The severe impact of the lockdown on informal workers and its continuing aftermath in Delhi
Millions of workers in the informal economy in Delhi were adversely affected due to COVID-19 pandemic and the national lockdown implemented in a short notice of few hours in March 2020. There were horrific tales of workers losing large percentages of their income, incurring massive debts to meet their basic needs and running the risk of exposure to the deadly virus while trying to earn a living. This article highlights how informal workers, especially women, have been among the worst sufferers of the pandemic facing sudden shrink in livelihoods without any support system and how they are finding it difficult to recover even after the gradual reopening of the economy following the easing of the lockdown. The article suggests some medium and long term measures that can contribute to a more just and equitable post-pandemic situation.
“We weren’t working then (during lockdown) so we used whatever savings we had. But that was only enough to feed ourselves, so we didn’t pay any rent or electricity. Even then, we ran out of food many times, so we had to ask the NGO to help us out with it.”
– Woman waste picker in Delhi
The COVID-19 pandemic and the strict national lockdown, implemented with only four hours’ notice in March 2020, had a severe impact on millions of workers in the informal economy in the Indian capital, New Delhi. The pandemic has revealed the depths of workers’ exclusion in the city. It revealed their dependence on daily earnings to keep the fire burning, and as it unfolded, we heard horrific tales of workers losing large percentages of their income, incurring massive debts to meet their basic needs, and running the risk of exposure to the deadly virus while trying to earn a living. It is not as if COVID-19 created these new fissures, in many ways, it exacerbated the many that already existed.
More than anything else, COVID-19 also clearly revealed how the right to decent work is absolutely central for a life in the city, particularly for the informal workers. These informal workers feed the economic engine of the city and yet remain missing from its imagination.
This article presents the impact of the COVID-19 crisis on informal workers’ livelihoods in Delhi, highlighting how the national lockdown resulted in a sudden, absolute drop in work and income for informal workers. Even after the easing of lockdown and gradual reopening of the economy, recovery for informal workers has been slow and difficult. Accompanying it is the care crisis, where the burden of extra care, especially in an era of depleting incomes and rising vulnerability, fell disproportionately on women, making them the silent victims of both the health and the income crises that accompanied it. This multi-layered nature of the COVID-19 pandemic has had severe and unequal effects, impacting the poor more than the rich and the women more than men.
Impact on work and earnings
Informal employment is defined as any work, which is not covered by legal or social protection. Informal workers therefore have no safety net if they are unable to work and often rely on their daily earnings to support themselves and their households. Of the 461.52 million workers in India, an overwhelming majority of 90 per cent (415.23 million) are informal. In Delhi too, 80 per cent of all workers – a whopping 4.92 million – are informal workers (Raveendran and Vanek 2020). These workers include those who work in or provide services to households (domestic workers, drivers, waste pickers, home-based workers), those who sell goods and services in public spaces (street vendors, rickshaw pullers) and those who have literally helped build the city (construction workers).
With the recognition of the risk posed by the COVID-19 pandemic in March 2020, India went into a harsh lockdown, which eventually lasted over three months. During this time, all economic activity except what was deemed ‘essential’ came to a complete halt. The bustling city of Delhi shut down with closure of industries, markets, offices and public transport. The abrupt cessation of livelihood activity had an immediate damaging impact for the nearly five million informal workers of the city.
A global study by Women in Informal Employment: Globalising and Organising (WIEGO), an international network where the authors of this article work, sought to assess the impact in the peak of lockdown (April) and in the early unlock period (June-July) as compared to the pre-crisis period (February). Delhi was one of the cities where the study was carried out, looking at the impact on the four sectors – home-based workers, domestic workers, street vendors and waste pickers (WIEGO 2020)[i]. The study showed that only 18 per cent of the workers were able to work during lockdown. It needs to be noted that the questionnaire had set a very low bar, asking whether they were able to work for even a single day in April during the peak of lockdown.
Other studies confirmed similar findings. The survey by the National Council of Applied Economic Research (NCAER) in Delhi-NCR only two weeks into lockdown found that 84 per cent of respondents had already experienced income or wage reduction, with around a half saying that this reduction was ‘very much’ (NCAER 2020). The COVID-19 Livelihoods Survey by Azim Premji University also found that 73 per cent of respondents had lost their employment in Delhi (Lahoti, et al. 2020).
The recovery of work even in June when the lockdown restrictions had been eased was far from adequate with only 51 per cent of those surveyed in the WIEGO study being able to work. It was also found that the impact and recovery varied across sectors of informal workers. Only in the waste picking sector, a majority of respondents (78 per cent) were able to resume work in this period. In the street vending and domestic work sectors, only 53 per cent and 42 per cent respectively were able to work even in June.
The sudden loss of work had a devastating impact on the average earnings of informal workers. At least 97 per cent of the workers surveyed reported having less household income in June than before the crisis, with 54 per cent of the workers reporting having no household income at all. What we witness is a drastic drop in earnings in April and only very marginal recovery by June (see Figure 1).
The reason for the economic shock also varied across sectors. For home-based workers, the pandemic and ensuing lockdown have meant a cessation of work orders and a limited access to markets.
Many of the factories from where contractors used to source work were shut, and the middlemen themselves, out of work. Since the pandemic hit, most waste pickers haven’t been able to go out and collect waste. The majority of their earnings come from selling dry waste and recyclables to scrap dealers but due to the ongoing crisis in the country, these junk shops have also shut down. Accompanying this is the fact that rates for waste fell drastically. As the waste pickers were already getting lesser dry waste than before, earnings from it reduced by nearly half. For instance, the price of water bottles that sold for Rs. 32 per kg earlier decreased to a half of it during lockdown.
For domestic workers, restrictions on transport caused a barrier and they were either given partial wages or none, while having to stay at home. Those who continued to work as live-in workers had an increased work burden without any guarantee of an equal increase in wages. For street vendors, the lockdown disrupted networks of distribution. For those who were still able to vend, access to goods and produce was difficult and, on top of that, they were subjected to violent harassment at the hands of the police. A reduced clientele also meant that earnings were very low. Even now, many vendors have yet to find a way to resume work and have used up whatever meagre savings they had.
A gendered impact
There is gender segmentation of the labour market in Delhi, as it is in the rest of the country. Amongst the informal workers in the city, women constitute only a 15 per cent of the total, reflecting the low labour force participation of women. However, amongst all women workers, an overwhelming 76.4 per cent are in informal economy. They are often precariously placed in the least secure and low-earning jobs such as domestic workers and home-based workers with no social protection. In the recent months of the COVID-19 crisis, there has been a sharp decline in women’s work and earnings in Delhi, even as their care burden has increased. Together, these two factors have made the impact of this crisis far more severe on women than their male counterparts, making their exposure, and the subsequent recovery from the economic fallout, harsh and long.
The loss of work and earnings has been particularly acute for certain categories of informal workers, especially sectors dominated by women, such as domestic workers and home-based workers. Domestic workers in Delhi were the worst affected with only 1 per cent being able to work in April. Even post lockdown, only 42 per cent workers were able to work in June. For home-based workers, their ability to work fell even further than during the lockdown period, linked to the continued disruptions in the supply chain, which had depressed the demand for their work. This is pertinent given that these were very low-paying sectors even before the crisis.
Even in sectors such as street vending and waste picking, the recovery has been slower for women, as compared to men. Only 50 per cent of female as opposed to 86 per cent of male waste pickers were able to resume work even after lockdown restrictions eased, and their earnings were also much lower. This is also true for women vendors whose pre- and post-crisis earnings are lower than that of male vendors. Historically, the understanding is that women vendors, even within the larger vendor group, sell perishable goods at precarious locations. It can be assumed that a combination of the fear of harassment and penalisation, and the increased care burden contributed to their inability to resume vending.
Meanwhile, work is only one risk factor; women also shoulder a disproportionate responsibility for household chores and care responsibilities. The WIEGO study shows that in all care responsibility categories, the increases have been disproportionately greater for women (see Figure 2).
In addition, the COVID-19 crisis and associated lockdown have resulted in intense stress for informal worker households. The sudden inability to work and the drastic fall in earnings has had a heavy impact on the ability of informal workers to meet their most basic needs, including the ability to feed themselves and their families. Over a half of waste pickers interviewed faced food insecurity at some point in the month prior to the survey, with 57 per cent reporting experience of hunger among adults in their household. Around 25-30 per cent of workers in the other three sectors also reported having experienced hunger.
In such situations of deprivation, women often revealed their anxiety about the children’s well-being and addressing hunger. One of the workers in Delhi says: “The only thing I want (at this point) is that my children should not go to sleep hungry.”
It reveals the mental trauma that food insecurity imposes on women. Other testimonials of workers reveal the same emotion. Another woman says: “In my family, there are five people including my child. We cannot feed the child like how we feed ourselves; a child cannot survive only with half a litre of milk.”
A woman domestic worker from Delhi recounts how many workers did not have enough food “to feed the entire family, so they would give smaller amounts to each member”.
As the pandemic hit, childcare facilities closed down. Without access to affordable and quality care services, women informal workers had to absorb the costs of care provision by increasing their unpaid care work and reducing the time spent on paid or unpaid work. Earlier studies have highlighted how childcare responsibilities can impact the informal women workers’ income security in multiple ways – they tend to seek work that is more flexible, but more insecure and less well-paid; childcare changes work schedules in a way that negatively impacts on incomes, when women care for children and work simultaneously, they are distracted and productivity decreases, and finally savings are depleted when women cannot work due to childcare responsibilities (Alfers 2016).
The additional responsibility of children’s education now being online has further contributed to the burden of the women. Many poor workers have had to invest in a smartphone, even at times when they had very little or no income. In addition to home schooling, the burden of the care of the sick, disabled and the elderly often falls on women. With children at home, women workers often lament the lack of space, increase in noise and household chores and anxiety regarding the education and well-being of their children. In addition, women’s care duties outside their homes have increased their likelihood of exposure to COVID-19. For instance, women bear the disproportionate burden of carrying water when private water connections are not available, and common toilets are not just hygiene risks for many women but also sites of violence and harassment. A poor habitat with lack of basic water and sanitation services exacerbates their vulnerability to the disease. Increased care burden has an adverse impact on the health of the women, contributing to emotional exhaustion and a surge of mental tension and anxiety. In a situation of decreasing income, outsourcing care needs, such as to private childcare centres or other household help is also taken away from the women. The combined effect of the health, economic and care crisis has resulted in a situation where the women informal workers remain the silent and long-term victims.
Towards building a just and equitable ‘new normal’
Informal workers across sectors recount the lockdown months as the most difficult time that they ever had to face, and cited the inability to work and earn as being the most significant impact that the pandemic had on them. These urban workers operate in a legal and policy environment, which is often hostile or punitive towards informal enterprises, informal activities and faced multiple problems even pre-crisis. With their right to work being taken away, the health crisis of COVID-19 soon turned into an economic and care crisis as well. Women in particular lack economic opportunities where some take up low wage jobs without secure and productive livelihoods. Not only do they face higher risks due to their social disadvantages and poor working conditions, but they also have fewer resources at their disposal to address these risks. Continuing low earnings, increased care burden and little or no access to long-term support mean that the impact of the pandemic on informal workers, especially the women, persists and has long-term implications. The response then must also be long term and reform-oriented, with the aim to build back a better ‘new normal’ that is just and equitable.
As described above, the impact of the COVID-19 crisis has been severe on informal workers, and has affected all aspects of their life, especially for women workers. While some semblance of normalcy has returned in early 2021, the workers are still struggling with very poor recovery in earnings, major indebtedness as well as the burden of care which has not eased. Learning from the lessons that the pandemic revealed, there are several medium to long term measures that can contribute to a more just and equitable post-pandemic situation. Here are some recommendations:
Investing in livelihood recovery: In terms of future recovery, support to resume livelihoods is overwhelmingly the most common need expressed by workers in all sectors. This includes both the necessary permissions to work without harassment, and access to opportunities and capital, which would allow them to do so. For example, for many street vendors, resuming business is still difficult because people fear that the disease will spread more easily at markets. This is an opportunity to advocate for innovative market redesign keeping in mind the needs for safe and socially distant vendor markets. Similarly, home-based workers need targeted livelihood recovery, including the support and promote existing efforts to engage home-based workers in the manufacturing of masks and additional protective equipment that are currently in high demand. Reopening childcare centres and increasing their hours of operation will be a boost to women resuming work.
Recognition and regulation: All workers groups, especially those dominated by women, should be recognised as workers and their work should be brought under the ambit of labour laws and regulations guaranteeing decent wage and working conditions. Informal workers play many roles in keeping the city functioning smoothly and if this pandemic has done anything for them, it is to highlight this aspect of their work. There is a need to continue centre-staging their work in public discourse and to actively discuss ways to support their rehabilitation and recovery. The recent initiative by the central government to accept a letter of recommendation as a proxy for registration for vendors, if implemented successfully, can be a model for proxy documentation recognising informal workers across sectors.
Comprehensive social protection: The crisis has made it clear that gaps in social protection were the biggest barrier to access to relief for informal workers. Most informal workers currently fall outside the cover of labour and social protection laws. Many were unable to access government benefits due to lack of sufficient identification and exclusionary bureaucratic hurdles. Migrant workers did not have documents linking them to the city and were excluded from relief efforts as a result. A digital divide still marks India, despite claims to the contrary, and numerous workers reported that they were unable to register for the e-ration scheme because they did not have access to the Internet.
Ensuring social security for informal workers is the need of the hour. This requires urgent efforts for registration and easing access requirements. The state also needs to invest in our public health system and include informal workers in existing health and insurance schemes, enabling provision of primary healthcare at the neighbourhood and community level. In the current times, this also requires access to quality community testing and quarantine centres that are affordable and in proximity. Additionally, there is a need to alleviate the care responsibilities being disproportionately borne by women workers who are facing a far harsher impact of the crisis on their lives and work. Social protection for them also needs to include services such as full day childcare, which can enable informal workers overburdened with care responsibilities to resume work.
Alfers, Laura. 2016. Our children don't get the attention they deserve: A synthesis of research findings on women informal workers and child care from six membership based organisations. WIEGO.
Lahoti, Rahul, Rosa Abraham, Surbhi Kesar, Paaritosh Nath, and Amit Basole. 2020. Azim Premji University COVID-19 Livelihoods Survey. Available online: https://cse.azimpremjiuniversity.edu.in/wp-content/uploads/2020/06/Comp…, Bengaluru: Azim Premji University.
NCAER, National Data Innovation Centre-. 2020. Delhi NCR Coronavirus Telephone Survey- Round 1 (April 3-6): Preliminary report. Available online http://testnew.ncaer.org/image/userfiles/file/NDIC-TEL/DCVTS%20Results%…, New Delhi: National Council of Applied Economic Research.
Raveendran, Govindan, and Joann Vanek. 2020. Informal Workers in India: A Statistical Profile. WIEGO Statistical Brief No. 24. Available online: https://www.wiego.org/publications/informal-workers-india-statistical-p…, WIEGO.
WIEGO. 2020. COVID-19 Crisis and the Informal Economy: Informal Workers in Delhi, India . Available online: https://www.wiego.org/publications/covid-19-crisis-and-informal-economy…, Women in Informal Emplyment: Globalising and Organising
List of web links:
‘Impact of COVID-19’- Delhi Diary blog by Avi Majithia & Malavika Narayan- https://www.wiego.org/impact-covid-19
‘Govt launches Rs. 5,000-cr special credit facility for street vendors; here's all you need to know about Rs. 10,000 loan scheme’- Firstpost News article. June 1, 2020. Available online: https://www.firstpost.com/business/govt-launches-rs-5000-cr-special-credit-facility-for-street-vendors-heres-all-you-need-to-know-about-rs-10000-loan-scheme-8435181.html
‘Covid-19: How India can ensure that women in the informal sector get the protection they deserve’ by Shalini Sinha. May 12, 2020. The Scroll. Available online: https://scroll.in/article/961181/covid-19-how-india-can-ensure-that-women-in-the-informal-sector-get-the-protection-they-deserve
‘PM SVANidhi: Centre launches 'Letter of Recommendation' module for street vendors’. India TV. August 7, 2020. Available online: https://www.indiatvnews.com/news/india/pm-svanidhi-centre-launches-lett…
‘All you need to know about the One Nation, One Card Scheme’. Deccan Harald. August 2, 2020. Available online: https://www.deccanherald.com/national/all-you-need-to-know-about-the-one-nation-one-card-scheme-868618.html
[i] Unless cited otherwise, the data in this paper has been taken from this report. Available online: https://www.wiego.org/publications/covid-19-crisis-and-informal-economy-informal-workers-delhi-india