Average loans of the households doubled in the last year; 86% of individuals not earning enough to meet daily necessities

A recent survey found 61.57% people had lost jobs in March and April last year, due to the adverse economic impact of the Covid-19 lockdown, according to a study by the Center for Policy Dialogue (CPD). 

The study also revealed that only 15% could avail a job the following month, while 85% remained unemployed for a longer period.

The results of the study was jointly published by the CPD and Oxfam Bangladesh through a webinar on Wednesday.

CPD Chairman Prof Rehman Sobhan, Distinguished Fellows Prof Debapriya Bhattacharya and Prof Mustafizur Rahman, as well as Tapan Chowdhury, former advisor to the caretaker government and Managing Director of Square Pharmaceuticals, Shahidullah Azim, vice-president of BGMEA, Fahmida Khatun, executive director of CPD, and Dipankar Datta, country director of Oxfam in Bangladesh, spoke at the event.

The paper, titled “Income and Employment in Covid Times: How the People are Coping – Findings from a Household Survey,” was presented by Towfiqul Islam Khan, senior research fellow of CPD.


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The report was conducted in late January and early February this year, among 2,600 households equally selected from rural and urban areas said about 40% of the employed people had their employment situation worsen from the pre-Covid-19 period while only 8% reported better situations.

According to the report, despite the full recovery of jobs before the second wave of the Covid-19 hit this year, average working hours had dropped by 4% causing a decline in wage earnings. 

Additionally, about 45% of households had a lower income compared to the pre-Covid-19 period on average, and average income declined by 12% compared to the pre-covid-19 time for people; while those engaged in agriculture, forestry and fishing faced a loss of 16.50% in contrast to their previous income.

The report further stated that income for people in the manufacturing sector declined by 13%, wholesale, retail trade, motor and vehicle repairing sectors by 14% and about 9% in construction, transportation and storage sectors.

The average loan size of the households doubled in the last year with 86% of individuals not earning enough to meet daily necessities and about 78% resorting to expenditure cut-downs; to cope with the impact.

Meanwhile, 52% of households had changed dietary patterns involuntarily.


Also Read – Covid-19 stimulus: CPD finds banks unwilling to lend to women entrepreneurs


About half of households experienced a decline in savings and more than half of the households had to resort to borrowings, with  only 20% of the households accessing support from the government, the report stated.

Loss of employment and income induced by the pandemic and subsequent adjustments at the individual and household levels are expected to have an impact on the attainment of a number of other goals apart from SDG 8, including elimination of hardcore poverty and reduction of income inequality

In view of the immediate challenges, the CPD recommended designing appropriate policy responses in view of the employment scenario and the labour market, considering immediate, short term and medium term ramifications of the pandemic. 

CPD and other expert panelists also agreed that the proper disbursement of the stimulus package among marginalized communities needs to be ensured by redesigning the stimulus package, in light of the disbursement experience till now.

The organization also highlighted that high cost borrowing will likely put many families into the debt trap hence credit at a subsidized rate is required for farmers and low-income people.

Enhanced cash transfers to the marginalized and affected households to withstand the immediate loss of income and reduced expenditure, as well as boosting the domestic demand through higher consumption expenditure will help create opportunities for employment, advocated CPD.



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