16m become new poor in Bangladesh | The Daily Star
12:00 AM, April 18, 2021 / LAST MODIFIED: 03:14 AM, April 18, 2021

16m become new poor in Bangladesh

SMEs worst victim of job losses due to pandemic

Over 3 percent of the labour force lost jobs while 16.38 million people became new poor amid the pandemic, according to a new study.

The Small and Medium Enterprises (SMEs) and informal sectors saw the highest number of job losses, it said. 

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Between March and September, last year, some 0.4 million migrant workers lost their jobs, added the report titled Recovery of the Labour Market during Covid-19: Role of Trade Union.

Khondaker Golam Moazzem, research director of Centre for Policy Dialogue (CPD), presented the key findings of the study at a virtual dialogue jointly organised by the CPD and Bangladesh Institute of Labour Studies (BILS).

Women-led enterprises were more vulnerable during the crisis and about 50 percent of those enterprises reported laying off 76-100 percent of their workers, it said.

It added that manufacturing, construction, transport, wholesale and retail businesses, food, accommodation services and personal services faced the highest risks while medium-high risk sectors included finance, domestic service, real estate, and education, and low-risk sectors included agriculture, health, information, and communication.

About 69 percent of the employed population in urban areas was in high-risk. The pandemic has opened up business opportunities in a few sectors including e-commerce, health, and pharmaceuticals.

The most affected workers' groups were the labourers in urban areas engaged in construction, informal services, rickshaw pulling, and launch and boat driving.

Self-employed people like street vendors, hawkers, tea sellers, food stall owners and repairmen were also among the worst hit.

The urban informal sector has lost about 1.08 million jobs, which was over 8 percent of total urban employment at the level of 2016-17 fiscal. The workers' wages declined by 42 percent in Dhaka and 33 percent in Chittogram districts. The decline in income of salaried workers was much higher at 49 percent due to a sharp reduction in demand for the services.

The SMEs expected to lose revenue by 66 percent during the pandemic.

The income of all the families, including migrants dropped by 20 percent, and due to the fall in income poverty increased in the country.

The head-count poverty rate has increased from 20 percent in FY 2016-17 to 33 percent in FY 2019-20. If the income of working people in urban and rural areas declined by 80 percent and 20 percent, respectively, the poverty level is likely to increase by 9.1 percent.

Low-income workers' families confronted different types of financial difficulties like the inability to pay rent, unpaid utility bills, unpaid school fees and the inability to send money back to their village homes.

Syed Manzur Elahi, chairman of the Apex Group, suggested an effective tripartite social dialogue for minimising the communication gap among the government, union leaders, and owners.

He said it was not a big deal to arrange transport for the workers who are commuting to factories on foot.

CPD Chairman Rehman Sobhan said workers should be reached by the union leaders at the different factories to check whether the social distancing is properly maintained.

Although the owners committed to providing transport support, there is no indication of how many of them provided the support, he added.

"The workers are now in a much more isolated and vulnerable position as collective action is not there," he said.

He suggested that the union leaders keep in touch with as many workers as possible and monitor the working conditions.

Tuomo Poutiainen, country director of the International Labour Organisation (ILO) in Bangladesh said the union leaders should continue the support to protect the wage.

The fallouts of Covid-19 in the industries are a reminder of the importance of industrial relations, he said.

Naimul Ahsan Jewel, member of the advisory council of BILS, said some two crore people have lost their jobs during the pandemic, but many of them did not get the government's financial support from the stimulus packages.

Many of the workers in the informal sectors that generate 87 percent of the employment did not get the financial aid of the stimulus funds, he said.

Amirul Haque Amin, president of the National Garment Workers Federation demanded payment of salaries and full bonuses to the workers 10 days ahead of Eid.

He said some two lakh garment workers lost their jobs in the first phase of the Covid-19 and so far 1.5 lakh could join work while the rest are still unemployed.

Shirin Akhter, member of the Parliamentary Standing Committee on Ministry of Primary and Mass Education, asked the government to make a database of workers so that they can avail the government benefit in time.

Fahmida Khatun, executive director of the CPD, Nazrul Islam Khan, secretary-general and executive director of the BILS also spoke.

 

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