The cost of the ongoing coronavirus pandemic in terms of human life is mounting by the day, with hundreds of thousands of people getting infected and tens of thousands having already lost their lives. While the medical dimension of the resulting crisis is of immediate concern, its detrimental effects on the household finances of the vulnerable cannot be neglected. In his March 16 national address, PM Imran Khan expressed his worry about the economic consequences for the common man: “If we close down the country, what will happen to the poor? People will die of hunger here.”
According to the Pakistan Bureau of Statistics, one in two (56%) Pakistani labourers is employed in vulnerable jobs. The share of vulnerable workers is the highest in agriculture (88%) but is also significant in sectors such as wholesale and retail trade (70%), real estate (63%), hotels and restaurants (49%) and transport and telecommunication (49%). Workers in the agriculture and construction sectors may escape the worst of the crisis, being less affected by the constraints of social distancing or short-run loss in domestic demand. Salaried employees in both the public and private sectors may also be able to weather the storm thanks to the possibility of work from home and paid leave. The situation of daily-wage and self-employed workers in the cities might be more worrisome. Hawkers lose their business when educational institutions and offices are closed and train services are curtailed, waiters do not get paid when restaurants remain closed, labourers remain without work when export orders are cancelled, and housemaids are turned away to minimise human contact. These workers are the most vulnerable to a major economic shock such as the one arising due to the coronavirus pandemic. The informal, undocumented nature of their work means that these are precisely the workers who can expect the least direct support from the government in times of need. Even a partial closure of the economy can result in this vulnerable section of the population sliding into further depths of poverty.
The government needs to extend its reach to prevent this from happening. While expanding soup kitchens and providing subsidised food and grocery items at the Utility Stores may relieve the immediate pain, the initiative to offer financial assistance to workers under the Ehsaas Programme is most welcome. Moreover, the network and knowledge of the local situation of non-governmental organisations, such as Al Khidmat, Edhi and Akhuwat Foundation, may be useful in this regard. The government also needs to ensure that contractual employees of public institutions get their wages.
The crisis also provides an opportunity to take some long-due steps for structural labour reforms. Just as the government is increasing the coverage of healthcare insurance of low-income households through the Sehat Insaf Card, unemployment insurance for services and trade-sector employees need to be launched. Businesses must be required to register their employees and contribute towards their unemployment insurance.
The economic challenges the country faces cannot be solved by the government alone, and demand action at the community level. Businesses that have temporarily closed their doors can continue paying their employees salaries. Likewise, better-off families can increase their charity givings. The Council of Islamic Ideology (CII) has asked people not to wait for the month of Ramazan, and give their Zakat earlier in view of the present situation.
We are going through a crisis that has not been seen before in contemporary human history, and it’s bound to test the mettle of our nation. The coming days and weeks will require our resolve, patience and spirit of solidarity.
Published in The Express Tribune, March 30th, 2020.
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