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Thursday, June 04, 2020

Explained: Why some workers face higher income loss risk

The study, by researchers from University College London, Bank of Thailand, Universidad Carlos III de Madrid and GRIPS, Tokyo, is published in Covid Economics: Vetted and Real-Time Papers.

By: Express News Service | New Delhi | Updated: May 7, 2020 8:27:56 pm
migrant labour crisis, india lockdown, migrant labour movement, coronavirus, coronavirus news, covid 19 tracker, covid 19 india tracker, indian express A family of migrant workers walk to their village in rural Maharashtra through the Mumbai-Pune road. (Express Photo: Narendra Vaskar/File)

A new study has flagged a disproportionate risk of income loss during the COVID-19 lockdown, suggesting that low-income workers in developing countries face a higher risk as it is less possible to conduct their jobs from home. The study, by researchers from University College London, Bank of Thailand, Universidad Carlos III de Madrid and GRIPS, Tokyo, is published in Covid Economics: Vetted and Real-Time Papers.

It used Thailand as a case study. UCL noted, however, that the findings are relevant for other countries with similar labour market structures — specifically, those with a large share of self-employment and low social safety net.

“A substantially larger percentage of people in lower income groups have manual roles, such as construction (10% in Thailand; 11.5% in EU-27) or machine-based jobs, which means they can’t work remotely and are without any income. Therefore without adequate government intervention to support income or employment for the poor, the adverse impact of COVID-19 could worsen income inequality,” economist Dr Suphanit Piyapromdee of UCL said in a statement.

The researchers found that low-income workers, such as farmers and construction or factory workers, tend to work in jobs that require less physical proximity to other people at work than high income workers, such as office workers or school teachers. However, as low income workers tend to be in occupations that are more machine-dependent and less IT-enabled, this makes them less flexible to work remotely.

The study found 60% of couples from low-income households are in similar occupations (both partners), such as manual labour, compared to 20% of high-income households.

Source: University College London

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