Impact of CoVID-19 on SMEs and Their Workers: Understanding the Dynamics of Impact and Coping Strategies
It has been almost four months since the first COVID-19 patient was identified in Bangladesh on March 3, 2020. As of June 30, the officially reported number of cases and deaths rose, respectively, to 145,483 and 1,847 (WHO, 2020). The numbers of new cases and deaths are still on rise and there is no sign of slowing down the spread of the diseases. The government shut down all economic activities and traveling from 26th March to May 30, 2020. These measures to contain spread of virus along with fear of pandemic have taken a huge toll on the economy of Bangladesh. The latest forecast of the IMF says that the real GDP growth rate of Bangladesh will drop to 3.8 percent this year, which is 4.4 percentage points lower than the previous year’s rate (IMF, 2020). The World Bank’s forecast suggests even a worse situation-only 1.6 percent growth in real GDP in 2020 (WB, 2020). Given this context, it is essential to understand the extent of immediate, short run and long run impact of COIVD-19 on the businesses to effectively design the bailout packages and the policy supports they need.
Major objective of the study are the following:
1. To generate early evidence on the impact of COVID-19 on the enterprises and the workers and how these impacts vary with size and sectors.
2. To study the short to medium term impact on the enterprises and the workers as it is feared that a large number of SMEs will go out of business and numerous workers will be laid off. So, we will study the extent of such impact.
3. To examine how the SMEs and their workers have been coping with the pandemic.
4. To examine the extent the government’s incentive package has benefitted the SMEs in terms of targeting and use.
Research Team: Kazi Iqbal, Nahid Ferdous Pabon, Tanveer Mahmood