Coronavirus Fallout

People reel from income losses, rising costs

Moinul Haque | Published: 23:41, Jul 16,2020


The recent increases in living costs have multiplied the miseries of the majority people in Dhaka city as elsewhere across the country with their income shrinking amid the coronavirus pandemic.

Hundreds of thousands of people in the country have undergone drops in income as economic activities slowed down due to coronavirus crisis while the prices of essential commodities, utility bills, transport fares, medicine prices continued to rise with time.

Economists said that not only the poor but the lower-middle-class and middle-class people in the city were also going through the unprecedented pressure from income losses amid the pandemic beginning in March.

The lives and livelihoods of a large majority of the population have become vulnerable and the economy and society would be adversely affected, they said.

Affected people said that they were getting exhausted in their efforts to cope with the rising costs of living as the COVID-19 crisis had eaten up their income in full or in part.

Besides the daily-life regular expenses, sanitiser and personal protective equipment and internet data and smart devices for children’s online education have been added as new areas of expenditure, sufferers said. 

Against the backdrop of the coronavirus outbreak, the point-to-point inflation in April rose to 5.96 per cent from 5.48 per cent in March.

And the food inflation in April sharply increased to 5.91 per cent from 4.87 per cent in March, according to Bangladesh Bureau of Statistics data. 

After a slight fall in May, the point-to-point inflation in June rose again by 0.67 percentage points to 6.02 per cent from 5.35 per cent in May due to the hike in the prices of essential food items, the data showed.

The point-to-point food inflation increased by 1.45 percentage points to 6.54 per cent in June from 5.09 per cent a month ago.

The non-food inflation, however, declined to 5.22 per cent in the month from 5.75 per cent in May.  

‘I lost my job on the last day of April and received only 30 per cent of my salary for the month. I am still jobless and was forced to send my family to the village home last month,’ Khorshed Alam, who was an industrial engineer at Nasa Hi-tech Style Ltd, told New Age.

He said that it was very painful for him that his wife and children were now depending on his father’s income.

‘I am looking for a job but I know that it is a very difficult situation for this purpose as all the companies are squeezing their operations cutting jobs due to the coronavirus crisis,’ Khorshed despaired.

He said that though he lost his job without any notice and received only 30 per cent of his salary in April there was no scope for him to cut the family expenses — rather the costs were increasing amid the pandemic.

According to an analysis of the Centre for Policy Dialogue, Bangladesh’s national poverty rate rose to 35 per cent in 2020 from 24.3 per cent in 2016 due to the adverse impacts of the coronavirus pandemic.

Shahriar Tonik, a textile engineer, said that after losing his job in May he managed to land another job at a garment factory in Savar but his income decreased by nearly 50 per cent.

‘I had to send back my wife to our village home in Chuadanga as it is not possible for me to maintain the family in Dhaka with the decreased income,’ he said.

Shahriar said that not only had his income decreased but the expenses had gone up amid the coronavirus calamity as the prices of daily essentials and the bus fare increased across the country.

Along with the regular expenditures, personal safety materials, including sanitiser and masks, have pushed up his costs, he said.

Bangladesh Institute of Development Studies senior research fellow Nazneen Ahmed told New Age that a large proportion of the population has seen their sources of income perish and most of the jobs would not return.

She said that the pandemic had turned a large number of people into new poor, exposing them to food, accommodation and education vulnerability.

Most of the newly unemployed people who worked in relatively low-paid jobs were suffering from lack of nutrition for a long time, Nazneen said.

‘I don’t see any immediate remedy for the crisis — the government should widen the social safety net,’ she said.

Md Sajib, who lives in the capital’s Mohammadpur area, said, ‘I have been running a small supply business for the last six years but my business has almost come to a halt due to the coronavirus crisis and I am exhausted trying to make ends meet.’

‘Though my income has fallen drastically but I have to pay for food, house rent, utilities and so on as usual,’ he added.

A recent survey, jointly conducted by BRAC, Data Sense and Unnayan Samannay, said that more than 10 crore of the country’s 16 crore citizens were facing high economic and health vulnerability due to the coronavirus pandemic.

It also found that the average family income dropped by as much as 70 per cent for the people surveyed between March and May as an impact of the countrywide economic shutdown.

‘I think Bangladesh has never seen such an economic crisis when the middle and lower-middle income groups have faced such economic challenges,’ South Asian Network on Economic Modelling executive director Selim Raihan said.

Many new poor have adopted coping strategies, at the individual level, by switching occupations, but this would not work without state support to them, he viewed.

A reverse migration process, Selim said, is taking place as many of those who have lost their income in cities are leaving for villages to survive but it would also put pressure on rural employment.

He, too, said that the government should broaden its social safety net and provide capital to the new poor so that they can survive.

‘Otherwise the loss of livelihoods and opportunities might cause social instability,’ he warned.

Shirin Akter, who was a sewing machine operator at Risal Group in Mirpur in the capital and lost her job in April, said that her family had been forced to skip a meal every day.

‘I have worked for five years in the factory but the authorities sacked me in April without paying me any benefits. I have paid my last month’s house rent by selling a showcase and sent back my son, who reads in class two, to village home at Netrakona,’ she said. 

The coronavirus has so far claimed the lives of 2,457 people and infected over 1,93,590 since it was first detected in Bangladesh on March 8.

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