COVID-19 induced economic loss and ensuring food security for vulnerable groups: Policy implications from Bangladesh

Abstract

At present nearly half of the world's population is under some form of government restriction to curb the spread of COVID-19, an extremely contagious disease. In Bangladesh, in the wake of five deaths and 48 infections from COVID-19, between March 24 and May 30, 2020, the government imposed a nationwide lockdown. While this lockdown restricted the spread of COVID-19, in the absence of effective support, it can generate severe food and nutrition insecurity for daily wage-based workers. Of the 61 million employed labor force in Bangladesh, nearly 35% of them are paid on a daily basis. This study examines the food security and welfare impacts of the COVID-19 induced lockdown on daily wage workers both in the farm and nonfarm sectors in Bangladesh. Using information from more than 50,000 respondents complied with the 2016-17 Household Income and Expenditure Survey (HIES) in Bangladesh, this study estimates daily wage rates as Bangladesh Taka (BDT) 272.2 in the farm sector and BDT 361.5 in the nonfarm sector. Using the estimated daily wage earnings, this study estimates that a one-day complete lockdown generates a US$64.2 million equivalent economic loss only considering the wage loss of the daily wage workers. After estimating the daily per capita food expenditure separately for farm and nonfarm households, this study estimates a minimum compensation package for the daily wage-based farm and nonfarm households around the US $ 1 per day per household to ensure minimum food security for the daily wage-based worker households.

Fig 1. Lockdown status of the districts in Bangladesh and the share of the daily wage-based workers by districts.

Sources: Authors’ based on The Business Standard; HIES 2016–17 data of BBS.