June 23, 2020

Worker Protection: Reopening the World’s Economies in the Presence of COVID-19

Led by Georgetown University, the Global Economic Challenges (GEC) Network brings together prominent research and policy institutions to address the most critical economic challenges of the twenty-first century. The latest workshop sponsored by GEC, Université Libre de Bruxelles (Solvay), and the Center for Economic Policy Research (CEPR) discussed the need for worker protection when reopening the world’s economy amid the global COVID-19 pandemic.

Video call on a computer
Video call on a computer

Unlocking the Economy

“When we launched [the Global Economic Challenges Network] in November 2019, at that time we did not expect that in less than 6 months we would be living in a global economic shutdown," Shéhérazade Semsar-de Boisséson, CEO of Politico Europe and advisory board member for Georgetown’s Master of Science in Foreign Service, remarked. Semsar-de Boisséson opened the workshop  which brought together immunologists, economists, and individuals from the public and private sectors to understandhow and when we can push the button on” the economy.

The Medical Challenges

Michel Goldman, a medical doctor specializing in immunology and internal medicine and founder of the Institute for Interdisciplinary Innovation in healthcare (I3h) at the Université Libre de Bruxelles, outlined the need to analyze the unique nature of the COVID-19 virus. Goldman emphasized the differences between the symptoms and consequences of COVID-19 and the flu: “COVID-19 has a 20 times higher fatality rate than the flu.”

In order to protect workers, Goldman insisted that any steps governments take to reopen their economies must involve a comprehensive understanding of the medical risks associated with the COVID-19 virus. 

A science-based reopening of the economy will require new government capacities. In particular, governments must develop a capacity to apply differentiated, targeted, strategies that treat people differently depending on their risk profile.

Luigi Guiso, Axa Professor of Economics at the Einaudi Institute for Economics and Finance, emphasized that the significant medical risks associated with COVID-19 mean there “is very little room for disagreement, for political controversy.” 

According to Guiso, “Industries that have a higher economic value and at the same time workers, technologically speaking, are characterized by higher social physical distance" are the sectors that should reopen first. Industries with higher economic value would be those indispensable for production and needed due to export dependence. They would also be able to implement production according to social distancing guidelines or work from home strategies. 

Panelists discuss worker protection via Zoom
Panelists discuss worker protection via Zoom

Protecting Individual Workers

Giuseppe Moscarini, a professor of economics at Yale University and co-director of the Research Program in Macroeconomics at the Cowles Foundation for Research in Economics, noted the need for governments worldwide to focus on providing protections for individual employees in all sectors. 

“The question is what should the labour market do?” Moscarini expressed. “One: protect the employment from this temporary shock. Two: reallocate employment to activities with stronger needs.” 

Protecting employment means preventing wage losses for individual workers and society from losing experts in important fields. Reallocating jobs to industries that need them, like retail and heath care, will ensure that vital resources are available to all constituents and consumers.

Mathias Vicherat, the general secretary of Danone, described how his company has taken great measures to secure safety for their 100,000 employees in over 100 countries around the world, as well as investing €350 million to support its suppliers and customers.

We protect our workers with sanitary measures but also from a social standpoint. We have guaranteed wages, 100% of all wages around the world.” 

Danone has used the COVID-19 pandemic as a starting point for redefining its mission to more clearly incorporate social and environmental elements. Vicherat concluded that others must follow suit.

This crisis is obviously a tragedy, but could also be an opportunity to reboot the economic system.