Covid-19 crisis triggered school closure in India and has induced learning poverty to such an extent that the country is set to suffer the worst in South Asia in absolute terms both in respect to jobs loss and decline in GDP, which in turn may accelerate each other creating together a vicious circle of shrinkage in both. Jobs for skilled labour in India will decline by 1 percent while it would be 2 percent for unskilled labour on account of this single factor, says a recent ADB Economics Working Pager titled “Potential Economic Impact of Covid-19 related School Closures”. Due to the largest populated country in the region, it would be translated into the greatest number of jobs lost in absolute terms. As for the GDP, India will also suffer the highest decline in South Asia at about USD 98.84 billion in terms of absolute change in 2030. In percentage terms, its GDP will decrease by 0.34 percent in 2023, 1.36 percent in 2026, and 3.19 percent in 2030. Due to the largest size of the economy in the region, it would translate into the worst loss in absolute terms.
However, in percentage terms, the effect will be deepest in Nepal in this region, where GDP is forecast to fall by 0.48 percent in 2023, 1.42 percent in 2025, 4.34 percent in 2028, and 4.97 percent in 2030. The share of unskilled labour employment in Nepal is well above other South Asian economies, so the impact looks more pronounced. Nepal will experience the highest decline in employment among both skilled and unskilled labour in terms of percentage. Employment of skilled labour in Nepal will decline by 1.15 percent in 2025 and by 3.84 percent in 2030, while declines for unskilled labour will be 1 percent in 2025 and 3 percent in 2030. The decline in skilled labour employment in India will be around 0.214 percent next year in 2023 which will increase over three times to 0.731 percent in 2026, and about five times to 1.015 percent in 2030. For unskilled labour, the decline in employment will be 0.243 percent in 2023, which will further deteriorate to a decline of 0.853 percent in 2026 and 2.016 percent in 2030.
The study estimates that earning losses from school closures lead GDP to fall in almost all economies, including the sub-regions of Asia. Globally, the decline amounts to 0.19% of GDP in 2024, 0.64% in 2028, and 1.11% in 2030. In absolute terms, school closures during Covid-19 would cost the global economy USD 943 billion in 2030. Overall, economies with a significant population of school children and college-going youth in rural areas — and in the poorest and second wealth quintile — have been worst-hit as they lack access to stable internet connections needed to study online. Also, if the share of unskilled labour employment in the labour force is high, learning and earning losses are significant. That is because a notable portion of the impacted population will migrate to the unskilled labour force. Against this backdrop, the study has made three policy recommendations about actions to mitigate these impacts while building a more resilient education system. These recommendations are: Support learning recovery; Invest in education and skills; and embrace the digital transformation in education.
