More people falling under the poverty trap is a worrying sign to be addressed

COVID-19 is relegating more people to poverty. The number of new poor in Bangladesh stood at 24.5 million, or 14.7% of the total population, in March due to the fallout of the pandemic. About 59% of new poor are in urban slums and 44% in rural areas. A new study based on a panel survey of over 6,000 rural and urban slum households across the country has come up with these findings. Think tanks PPRC and BIGD jointly conducted the study that revealed livelihoods and emerging vulnerabilities, like mounting debt and dwindling savings. The study in a major finding said that government and non-government actors can exploit to design Covid-19 financial support and programmes for poverty eradication.
PPRC Executive Chairman Dr Hossain Zillur Rahman said urgent initiatives have to be taken for urban poor and “new poor” with effective targeting and leveraging technology. The “new poor” are finding it most difficult to return to pre-Covid occupations and income levels. They are in danger and stuck in a poverty trap. One year into the crisis, 50% of the “new poor” have remained stuck in poverty. It said income drop for the poor and vulnerable was above 70% immediately after the first wave in March-April 2020. Under the first wave the number of poor people doubled and the rate rose from 22% to 42% according to another study.
Agriculture has been critical to economic recovery during the Covid-19 crisis. The persistently high unemployment rate among women, caused by Covid-19, can push many of them out of the labour market – a grave outlook in a country where women’s labour force participation is already low. The employment scenario has improved from June, yet 8% of those who were employed before Covid-19 are currently out of work. The trend is particularly concerning for women – a third of the women employed before Covid-19 has remained unemployed since June.
Besides low income and unemployment, the nature of employment recovery has become a major cause for concern. More than a third of those employed before Covid-19 had to change their occupation. Experts say, a new long-term programme has to be taken up to ensure sustainable livelihood in urban areas and an elaborate plan to tackle future challenges regarding urban poverty. Those steering the wheels of the economy must take serious note of this under current as by now 50% of the population might have fallen below the poverty line. Fiscal measures under the new budget for 2021-22 should from the beginning be geared to bailing out the new poor from the scourge of poverty.