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Jakarta Post

Informal workers most vulnerable during pandemic

Physical distancing, closed shops and empty roads have changed the daily activities of Tedy Abdullah, a 27-year-old motorcycle taxi driver who partners with ride-hailing apps Gojek and Grab

Farida Susanty (The Jakarta Post)
Jakarta
Sat, April 4, 2020

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Informal workers most vulnerable during pandemic

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hysical distancing, closed shops and empty roads have changed the daily activities of Tedy Abdullah, a 27-year-old motorcycle taxi driver who partners with ride-hailing apps Gojek and Grab. What used to be hectic days beginning in the afternoon and lasting until the next morning, are now filled with inactivity.

“I can wait for hours with no orders,” said Teddy, who used to earn between Rp 200,000 (US$12) and Rp 250,000 a day. “Now I only earn around Rp 100,000 per day.”

Teddy is one of the estimated 2 million app-based ojek (motorcycle taxi) drivers in the country whose incomes have taken a hit with fewer orders, especially for ride-hailing and shopping services. The number of Gojek and Grab active users declined 17 percent from the beginning to the end of March, according to a Statqo Analytics report.

Motorcycle taxi drivers may only be the tip of the iceberg for Indonesia’s 70.49 million informal workers — more than half of the people employed in the country — who are considered the most vulnerable to the economic downturn driven by the COVID-19 pandemic. They are unregistered, unregulated and unprotected by a proper social safety net, according to the International Labor Organization (ILO).

“If they don’t work for a day, they don’t get an income,” said Hadi Subhan, a labor expert from Airlangga University.

The situation, he added, was exacerbated by a lack of social and health protection for informal workers. “The government has lagged behind in providing protections for formal workers, let alone informal workers,” said Hadi.

India, with 80 percent of its workforce in the informal sector, has been warned by international NGO Human Rights Watch about its decision to enforce a three-week nationwide lockdown starting on March 24 to contain the spread of the virus. The lockdown “has disproportionately hurt marginalized communities due to loss of livelihood and lack of food, shelter, health care and other basic needs”, the organization stated.

India then announced a relief package of 1.7 trillion rupee ($22.2 billion) to provide free food and cash transfers to vulnerable populations. Similarly, President Joko “Jokowi” Widodo has announced plans to spend Rp 405 trillion on health care, the social safety net and business recovery programs.

Of the total spending, Rp 110 trillion has been allocated for social safety net programs, including Rp 20 trillion to cover 5.6 million laid-off workers and small business owners and Rp 150 trillion for economic recovery programs for small and medium businesses (SMEs).

The Social Affairs Ministry announced on Thursday that 3.7 million informal workers in Jakarta would be given staple food packages, in cooperation with the Jakarta administration, as part of the disbursement of the emergency fund. The ministry will use Rp 25 trillion for the aid.

“I’m very concerned about that — distributing relief through bureaucratic processes. Based on my experience, the bureaucratic process to disburse relief is very long, and it doesn’t always reach all those in need,” said Tadjudin Noer Effendi, a labor expert from Yogyakarta-based Gadjah Mada University.

Small business owner Marvin Mujito Tanoto, 35, has still not heard from his bank about loan repayment relaxations. His monthly orders have plunged by 90 percent. The Surabaya-based batik producer said because of numerous event cancellations, his monthly orders, which used to be 50 items per month, had nearly disappeared.

“I took out credit through the KUR with Bank Rakyat Indonesia. To this date, I still receive notifications that I have to pay the fixed credit. There is no provision to delay the payment,” he said, referring to the government’s microcredit program (KUR).

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