Partial shutdown sinks small businesses, daily wage earners

Thursday, 19 March 2020 01:39 - - {{hitsCtrl.values.hits}}

The partial shutdown of Sri Lanka to fight the spread of COVID-19 by way of special holidays is impacting millions of daily wage earners and thousands of micro and small and medium businesses.

The plight of daily wage earners especially in rural areas was highlighted by Health Minister Pavithra Wanniarachchi during the COVID-2019 Task Force meeting chaired by President Gotabaya Rajapaksa on Tuesday.

With people advised to engage in social distancing, small business owners too have closed down, and for those who are braving the odds, customers are scarce.

There are nearly one million micro businesses employing less than 10 employees. They account for around 44% or 1.4 million of the labour force. These micro businesses are engaged in trading and services. Additionally, there are over 70,000 small businesses which employee between 11-50 people, accounting for half a million or 17% of the labour force.

With dwindling revenue, these micro and small businesses are facing issues of paying salaries for staff, and fear is mounting as the country heads for the Sinhala-Tamil New Year. If the situation aggravates, pay cuts or layoffs are imminent.

Bigger businesses are also impacted, though analysts say they have the financial muscle and reserves to survive the crisis period.

The daily wage earners are also finding it difficult to cope with their livelihood needs. Three-wheel drivers, who number around half a million, too are complaining of dwindling hires, with Government offices and businesses, corporates, and schools shut, and fewer tourists.

At the meeting, the President said that shutdown was not the best option as it impacts the people’s livelihoods and businesses, and panicking or knee-jerk reactions in a crisis does not demonstrate effective leadership.

He said it was important to ensure economic activity and livelihoods are not compromised in the fight against the spread of COVID-19.

During the discussions at the National Task Force meeting, it transpired that a more targeted lockdown of COVID-19 high-risk areas would have been a better response than a partial shutdown across the country.

Since hundreds of un-quarantined recent returnees from Italy, currently the European nation worst-hit by COVID-19, live in the Chilaw/Puttalam area, a local shutdown or Police curfew to have them identified and screened was one of the suggestions.

Such a move would ensure a more targeted mitigation measure, saving scarce medical personnel and gear.

A decision to this effect was announced yesterday, with Police curfew imposed in Puttalam, Chilaw, Negombo and Kochchikade from 4:30 p.m. until 8 a.m. today, to be re-imposed at 2 p.m. until further notice.