Majority of Pakistani working people face either pay cuts or layoffs

Coronavirus and economic crisis severely affected the lives of working people

According to a survey conducted jointly by Dun & Bradstreet (D&B) Pakistan and Gallup Pakistan and released under the title ‘Impact of Covid-19 on Consumers in Pakistan, ’ more than half the working-class has either taken a pay cut or lost a job - or both - because of the Covid-19 pandemic.

The survey was conducted between June 04 to June 16 and 1,291 people contacted via telephone. The confidence of many working people about the future of their employment in near future remains low. The survey has expressed the fears of working people for losing their jobs.

 According to survey, 54% respondents have either faced salary cuts or have been laid off by their employers in an attempt to reduce operational expenses. The report said that millions of jobs were lost in Pakistan as businesses were not allowed to operate during the lockdown. Some employees were laid off while others were sent on paid or unpaid leaves; creating panic amongst the working class. Some 18% of the respondents have already lost their jobs due to the pandemic.

Furthermore, it was observed that the impact of job loss was primarily faced by low-income workers. Additionally, 59% of the respondents were concerned about losing their jobs shortly in the wake of Covid-19.

Due to the fear of job loss, consumer expenditures have shifted from non-essential items to essential items, the survey suggested. 33% of the respondents cited an increase in grocery expenditure, 32% recorded an increase in household cleaning items and 32% cited an increase in medical expenditure. Additionally, 39% of the respondents claimed to have reduced expenditure on apparel and footwear. The people are mostly concerned about securing their family’s health, managing their finances and having an impact on savings.

The consumer spending on entertainment and education declined significantly, while consumer spending on medicines and household cleaning items increased. The high-income consumers recorded a sharp decline in expenditure on luxury items.  There is 53% decline in travelling, 51% on apparel and footwear and 49% on outdoor entertainment.

Despite the closure of brick-and-mortar stores, only 15% of consumers have moved to digital payments, as per the survey. Even though the movement of population is restricted due to the outbreak, citizens were reluctant to use digital payment options.
                                                                                 Khalid Bhatti