Early Employment impacts of COVID-19 in Myanmar
ONOW ran digital surveys across the country from April 2 to April 5, 2020, looking for how households and MSMEs are affected by and responding to the rapidly shifting economy
Background
As supplies of inputs to factories have been halted by the near complete closure of Asia regional production facilities, factory closures in Myanmar have forced thousands out of work across the country. This is likely to result in a near-term collapse in supply for everyday household products. This will also likely result in a reduction in buying power for households that are cash strapped.
Following up on our phone-based surveys of our portfolio companies, from April 2 to April 5, ONOW conducted digital surveys in six urban areas in Myanmar with our various consumer-focused digital platforms through ubiquitous Facebook Messenger channels. ONOW sought to understand:
- job loss impacts
- job search status
- the cash management strategies being used to navigate market challenges,
4,318 respondents contributed to the survey, which has been disaggregated by gender, wide age groups (18–35, 35 and above), and location (Yangon, Hlaingthayar, Mandalay, Taunggyi, Monywa, Kalay, Pathein).
- 54% of respondents were female.
- 62% of respondents were between the ages of 18–35.
- 44% of respondents operated an MSME, while 56% of respondents answered on behalf of their households.
The survey is not nationally representative, and survey respondents were conveniently chosen. Survey advertisements were run on social media, inviting Facebook users to click in to view instructions for how to stay safe during the COVID crisis and to contribute information about their present economic situation.
The digital survey was followed by COVID-19 health information from official MoHS sources, and short term coaching guidance for households and MSMEs to navigate cash shortages.
Key Findings
Findings below will reveal that those who own MSMEs have so far fared better in terms of employment resilience than their companion Non-owners. Male non-owners are looking for employment at rates 10% higher than the survey average. Overall, female and male respondents have been affected by work stoppages at roughly the same rates, while a smaller share of women than men are looking for work opportunities.
It is not clear to what extent the economy will return to normal after the COVID-19 threat has passed, but in the meantime many households lack the resilience to avoid falling into a deeper level of poverty as a result of job loss and cash crunches.
Financial institutions should ensure cash is available to MSMEs, government should press development finance institutions to provide cash to those out of work, and policymakers should pass a short term jobs program to employee many 18–35 year olds and develop Myanmar infrastructure.
Employment Status
54% of respondents reported recently ceasing their employment.
When disaggregated by gender in the graphic above, women report being only slightly more affected by job losses than men. As more factory closures continue, we can expect more job losses among women.
Younger age categories report being 4% more affected by job losses, with nearly 56% of 18–35 year olds and nearly 52% of 35 and above reporting a work stoppage.
As can be seen in the graphic above, among those operating their own MSME, only 38% report ceasing their employment.
Employment Searches
In an effort to explore the resilience of MSME owners, the survey asked about current Job Search Activity of respondents. The data below will show that while MSMEs are searching for employment opportunities at unusually high levels, these levels are significantly reduced below those of Non-owners.
The graphic above shows that 68% of respondents overall said that they currently need a job.
Among those who have experienced a work stoppage, 81% say they are searching for work.
MSME v Non-owners
The data reveals increased resilience among MSME owners in the current climate. Though a large share of MSME owners are looking for work, a much larger share of Non-owners are looking for work. 58% of MSME owners are looking for employment opportunities, while 72% of Non-owners are presently looking for work.
Female v Male
When disaggregated by gender, women report searching for work at lower rates than men. 65% of women expressed the need for a job, while 72% of men expressed need for a job.
In the above graphic, we looked at how MSME Owners compared to Non-owners, disaggregated by gender.
The most resilient population is Female MSME Owners, with 54% of this population reporting a need a job.
Within the Male Non-owner population, 76% report needing a job.
Age Effects
The survey also looked at the data from the perspective of wide age brackets. The population that seems most impacted by the current job market is the 18–35 yr old Male Non-owners group, where 78% of respondents reported searching for employment.
These non-owners were hit by work stoppages at a higher than average rates as well, with the 18–35 population stopping work at a rate of nearly 61%, and 35 and above stopping at a rate of nearly 60%, 6% and 5% higher than average respectively.
Myanmar Geographies
It is also useful to look at different geographies across Myanmar to better understand where people have experienced recent work stoppages and current demand for employment.
Mandalay seems to be most affected by work stoppages, where 64% of respondents reported being affected recently. Kalay was least affected, where less than 32% of respondents report being out of work. In Yangon, 53% reported losing a job in relation to the current economic crisis, and 51% in the Hlaingthayar industrial zone reported job losses.
Monywa respondents expressed the highest share of those looking for work, at more than 79%, while Kalay was the lowest at 60%. In Yangon, nearly 68% of respondents expressed a need for a job, and in the Hlaingthayar industrial zone, nearly 66% expressed a need for a job.
Recommendations
Clearly, most people have been affected by the current economic crisis, across most of the country. As the crisis deepens and the effect on the economy lengthens, the resilience that exists in the present economy will be tested. As a result, many households will be forced into a lower economic level.
Financial institutions should ensure that MSMEs continue to have access to cash to operate their businesses, since it seems that those with a business are less exposed to urgent need for employment. However, while more resilience exists in this population, it is still unlikely these MSMEs will survive if a steep reduction in consumer demand continues. Policymakers must aid financial institutions in providing credit.
The government should quickly enact a plan to support those who have recently lost their jobs. The social security fund could be tapped, or appeal should be made to intergovernmental donors to fill the gap in lost income. Otherwise, it is likely that the economic gains of the past seven years could be lost as the most vulnerable regress to previously dire economic states.
Finally, extreme attention and care must be paid to those in the 18–35 age MSME Non-owners population, who may have the least built in economic resilience of all populations. Dissatisfaction and unrest in this group may cause increased societal instability. Efforts should be made to quickly employ these populations in large scale jobs programs.
MSMEs show increased levels of resilience in the current crisis. In a post-crisis economy, it will be important to invest in the continued expansion of entrepreneurship, as it may provide a cushion to those subjected to mass unemployment.
Next Up
ONOW will continue to analyze the available data, and is running weekly surveys with updates to these numbers. The next analysis will look at how these populations are managing their cash during this difficult economy.
Who is ONOW?
ONOW enables female migrants in Myanmar to become empowered entrepreneurs who are financially capable. ONOW’s business incubator helps a woman
- connect to formal financial systems,
- become digitally literate,
- validate her business idea,
- find startup capital, and
- launch the business.
ONOW coaches these businesses for up to two years through individualized coaching and problem solving. Since 2012, ONOW has helped nearly 500 people launch enterprises, and has coached more than 1,500 households. ONOW’s digital platforms have reached more than 200,000 users, and has connected nearly 30,000 to their first formal financial accounts.
ONOW is a member of the Aspen Network of Development Entrepreneurs, and a participant in the Miller Center GSBI Social Entrepreneurship at the Margins.
If your organization would like to use our services for targeted rapid economic surveying throughout Myanmar, please do not hesitate to reach out to ONOW at our website.
