Population below poverty line doubled: Survey

The South Asian Network on Economic Modeling (SANEM) on Saturday said the percentage of the population living below the poverty line (upper poverty line) has nearly doubled from 21.6% in 2018 to 42% in 2020, while the percentage of extreme poor (lower poverty line) trebled from 9.4% in 2018 to 28.5% in 2020.

Executive Director of SANEM Dr Selim Raihan disclosed the survey results at the 10th episode of SANEM Shongzog on “COVID-19 Fallout on Poverty and Livelihoods in Bangladesh: Results from SANEM’s Nationwide Survey (Nov-Dec 2020).”

The poverty rate has increased in both urban and rural areas in Bangladesh. The  percentage of the population below the poverty line in rural areas was 45.3%,  while the number was 35.4% in urban areas.

The percentage of extreme poor in rural areas was 33.2%, while in urban areas it was 19%.

“We conducted the nationwide household survey from 2 November to 17 December 2020 to unravel the COVID-19 pandemic’s impact on three broad indicators, namely Poverty, Inequality, and Employment (PIE),” the Professor of Economics Department at Dhaka University also said.

Compared to 2018, the average per capita household expenditure in 2020 has decreased by 45%, 29% and 17% in extreme poor (people below LPL, or lower poverty line), moderate poor (people in between the LPL and UPL, or upper poverty line) and vulnerably poor (people between UPL and 1.25 times UPL) households, respectively. At the same time, it has increased by 6% in non-poor and non-vulnerable households.

For this analysis, households have been classified as “old-poor” and “new-poor” depending on whether they were already poor prior to the pandemic or whether they have fallen below the poverty line as a result of the pandemic.

In households classified as poor prior to the pandemic, 37% of household heads are self-employed, 20.5% are wage-employed, and 39.5% are day labourers.

On the other hand, in households that have fallen into poverty as a result of the pandemic, 42.3% household heads are self-employed, 23.9% are wage-employed, and 30.2% are day labourers. Among households classified as “old-poor”, 43.4% rely on agriculture, 5.2% on the industry, 46.5% on service, 0.3% on government allowances, and 3% on remittance source of income.

Besides, among new-poor households, 36.6% rely on agriculture, 6.4% on the industry, 51.2% on service, 0.4% on government allowances and 3.2% on remittances as their primary source of income.

To understand the impact on inequality, the study team constructed consumption expenditure Gini and some other measures of inequality. The Gini coefficient has increased from 0.32 in 2016 to 0.31 in 2018 and 0.33 in 2020.