staffing, Office and Industrial Support, to list a few.

Key Risk Factors affecting the global labor market

The supply-demand gap of labors has grown. Job vacancies are available, but the labor supply has reduced, leading to high inflation and unemployment rate. Huge disruptions are being observed in labor sourcing and the trend is expected to pertain in the coming quarters. There is an increase in labor cost, due to labor shortages across industries. Companies are focusing on strategic hiring plans and budget forecasts. Labor-intensive industries, such as IT, FMCG, hospitals, hotels & restaurants, manufacturing, are severely affected by the outbreak. This is leading to a labor shortage; however, the effect is expected to stay in further months. Due to the labor shortage, there are higher tendencies of misclassification of workers (temp & full-time), as the existing contract staffs are asked to do overtime and neglect employment contracts, especially for temporary workers. Employers are entering into temporary labor crunch and thus depending on alternate work arrangements to fulfill the tasks tentatively.

Market highlights and Strategies

Currently, the labor market is facing shortages thus making it difficult to source temporary labor. The trend is expected to pertain in the coming quarters as there has been a lot of migration of temporary workers to their home countries/regions due to panic. Labor intensive companies are facing a severe shortage in temp labor availability and hence have come up with an immediate alternative mass hiring process of temp labor. Amazon is hiring 100,000 temporary workers to cope with coronavirus related E-commerce surge. Due to the shortage, there have been cost escalations for the temporary staff. Companies are forced to pay a bump of ~$2 to $5 per hour extra in-order to engage with temp labor in the pandemic period. The trend is expected to continue the coming quarters, and severe impacts are expected on labor- dependent industries. The supply-demand gap in the temporary labor market is expected to widen more in the coming months until the end of the pandemic period, with inflated labor rates in all the major cities across the globe.


Major impacts are observed in the temporary labor and contract staff segment of the global labor market after the outbreak of the COVID-19. The labor market of America and APAC are severely affected by the COVID-19, as it has further widened the demand-supply gap of labor across industries, especially labor-intensive ones. This, in turn, is leading to a noteworthy increase in labor costs and disrupting the global supply chain. Temporary labor, as well as the contract and migrant workers, are the most impacted workforce to be affected by the COVID-19 over the last quarter. Most of these laborers' and worker's earnings are based on hourly or daily wages. There has been a severe loss of employment opportunities in metro cities across the globe due to varying lockdown measures which is leading to a temporary increase in the unemployment rate.

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Labor Market Witnessing Motionless Curve During The Lockdown. (2022, February 17). Edubirdie. Retrieved June 24, 2024, from
“Labor Market Witnessing Motionless Curve During The Lockdown.” Edubirdie, 17 Feb. 2022,
Labor Market Witnessing Motionless Curve During The Lockdown. [online]. Available at: <> [Accessed 24 Jun. 2024].
Labor Market Witnessing Motionless Curve During The Lockdown [Internet]. Edubirdie. 2022 Feb 17 [cited 2024 Jun 24]. Available from:

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