Evidence-Based HRResearch & Best Practices

Global Labor Market Report

Some countries are experiencing recovery while others are still fighting to get COVID case rates down.

By Larry Basinait

The COVID-19 pandemic continued to impact the global economy in the second quarter of 2021. While some countries started reopening their economies to begin recovery, many emerging markets saw increases in COVID-19 cases.

Despite this, HRO Today’s Global Labor Market Report found the broader global economy improved within the second quarter. Both the United States and many Asian economies noted an increase in exports or imports as consumption and trade picked up. The global manufacturing PMI (Purchasing Managers’ Index) also increased to an 11 year high in May, supporting the notion that consumers are demanding more goods.

Supply and demand imbalances, however, remained prevalent within the global economy as country re-openings began. Demand for goods and services grew much faster than supply. During the pandemic, many individuals were able to save more money due to lockdowns, had increased income from fiscal measures—or both—and as a result of this, are increasing their spending. Additionally, the supply of workers returning to the labor force and the supply of goods being produced remained below demand.

In the United States, the largest economy in the world, the GDP increased by 6.5% in the second quarter of 2021, fueled by personal consumption as pent-up savings and higher vaccination rates prompted higher spending. The large increase in personal consumption was offset by a decrease in government spending and domestic investment. Even still, consumers remained hesitant to spend money as 56% noted they are focused on using spare money for savings.

In the second quarter of 2021, 24 of the 49 countries analyzed in the report revealed a decrease in their national unemployment rates since the first quarter of 2021. Sixteen reported decreases and the remaining nine were unchanged. Unemployment rate reporting by country differs when it comes to accuracy and timing, particularly during the pandemic. The unemployment rate among Organization for Economic Co-operation and Development (OECD) countries fell by 0.16 percentage points from the first quarter of 2021 to 6.56% in the second quarter of 2021. Each individual U.S. state’s unemployment rate varied greatly throughout the pandemic. New Mexico and Connecticut had the highest unemployment rate at 7.3% in June while Nebraska had the lowest. Overall, 35 states, including Washington D.C., had a decrease in their unemployment rate, 10 states had their unemployment increase, and six reported no change since the first quarter. Additionally, the number of job openings reached a record high as over 10 million jobs were available before June 3.

Also in the second quarter, many emerging market countries like India noted large COVID case spikes. With higher vaccination rates among advanced countries, economic activity recovered swiftly as more people were inclined to get back to normal by traveling and dining at restaurants. Additionally, global consumer confidence rose again, surpassing its pre-pandemic level with highly vaccinated countries noted the largest increase in confidence.

The global biases surrounding vaccine disbursement remained prevalent as most of the vaccines administered were in wealthy countries. In low-income countries, only 0.9% of the population received at least one dose by the end of the quarter. Overall, nearly one quarter (23.4%) of the world received at least one dose of the vaccine and 44 countries have vaccinated at least half of their population. Conversely, 67 countries had less than 10 % of their population vaccinated.

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