As many as 400 million Indians, including migrant workers and daily wage earners, are at risk of being pushed deeper into poverty because of the covid-19 pandemic, the International Labour Organisation said, terming the crisis as the most severe since the Second World War. The pandemic is likely to impact 2.7 billion workers, or 81% of the world’s workforce, the Geneva-based body said on Wednesday.

The unemployment scenario is unlikely to improve in the second half of 2020, ILO said, adding that it estimates working hours will decline by 6.7% in the second quarter of 2020, which is equivalent to 195 million full-time workers. The forecast indicates that there may be lasting economic damage from the shock caused by the covid-19 pandemic, including widespread joblessness. Loss of wages, in turn, is likely to trigger a slump in demand.

India, which has a relatively high proportion of workers outside the formal workforce, need to be on guard as workers are facing a drastic reduction in working hours, wage cuts and layoffs, the ILO said. “In India, with a share of almost 90% of people working in the informal economy, about 400 million workers in the informal economy are at risk of falling deeper into poverty during the crisis,” ILO said.

“In India, Nigeria and Brazil, the number of workers in the informal economy affected by the lockdown and other containment measures is substantial. Current lockdown measures in India, which are at the high end of the University of Oxford’s covid-19 Government Response Stringency Index, have impacted these workers significantly,” it added.

The ILO warning corroborates local data, which shows that unemployment rate has spiked in India in a span of weeks. The Centre for Monitoring Indian Economy’s weekly tracker survey showed that the unemployment rate shot up from 8.4% in mid-March to 23% in the week ended April 5, reflecting job losses because of the 21-day lockdown that started on March 25. While urban unemployment rate was 30.9%, the rural unemployment rate was over 20%, the data showed.