The Developing Freedom Agenda allows us to better understand the pandemic’s impacts on modern slavery.

Vulnerability dimension: The pandemic puts people’s health, livelihoods and income at risk. All of these factors restrict economic agency and make people more vulnerable to modern slavery. The pandemic’s impacts are also regressive: those most marginalized have their risk most greatly increased. Women and girls are at heightened risk, through isolation during lockdown, reduced educational and workforce participation, and reduced food security. Children are more likely to be forced into child labour through impoverishment, parental ill-health or morbidity, and reduced access to education. A 1 per cent rise in poverty leads to a 0.7 per cent increase in child labour rates, pointing to a high risk of reversal of the reductions of child labour achieved in recent decades. Remittances are expected to decline by roughly 20 per cent, removing household income keeping children in school. Reduced incomes can induce child labour migration and child marriage.

Stranded migrant workers are at heightened risk of exploitation as they seek to avoid deportation, compete for jobs, seek to avoid loss of securities or deposits and fight to keep visas and work permits valid. And repatriated migrant workers risk exclusion from social assistance programmes. COVID-19 pushes people into informal work, more insecure and less remunerative than formal work. And the pandemic threatens a microfinance insolvency crisis, removing income support. Reduced access to microcredit will mean worse economic, social and health outcomes for women and girls, reduced household investment in education, reduced education participation rates, and increased child labour.

Exploiter strategies dimension: The pandemic disrupts business models, leading to innovation and adaptation by traffickers and exploiters. In some sectors, the collapse in demand means firms are competing – often on labour costs – for shrinking business, incentivizing coercion. In other sectors, such as PPE, there is a boom in demand on short turnaround that is driving forced work. Sadly, there appears to be a global surge of online child sexual exploitation, representing a tragic inter-net based adaptation in exploiters’ profit-making strategies.

Institutional dimension: Reduced resources disrupt some institutional anti-trafficking responses, such as inspections, and may have other institutional effects that impact vulnerability (such as school closures, or withdrawal of income support and social protection coverage). Some countries have responded to the economic downturn in ways that could further heighten risks, for example reducing worker protections with a view to securing foreign investment and demand.

The pandemic has reduced public revenues and will most likely reduce ODA commitments (the term used to describe both promised and actually disbursed ODA allocations). But it may also have accelerated a turn to environmental, social and governance (ESG) factors in investment and lending decisions. Capital markets are realizing that worker vulnerability can spell vulnerability for both firm performance and economic growth. This offers a significant opportunity for ‘maximizing finance for development’. Multilateral actors already looking to use public spending to crowd-in private capital investment have an opportunity now to do this in a way that helps reduce modern slavery risks and develop freedom.