New Delhi: The COVID-19 pandemic has exacerbated the pre-existing inequities in urban India and has left the “lockdown generation” with lower employment rates, says a London School of Economics report.
According to the report, workers in the bottom half of pre-COVID labour income group suffered bigger income losses than the top half following the coronavirus-induced lockdown.
The report titled, ‘City of dreams no more: The impact of COVID-19 on urban workers in India’, said COVID-19 has decimated livelihoods in urban India and created a new underclass of workers who are being pushed into poverty.
“Informal workers, especially young informal workers from lower socioeconomic groups, faced the biggest job cuts… Among urban workers, the youngest (aged 18 to 25 years) were already much less likely to be in work, more likely to be employed informally and more likely to be paid less,” it pointed out.
The report authored by Shania Bhalotia Swati Dhingra and Fjolla Kondirolli noted that COVID-19 has put India’s urban areas at the “frontlines of the pandemic” and the livelihood crisis arising from it.
“COVID-19 exacerbated pre-existing inequities in urban India and those at the lower end of incomes suffered the most… The pandemic has left the “lockdown generation” with lower employment rates and a legacy of entrenched inequality,” it noted.
The report surveyed 8,500 workers aged 18 to 40 in urban India to understand their experiences at work during COVID-19. The survey was conducted between May and July 2020.
The pandemic has intensified the difficulties and these are expected to get even bigger as the urban demography changes over the next couple of decades, the report said.
The government had imposed lockdown to contain COVID-19 on March 25, 2020 which resulted in the severe disruption of industrial production and consumer spending.
India’s GDP shrank by the steepest ever 23.9 per cent in the April-June period as the coronavirus lockdowns battered an already slowing economy.
The report pointed out that although India runs the world’s largest jobs programme (which guarantees 100 days of work to households), it is limited to rural residents.
Unlike many developed and some developing economies, the report said 52 per cent of urban Indian workers went without work or pay and received no financial assistance to tide over the crisis.
“On average, earnings fell by 48 per cent in April and May, compared to pre-COVID months of January and February. Financial assistance from the government or employers was available to less than a quarter of the workforce,” it said.
The report also emphasised that a national policy commitment is needed to prevent the current earning losses from pushing many of these workers into urban poverty and the threat of long-term unemployment.
