NO DOUBT, businesses and employees in the non-essential sectors have suffered from significant income losses. But it is in the informal sector that workers have been in especial distress.
Even before Covid-19, daily wage earners and people who were self-employed were already struggling to make ends meet; and since they were heavily dependent on daily wages, the likelihood of their falling into poverty during the pandemic was especially high.1 Adding to this, their working conditions did not provide them with any social protection.
In fact, the International Labour Organization has identified that women and girls involved in the sector as being highly susceptible to shocks.2
In Malaysia most women in the informal sector are own-account workers. They make up 75.2% of overall workers.3 The rest are employees (12.5%) or unpaid family workers (10.9%). Only 1.5% of these women are employers in their own right. In contrast, men in this sector record higher percentages as both employers and employees (2.6% and 25.3% respectively), but significantly lower percentages as own-account workers (65.7%) and unpaid family workers (6.3%).
As it stands, 95.1% of the women in Malaysia’s informal sector work in low- and mid-skilled jobs.4 They are highly concentrated in sales and services (55.0%), and in crafts and related trades (86.4%; among men in the informal sector, 77.5% are in these trades). These women’s jobs are considered labour-intensive and require for them to be present at the workplace; working remotely is neither an option nor a possibility.
In this context, it should be noted that women are disproportionately employed, both formally and informally, in tourism and retail – the two hardest hit sectors.
In a recent survey conducted by the Department of Statistics, 94.8% of self-employed and informal workers experienced reductions in their monthly income.5 Concurrently, it can be assumed that the majority of own-account workers, specifically those in the nonessential sectors and where female informal workers are highly concentrated, were not able to generate any income at all since work was not permitted during the lockdown period.
Women who do odd jobs, e.g. petty traders and helpers for food hawkers are among those most economically vulnerable. Jing* is one of such women; even during normal times, she was only able to work sporadically due to her advanced age and health problems. When Jing did work by helping out at hawker stalls and the kopitiams washing vegetables and dishes, her earnings were meagre and irregular. With the Movement Control Order (MCO) closing most food stalls, it had been impossible for Jing to find even one odd job.
Vamakshi’s* situation is similar to Jing’s. As a single mother with two young sons, Vamakshi takes on odd jobs as a cleaner at shops and houses. Her stream of income is inconsistent, since occasions for her to work are determined by the businesses and home owners that she cleans for. At most, she earns a few hundred Ringgit a month. But during the imposed quarantine, these shops and houses were temporarily shuttered, leaving Vamakshi with little to no financial support to provide for her children.
To Risk Infection or to Starve?
For the majority of daily wage earners with little to no savings, unemployment means no food is put on the table. Left with no other choice, and needing to work or to look for work, some of these informal workers were forced to go against the containment measures.
Both Jing and Vamakshi were unable to attain work and had to rely on aid and handouts, e.g. food packages of oil, rice and other goods distributed by state representatives and NGOs, to survive. Vamakshi discloses that, at times, she and her children had to be satisfied with just rice and soy sauce as a meal.
Single mother Suraida* was one of the luckier ones. Pre-pandemic, she worked as a helper at her aunt’s satay stall for RM30 a day, but this income was reduced to zero during the MCO. Though her situation looked bleak, Suraida and her son were supported by the aunt who provided them with food and a place to stay.
Suraida and her aunt at their satay stall.
Assuredly, financial aid in the form of cash handouts by the federal and state governments provided some relief to some of those in the informal sector. Both Suraida and Jing were recipients of the cash transfer from the federal government. However, Vamakshi was not. In fact, she was not aware of the aid. Her case is not unique though, and there have been many others like her who were uncertain of their eligibility to receive financial assistance.
The Covid-19 pandemic has exposed the insecurities and vulnerabilities of the informal economy. The lifting of the movement restrictions does not mean that life is poised to return to normal for these workers; rather, the adverse effects suffered by businesses and the general economy are passed onto them. Jing is currently relying on loans from relatives and friends, while Vamakshi is patiently waiting for businesses to reopen so that by some stroke of luck, she is able to find employment again. Suraida, on the other hand, is back at work and once again earning her daily wage.
Further protection is needed for these informal workers, most of whom are women. A review of the existing social protection schemes to widen them to include the informal sector is in order.
* Names have been changed to protect the privacy of the individuals.
The author wishes to thank Ms Ong Bee Leng, CEO of Penang Women’s Development Corporation, for her invaluable help and contribution towards the writing of this article.
1 International Labour Organization. (May 2020). COVID-19 crisis and the informal economy Immediate responses and policy challenges, retrieved from https://www.ilo.org/wcmsp5/groups/public/---ed_ protect/---protrav/---travail/documents/briefingnote/w cms_743623. pdf
3 Department of Statistics Malaysia. (2018). Informal Sector Workforce Survey Report, 2017.
5 Department of Statistics Malaysia. (2020). Report of Special Survey on Effects of Covid-19 on Economy & Individual - Round 1.
Yeong Pey Jung is a senior analyst with the Socio-economics and Statistics Programme at Penang Institute. She is a reading enthusiast and is surgically attached to her Kindle.