COVID-19 (coronavirus), first detected in Wuhan, China, in late December 2019, spread around the world, culminating in a global health emergency. It was quickly followed by a deep economic contraction in virtually every country. The world tumbled into recession, and the overall global gross domestic product (GDP) shrank by 4.3 percent in 2020.

These figures hide immense human suffering. By December 2021, there were 14.9 million excess deaths globally—deaths attributable to the pandemic.1 Poverty increased dramatically. There were 70 million more people living in extreme poverty in 2020 than in 2019—an 11 percent increase. To put things in context, this increase in extreme poverty is roughly four times larger than the spike in poverty during the Asian financial crisis of 1997–98.2 The consequences of the pandemic, however, were not limited to its effects on mortality, economic growth, or poverty. Households were ridden with stress. Mental illness, domestic violence, teen pregnancy, and early marriage spiked in some settings. Millions of children lost a caregiver or were orphaned. Many more missed out on vital nutrition and health care and suffered declines in early childhood development. Nearly 1 billion children missed a year or more of schooling and learned little, if anything, while schools were closed.

Tens of millions of young people were shut out of the job market or entered it with fewer skills and diminished prospects. Taken together, these effects represent a profound loss of human capital. Unless they are reversed, these losses will lead to declines in productivity and earnings as the children and youth of today become the labor force of tomorrow.

The erosion of human capital from the pandemic—and what to do about it—are the subjects of this report.

Although many of the consequences of the pandemic may not fully emerge for years (or even decades),this report presents solid evidence of the impacts of the pandemic to date. It assesses the impact of the pandemic using new individual- and household-level data from low- and middle-income countries and reviews the existing literature. It extracts lessons from actions and policies implemented around the world in response to the pandemic, as well as past evidence on program effectiveness. Moreover, the report recommends concrete policies for the short and medium term that will help recover human capital losses from the pandemic and prepare for future shocks