Policy brief: COVID-19: Public Employment Services and labour market policy responses

The COVID-19 pandemic has severely disrupted economies and labour markets in all world regions.

Labour market programmes are a key part of the mix of policy responses that governments have put in place to protect jobs, enterprises and incomes from the fallout of the pandemic. As in previous crises, policy-makers in emerging and developed economies have used labour market policies to deal with immediate labour market deterioration in various ways: to speed up return to work, adapt skills, facilitate workforce reallocation and cushion temporary income losses after unemployment spells. However, in contrast with past downturns, in this crisis labour market institutions have had to deal not only with a fall in aggregate demand, but also with the effects of lockdown restrictions and physical distancing measures aimed at slowing the spread of the coronavirus.

International empirical evidence shows that employment services are one of the most cost-effective active labour market interventions aimed at facilitating labour market transitions for workers and enterprises. Since the global economic and financial downturn of 2008–09, Public Employment Services (PES) have become an important point of access for jobseekers, workers and employers to a range of passive and active labour market support mechanisms. In the current crisis, PES operations have been of critical importance in assisting workers and employers dealing with redundancies, furloughs or reduced work schedules.