How contagion will affect informal workers

COVID-19 is going to have a devastating impact on economies. Africa has a particular vulnerability because so many people work in the informal sector.

The informal sector thrives in Kenyan rural and urban centres. According to 2015 estimates there were 11.8 million people employed in the informal economy, against 2.4 million working in the formal sector. By 2018 the informal sector accounted for 83.6 percent of total employment.

Worryingly, despite the huge number of people in this labour force, the earnings differentials between the formal and informal sectors are significant. Entry level staff in the formal sector earn between Sh10,000 and sh50,000 a month. Those in the informal sector typically earn a monthly income of between Sh5,000 and Sh25,000.

The informal sector is typically viewed as a stopgap measure where people subsist while they wait for jobs in the formal sector. For these reasons, the sector is neglected by government policies at the local level and by development financiers at the global level.

But, aside from job creation, it’s hugely important to the country’s economy and many households depend on the informal sector. For instance, a lot of vehicle repair and metal work takes place in the informal sector. And the fresh vegetable trade in Kenya is largely informal and unregulated.

Main challenges

Like any other businesses, informal sector business will end up with a reduction in customers because of the pandemic. The government is forced to implement quarantines and stay-at-home orders which will have negative consequences for spending in shopping malls, markets and restaurants.

The businesses that supply the informal sector could, depending how long the measures last, run out of supplies. That will increase the cost of goods. This will affect the cash flow that businesses have.

Travel time to and from work will be affected if public transport is disrupted during the pandemic. This may also mean increased transport costs or delays in getting to work.

Informal workers will also not be able to take many of the precautions that health authorities suggest, such as social distancing, hand washing or self-isolation.

Social distancing between workers in informal markets may be difficult because of crowding. For instance, in markets people work close to each other and don’t have walls separating them. The same can be found in other informal sectors like in public matatu transport, vehicle repair and metal work.

Maintaining hygiene by hand washing with soap and water may also be a problem because there aren’t any facilities. There are not many water points to facilitate handwashing.

Working from home is also difficult. Most informal workers live in informal settlements in single rooms or bedsitters. They do not have enough space to work from. For others, their jobs require them to be on-site, where they’re in contact with their customers. The informal economy operates in agglomerations in different parts of the city.

Can anything be done?

In light of this pandemic, because many informal workers are in contact with large numbers of people, they should be provided with masks to protect themselves and others. Water points should also be set up in markets and other informal sector clusters.

Longer term, the pandemic highlights the need for government and urban planners to plan cities with building designs that cater for traders, artisans and peasants. These facilities should include adequate room size for work, storage and display. There should also be a good supply of clean water, electricity and garbage collection. And there should be facilities that allow traders to access the Internet.