“Informal Economy” is an umbrella concept that includes wage workers (domestic workers, security guards, taxi drivers) and the unemployed (street merchants, trash recycling, educational services, garden mechanics).

For those who didn’t lose their jobs entirely, The data suggests that some informal workers weren’t working in April. Around 31% of those working in casual jobs claimed to have been evicted from their position in comparison to 26% of people in formal work. Women who work in formal and informal work had a higher chance of being denied access than male employees.

Calculations of the authors based on the NIDS-CRAM Wave 1.

Women who work in the informal economy, particularly those who work in self-employment that is not formal, have seen huge reductions in their working hours and earnings.

For the average informal worker, the hours of work reduced from the usual 40-hour week in February to only 20 hours a month in April. In the median, females in informal employment saw a reduction of 49% in hours of work between February and April (from 35 to 18 hours), while males experienced the same decrease of 25% during the same time frame (from forty to thirty hours).

Losses in earnings between February and April for an average self-employed person in informal employment were significant. In the middle of the income distribution, it was 60% less for those who were self-employed in April when compared to February. Women’s average earnings from self-employment that was informal were almost 70 percent less.

Furthermore, the data suggest that the most significant variations in earnings during April and February were found in the most vulnerable workers and those who earned the least. Even prior to the crisis, women working informally had significantly lower earnings than males.

What is the significance of it?

These kinds of losses are reason to be concerned due to the connections to the disappearance of non-formal sources of income and the possibility of a massive increase in extreme poverty as well as food insecurity. About half of workers in informal settings reported that their households had lost their primary source of income since the lockdown started. Nearly half said that their families were short of food during April.

If the study is limited to those who were ‘locked out’ of jobs in April, 60% of the informal workers had a deficit in their income that made them unable to cover their food expenses.

In the same vein as other research that has highlighted the dangers of widespread hunger, This research suggests that as the pandemic spreads across South Africa, current interventions require a significant scale-up and more focus on informal workers generally and women who are casual workers specifically.

Some possible solutions

A variety of support packages that are based on the gendered character of the work has to be put into place immediately. The most important principles should be:

In the first place, any increases to the child support allowance must be based on the child’s age and not per caregiver. This step by itself could result in a third more assistance for the most vulnerable, as well as an additional 2 million individuals above the poverty line for food. The majority of recipients of the child support grant are women, and two-thirds of those working in informal settings live in households that receive one.

The amount of money allotted to social grants must be higher. World Bank analysis of cash transfers that were introduced in more than 200 countries during the pandemic estimates that the amount is approximately 30% of the monthly GDP per person. South Africa’s growth by R250 and R500 ranges between 3.5 percent and 6.9 percent of GDP per person. These figures don’t even cover the cost of a nutritious and basic diet for a child of R638 or even the required R3,413 to support a family. The increase in prices must be extended beyond the current cut-off date of October. Off.