“MY brother and I are engineers. We used to work in Lahore. When the lockdown started we moved back to our house in the village. This was to reduce expenses as well. My father has a small business. Well, he had one, I am not sure if he will be able to resume activities after the lockdown. We have a severe cash flow crunch. My brother was laid off when the lockdown started. I got my salary for the last two months, but I am not sure how long this will this last. I have been working remotely but my employer has not been allowed to open up business despite the easing. So, I am not sure how long he will be able to pay us. My salary has not been enough to sustain our expenses. Initially, we dipped into our savings and then we have been borrowing from friends and relatives. Not sure what the next few months will be like.”

Javed is an engineer. He has a good job. Before the lockdown he was thinking of working for a couple of years, saving some money for himself and for the family and then going abroad for a graduate degree. Now he is not even sure if he will have a job next month, and his family is in dire need of cash. Javed’s household is not eligible for most of the social protection programmes that the government is offering. And they do not want that help either. Their needs are different. Javed and his brother have education and skills. They need jobs. And they need capital to restart their father’s business. Without access to reasonably priced capital, restarting the business will not be possible. And without jobs and the business, they will not be able to pay back loans or ensure a steady income for the family.

How do we make policies — and we will need innovative policies — to address vulnerability?

“I have six children. Three are grown up and were working till before the lockdown. Three are still school-going. We live in a two-room house. I work as a driver. The nine of us, including my father who lives with us, have been cooped up in this place for more than two months now. My eldest is a motorcycle mechanic, second one is a barber and my daughter worked in a beauty salon. Though the lockdown has been eased up, my children and I have not been called back to work. All three of my children were told, at the start of the lockdown, that they would not be paid for the lockdown period as businesses were closed for that period. My employer has been paying me my regular salary and a bit more. This has kept our kitchen going.”

“It is a very strange situation. Now that the lockdown is almost gone, I want my children to get back to work. We need their income to meet expenses. I have accumulated some loans over the last two months and I need to pay these too. But I do not know if they will get work. I also worry that if they do get work, will they get sick? It seems the virus is spreading now. How will I protect my children? How will I protect my elderly father? He is already ill and needs a lot of support and care which my wife and children provide. What will happen to him if any of my children fall ill?”

Though Iqbal did not have any savings, beyond ownership of the two-room house where he lives, his salary and the salaries of his three children were enough to meet all expenses of the nine-member household. For the last two months they have been down to just Iqbal’s salary. And it is not clear if his children will get their jobs back and when. They were working in the informal sector so they do not have any social protection or access to any other benefits. They do not even have any paperwork to prove they had been working before the lockdown. The household was not ‘poor’ if we go by terms that are most commonly used to define poverty or are used to determine access to social protection programmes. But the household was very vulnerable. It was vulnerable to employment and health shocks. And the employment shock has led to their falling into poverty.

Poverty numbers in Pakistan had come down significantly over the last couple of decades. The current shock will change these. Vulnerability, defined through notions of exposure to risks from shocks, has remained consistently high in Pakistan. And this is what is leading to significant disruption and distress in the coming months and years. If the economy does not revive quickly, a lot of families like Javed’s and Iqbal’s will fall into poverty. Traditional social protection tools will not reach such families. We will have to seek other ways of reaching them.

Iqbal, in his conversation, pointed out the dilemma clearly. He wants his children to get back to work as quickly as possible but he is also concerned about their health and the health of other household members in case his children do go to work. He does not really have much of an option and will take a risk with the health and life of household members if his children do get some work, but, as a society, do we think that this a fair risk and cost for low-income families to bear? The easing of the lockdown seems to be saying that it is.

The task for government and policy experts, though difficult, is clear. How do we make policies, and we will need innovative and new policies, for addressing vulnerability? The immediate task might be to stave off hunger, but as we ease lockdowns, the real task would be to get the vulnerable back on their feet while keeping them away from health, employment and income shocks.

The writer is a senior research fellow at the Institute of Development and Economic Alternatives, and an associate professor of economics at Lums.

Published in Dawn, May 15th, 2020