Zimstat survey reveals Covid-19 impact on incomes, remittances

The Covid-19 pandemic that saw the country going under lockdown for the better part of the four months to July 2020 resulted in at least 90 percent of households that operated non-farm businesses reporting a drop in revenue, official statistics show.

Remittances from abroad also declined during the same period.

Results of a survey conducted by the Zimbabwe National Statistics Agency (Zimstat), to see the impact of Covid-19 on households, revealed that there was a considerable fall in household income since the onset of the pandemic up to the 24th July 2020.

Through a telephone interview that lasted 25 minutes on average, the respondents revealed that the coronavirus had had a considerable impact on employment.

Roughly 64 percent of respondents reported having a job before the imposition of mobility restrictions and this was reduced to 51 percent in July 2020.

Urban areas were most affected by job losses as 18 percent of respondents were working before Covid-19 but were no longer working in July 2020.

“The most commonly cited reason for no longer working was business closure due to Covid19 lockdown restrictions,” reads part of the Survey Report.

What was, however, more telling was the loss of income with 90 percent of households who operated a non-farm business reporting a drop in revenue, while 44 percent of wage workers reported a reduction or disappearance of wages.

The drop in household incomes was more common in urban areas as the proportion of people working for a wage was higher in urban areas than in rural areas (58 percent vs 38 percent).

Rural areas were however little affected in terms of income generation with at least 86 percent of the farmers who responded saying they were able to conduct their normal farming activities as usual.

Farming was the main activity for 77 percent of the rural respondents.

While the Reserve Bank of Zimbabwe has reported a 45 percent increase in remittances, the respondents to the survey indicated that remittances from abroad fell during the period under review.

Two thirds of households for whom remittances are an income source indicated that it had dropped and according to Zimstat, these income losses are likely to exacerbate extreme poverty which stood at 38 percent in April-May 2019.

The mismatch between what is being reported by the central bank and what was revealed by the survey could be that while there has been an increase in remittance through formal channels due to cross border restrictions, overall there has been a decline.

The survey also revealed that income in the form of assistance from family members also fell.

“Assistance from family members constituted 18 percent of household’s income source on average and 75 percent of these households indicated that it had decreased since the start of the COVID-19 restrictions,” reads part of the survey.

The survey also revealed the extent of food insecurity in the country in particular during the period under review.

There was a concerning impact on household food security, with half of urban respondents and two thirds of rural respondents reporting skipping meals or running out of food.

Moreover, one third of the extremely poor could not afford to buy maize meal.

Rural areas were most affected with more than one-third of survey respondents in rural areas reporting that in the 30 days before the July 2020 interview they had gone without a meal for a full day, at least once.

This proportion was one-sixth among urban respondents.

“More than half of urban households and two thirds of rural respondents had to skip meals because of lack of resources to obtain food,” reads part of the report.

Four out of five rural respondents indicated they were unable to eat healthy or nutritious meals or their preferred food at least once during the 30 days before the interview.

Although the urban proportion that gave this answer was slightly lower (71 percent), between April-May 2019 and July 2020 it increased proportionally more than in rural areas.

According to Zimstat, the fact that the food security situation was reported for July 2020 just after completion of the harvest, means that this trend is likely to worsen in subsequent months of 2020.

Zimstat plans to repeat the interviews every 4-6 weeks.-ebusinessweekly