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The Financial Express

Pandemic hitting migrants the hardest

| Updated: November 09, 2020 21:06:27


Pandemic hitting migrants the hardest

Migration plays a vital role in reducing unemployment and poverty in Bangladesh. The remittances sent by the migrants have been growing over time, mainly because of the increasing number of migrants. Data from BMET (Bureau of Manpower, Employment, and Training) show that during 2015-2019, the amount of remittance inflow increased by 20 per cent (in nominal USD) while the number of new migrants departing per year increased by 26 per cent during the same period. With the pace of high economic growth, urbanisation is also increasing. According to a UNDP study, the urbanisation rate in Bangladesh is around 3 per cent, one of the highest in the world. Every year many rural poor people migrate to urban areas. Yet, the poverty rate is significantly lower in urban areas compared to villages (18.9 per cent vs 26.4 per cent in 2016, according to Bangladesh Bureau of Statistics (BBS)), indicating that urbanisation helps reduce poverty. Rural-urban migration also helps people cope with shocks like floods and drought that frequently affect Bangladesh's rural economy.

Many migrants have been, however, severely affected by the Covid-19 pandemic. A survey conducted by the Power and Participation Research Centre (PPRC) and the BRAC Institute of Governance and Development (BIGD) at BRAC University shows that 15.6 per cent of main earners of households from Dhaka slums moved to other districts during April-June while only 1.3 per cent of main earners of households from other districts returned to Dhaka during the same period. These statistics suggest that there has been significant reverse-migration (urban to rural) due to the pandemic. Due to decreased earnings during the lockdown, many slum households perhaps could not cope with the crisis as they usually need to bear fixed costs like house rents and utility bills; hence they migrated back to villages. In the PPRC-BIGD survey, 65 per cent of households who lived in rented houses (mostly in slums) reported that the amount of house rents they paid during the lockdown remained the same as the amount they used to pay earlier, and among those who had no income, the corresponding proportion is 54 per cent. It needs to be mentioned here that according to a study conducted by BIGD in 2017, the average house rent of slum households in Dhaka was about Tk 2,510 per month.

The PPRC-BIGD survey also shows that even one month after withdrawing the country-wide lockdown, 17 per cent of people who became unemployed during the lockdown were unable to return to jobs. Furthermore, as the study reported, earnings of those who had jobs at that time were significantly lower than their pre-COVID earnings. A survey conducted by BBS also shows that the average household income declined by 20 per cent during March-August 2020. This suggests that the effect of the pandemic may last longer, slowing down the recovery of the urban economy. Thus, many of those who have migrated back to rural areas may not re-migrate to urban areas soon.

Evidence also shows that many migrants from abroad returned to the country due to the pandemic. About 95,062 overseas workers mostly lost their jobs due to the pandemic and returned to Bangladesh during April 1 to August 30. Many of these returnees are likely to be unemployed as a study conducted by IOM (International Organisation for Migration) finds that 70 per cent of study migrants who returned from abroad during February-June 2020 were unemployed. There was almost no international migration during the lockdown due to travel restrictions. However, according to Bangladesh Bank, though the amount of remittance inflow declined in April 2020 (USD 1,093 million) compared to January 2020 (USD 1,638 million), it increased significantly in August 2020 (USD 1964 million). But the concern is whether this increase will sustain in the long-run as destination countries' economies have also been affected by the pandemic. According to IMF projection, the GDP of Saudi Arabia and Oman-- destination countries of around 67 per cent of Bangladeshi Migrants as of 2019-- is expected to decline significantly in 2020 (by 5.4 per cent and 10 per cent respectively).

What are the results of reverse migration (urban to rural areas) and fall in international migration? This may lead to a prolonged high unemployment rate in rural areas. Hence, the government supports in the form of grants or loans are essential for them. Access to credits may be effective through increasing self-employment among them, but it needs to be kept in mind that due to lower demand for goods and services as a result of the pandemic, businesses may be less profitable until the economy recovers fully. Thus, it is important that low/no interest is charged on the credits for this group of individuals. These people may have debt from informal sources, which often charge a high rate of interest. Government support will help them overcome the debt burden to some extent. Undertaking policies to bring momentum in the urban economy is also necessary such that those who have migrated back to rural areas can re-migrate to urban areas. During the weekend, flea markets can be operated in some streets (that are relatively less busy) in urban areas. Costs of living in slums where mainly poor migrants live may be decreased by decreasing house rents and utility costs. For this, an appropriate governance mechanism needs to be explored. A decrease in the costs of living in slums will help poor slum households cope with the pandemic. Furthermore, this may also encourage the rural poor to migrate to urban areas, thereby decreasing the rural unemployment rate.

Dr Narayan Das ([email protected]) and Md Shakil Ahmed ([email protected]) are Senior Research Fellow and Senior Research Associate, respectively, at BRAC Institute of Governance and Development, BRAC University

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