Giving Compass' Take:
- Deepali Khanna et al. highlight how informal workers in Southeast Asia often lack access to public benefits and social security mechanisms, exacerbating the pain of COVID-19 layoffs.
- What steps should governments take to ensure that workers in informal sectors have access to safety nets? Through what pathways could philanthropists provide support and address rising hunger among affected populations?
- Read about how governments and NGOs can support informal workers.
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It is quite evident that the pandemic has exacerbated many existing negative trends. From rising income inequalities to what is now a gaping digital divide, Covid-19 has laid bare pre-existing weaknesses in governance and social protection provision in Southeast Asia, as much as globally. However, one weakness that has received far less attention than it deserves is the disproportionate impact of the pandemic on the livelihoods of millions in informal employment who have become newly unemployed or underemployed.
The pandemic has highlighted the weak foundations of Southeast Asian labor systems. Restrictions on the movement of people and the sudden stoppage or severe downscaling of economic activities to contain the propagation of Covid-19 are having a strong impact on informal workers. The sectors worst affected by the pandemic – such as accommodation and food service activities (including tourism), wholesale and retail trade, transportation, and construction – all have a particularly high proportion of informal labor. According to a 2019 Association of Southeast Asian Nations (ASEAN) Report, the informal employment rate in the accommodation and food services sector ranged from 81 percent to 99 percent in Vietnam, Myanmar, Laos, and Cambodia. In the same four countries, informal employment rates range from 70 percent to 97 percent in wholesale and retail trade, and from 90 percent to 99 percent in construction.
Since the pandemic began, more often than not informal workers have been the first to lose their jobs over those who have the protections offered by formal employment. A survey in Thailand by The Asia Foundation, for example, shows that around two-thirds of those who lost their jobs in small and medium enterprises between May and June 2020 were informally employed, with 81 percent of informal workers who lost their jobs coming from the tourism sector.
Read the full article about unemployment in Southeast Asia by Deepali Khanna, Pitchanuch Supavanich, Nicola Nixon, and Geoffrey Ducanes at The Diplomat.