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Pandemic Devastates the Employment Sector—Both Domestic and Foreign

Covid-19 taught Nepalis a painful lesson that overreliance on foreign jobs is dangerous for the households and national economy, but policy makers have failed to employ returning workers, forcing them to go back again.Nepalis leaving their country in search of work cross the Jamunaha boarder with India past Nepalgunj soon after the major festivals were over this autumn.  Prakash Chandra Timilsena/TKP

Chandan Kumar Mandal
The Kathmandu Post
31 December 2020

When 2020 started, it was expected to be another usual year for the country. None had probably foreseen that the employment sector at home and around the world would be so devastated as it is now.

Tens of thousands of youths enter the labour market every year and nearly an equal number of people of productive age leave the country to toil hard in foreign labour destinations as they are desperate for jobs.

This year, however, has been different for the country and its millions of working people.

The ramifications of the Covid-19 pandemic, which caused a global economic slowdown for the whole year, were felt in the labour market in Nepal and abroad. Rarely in recent history has the job sector experienced such a disastrous impact.

“Despite some ups and downs, there has always been a gradual progress in history, which applies also to the labour market,” said Jeevan Baniya, an expert on labour market and labour migration.

“The labour market, which was already facing a shortage of jobs, saw more job losses. Already scarce jobs and violations of labour rights got exposed. The impact was bigger than that of the 2015 earthquake, when people could still migrate abroad as foreign employment was not closed.”

With the pandemic raging on, its impact on jobs was immediately felt as early as March, even before the country went into several months of lockdown. Businesses started dismissing their employees due to the slowdown caused by the virus.

Covid-19 hit the country’s tourism and aviation sectors the worst, as the government had temporarily stopped issuing on-arrival visas to tourists from all countries and put an end to all spring mountaineering expeditions, including Everest ascents—all to prevent the spread of Covid-19.

The cancellation of visas and mountaineering expeditions during the peak season was expected to put around 20,000 tour, trekking and mountain guides out of work. Hotels and restaurants soon ran empty and occupancy dropped to zero, leading owners to consider staff layoffs.

While formal sector workers faced troubles, informal sector workers, who had to go out to work every day to make ends meet, were hit the hardest.

People eat at a free meal distribution point at Khula Manch, Kathmandu. Thousands of people in Kathmandu were forced to survive on charity after they lost their jobs due to the pandemic.
Anish Regmi/TKP

A study conducted by Whole Industry Trade Unions Nepal among 219 companies in five provinces found that over 70 percent of the employees were left unpaid as a result of complete closure of businesses. Things got worse when the country went into four months of lockdown and prohibitory orders were imposed subsequently in various parts of the country.

A UNDP survey published in May showed that three in five employees lost their jobs due to Covid-19. While workers in the country faced lay-offs, pay cuts, and some even lost their jobs, those who wanted to migrate in search of jobs could not do so, as labour destinations countries such as the Persian Gulf, Malaysia and South Korea, among others, were gripped by the Covid-19 pandemic.

While the job scenario remained gloomy overall, there was at least one sector that hired more people. The e-commerce sector recruited workers in the delivery, logistics and warehouse departments in droves. Entry-level talent got opportunities in online selling firms, as people explored the option of buying things online instead of making a trip to the market amid the coronavirus scare.

Foreign employment has been the country’s biggest source of foreign currency in the last two decades. Labour jobs got out of reach for several months when international flights were suspended in a bid to contain the spread of the virus. In the 2019-20 fiscal year, which remained marred by the pandemic, the number of workers migrating saw a massive drop of 27.5 percent as compared to the previous fiscal (2018-19).

To make things worse for the labour-exporting country, Nepal witnessed a reverse migration trend, having to evacuate tens of thousands of workers who had lost their jobs in foreign cities, putting an extra burden on the limited jobs available in the country.

Migrant workers suffered, as they were stranded for months in foreign lands without income, having to worry for their safety and about basic needs. Tens of thousands of Nepalis returned home even before they could repay their loans or without getting their hard-earned money in the middle of their contract period.

The global economic slowdown also hit the countries employing Nepalis. As they started reserving jobs for their own citizens, hopes for an immediate recovery of the lost jobs is slim to none.

The government has made tall claims to create more than 700,000 jobs this fiscal year. However, its plan and policies have failed to yield expected outcomes and workers continue to migrate to India and other countries even during the pandemic.

“On one hand, the suspension of foreign employment worsened the situation for those who aspired to go abroad for work. On the other, government policies on job creation and retention of the workforce have failed to create visible impacts, as there is no data to convince people,” said Baniya, who is also the assistant director of the Centre for the Study of Labour and Mobility at Social Science Baha.

Even those workers who returned to the country from India and beyond due to Covid fears have started returning to their foreign destinations due to the unavailability of jobs in their country.

“A lack of jobs at home is forcing workers to choose the path of migration once again,” Swarna Kumar Jha, a labour migration expert, told the Post in October. “When they lost their jobs due to the pandemic and returned home, they had hoped to get work under the government’s reintegration programmes. But when they arrived, they didn’t know what to do.”

The Prime Minister Employment Programme, the Oli government’s flagship scheme for creating temporary jobs in the country, which proved to be a let-down since its inception, is once again recording a sluggish progress. Several months into this fiscal year, the PMEP has created opportunities only for a few hundreds across the country when the government is heavily counting on this programme to generate jobs at the local level.

Since labour migration was partially resumed in June, a total 23,065 Nepalis have received permits to work abroad as of mid-November, according to the Department of Foreign Employment. Desperate for jobs, Nepalis have even chosen the difficult route of migrating on visit visa, flouting country’s foreign employment rules, which only makes them more vulnerable to abuses.

When job-seeking Nepalis had finally started migrating to foreign countries, a new variant of coronavirus has led several countries, including the labour destinations, to close their borders. Uncertainty has returned to labour migration once again.

“The general public has not shown interest in government policies either due to a lack of information or due to the complexity of the process. There is a need for a comprehensive and facilitating environment for recovery, backed by leadership. However, with the ongoing political turmoil, which has trickled down to the local level, who will care about creating jobs?” said Baniya.


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