COVID19 induced ‘pink-collar recession’

Global COVID19 cases continue to surge and South Asia becomes the latest hotspot. The economic fallout of the pandemic is also in full swing across economies, and disturbingly aggravating in developing and poor countries. News about companies and businesses axing jobs due to coronavirus and the lockdowns is on the rise.

Ironically, the destruction by Covid-19 pandemic is disproportionately spread. Global facts and figures show that where the fatality rate of the virus is higher in men, its economic consequences are much deeper for woman. While the rising gender disparity should be much worse in developing and poor countries like Pakistan, it remains an oft ignored topic or remains among the ‘soft issues’. However, COVID-19 brutality has forced the some to ponder over what is coming to be known as “pink recession” globally.

Why women are economically battered much more than men? Because women in these country largely work in the informal sector that is hit the hardest by the pandemic. According to World Economic Forum, women and girls stand to lose the most during the coronavirus pandemic. According to a recent research paper by National Bureau of Economic Research, unlike the previous 2008 financial crisis where job losses were much higher for men than women, the current crisis has a big impact on the services sector with high female employment shares. Women employment is concentrated in areas like restaurants, retail, hospitality, tourism, education and health care; and Women-owned businesses tend to be concentrated in similar sectors with lower profit margins compared to men. All these segments have seen the worst in recent history. Another reason for much more pressure on women is that the shutdown of schools and day cares has increased the burden of unpaid work for women.

In addition to increases in unpaid care work, domestic violence and consideration in healthcare system are also real issues that women grapple with in these difficult times. And these factors are likely to have significant negative impact on women employment opportunities going forward. Refreshingly, the chapter on COVID-19 Advent and Impact Assessment in the latest economics survey for 2019-20 talks about women as the most vulnerable group in the socioeconomic impact of coronavirus. From inequality in the labor force, to reproductive health as well as additional burden of domestic work and disease prevention on women, to inequality in educational outcomes, to food security related vulnerabilities particularly in women-led households, it looks like women will be hit the hardest.

Since the impact on the informal and the SME sector seems to be the highest, women businesses and women employees in informal setups in Pakistan is a key ailing segment of the population. Numbers for unemployment and job losses for women during the ongoing pandemic are unknown, which is not a surprise for there exists no database for tracking the overall unemployment from to coronavirus. But some survey and estimates suggest that the situation is not good.

According to Karandaaz’s survey of its 14 women-led investee businesses, there was a 61 percent reduction in their post-COVID-19 revenue forecast for Apr – Jun versus their actual average revenue for Jan-Mar 2020. It further highlights that the businesses expected to lay off 19 percent permanent staff, 53 percent contractual staff, and 33 percent daily wagers in April 2020. Also, 57 percent of the businesses cited salaries as their biggest cost; the remaining 43 percent cited rent as their most major cost.

Another survey conducted by Oraan Tech Private Limited, which is a platform for digitizing ROSCAs (Committees) also show how women are being impacted by COVID-19. The survey was conducted across Karachi, Lahore and Islamabad where 400 women belonging to food, education, fashion beauty, and tech industries were reached for assessing the impact of COVID-19 on their business and/or salaries. the survey highlighted that majority of the women were scared of their current and future financial situation and had no idea how to manage the finances during the ongoing crisis and save their businesses. Over 53 percent of the survey women lost income due to lockdowns and businesses being on hold; 25 percent of the employed faced a cut in salaries belonging; and 17.25 percent respondents lost their jobs to COVID-19 pandemic.

Despite being the marginalized and the vulnerable segment of the population, women are not being equally helped by the government stimuli and relief operations, and that is a fact mirrored globally. Women are generally at a disadvantage in access to finance, information, and representation. Measures like unconditional cash transfers and rescheduling of micro credits specifically for women businesses, measures to alleviate the tax burden on women owned businesses. some quota in the Refinance Scheme to Support Employment and Prevent Layoff of Workers, or ideally a separate scheme for women workers in the informal sector should have been a priority for the government. There should be gender assessment in all country assessments, papers, and policies to understand the impact of COVID-19 on women and how to address it effectively. We cannot afford financial exclusion of women that has painstakingly been achieved too some extent in the last few years. At least not when the country needs more hands on the deck to recover from a pandemic.