4.4 million Ugandans could lose jobs –Report

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Ugandans could lose jobs if the pandemic persists for the next six months according to the business climate index published by the Economic Policy Research Centre.

According to the Economic Policy Research Centre study, 3.8 million workers would lose their jobs temporarily while 625,957 would lose their employment permanently if the pandemic persists for the next six months. 80 per cent of the workers in Kampala predicted to lose their jobs permanently while in other regions in the country the layoffs might not be permanent.

According to the Uganda Bureau of Statistics 2018, a national estimate of employment stands at 9 million. In the event of the layoff, temporary employment will reduce by 42 per cent while permanent employment will reduce by 7 per cent.

“Over 75 per cent of employees projected to lose their jobs permanently are from the service sector. This is highly expected since most of the services in Uganda involve face-to-face an interaction which contravenes the social distancing requirement,” The report indicates.

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Business activity in Uganda has reduced by 50 per cent due to the lockdown, the report indicates.

According to the report, if the current situation persists, the majority of the medium and large firms do not foresee closure while the majority of micro and small businesses would exit the business in one to three months.

Despite some business having reduced their employee’s salaries by 50 per cent, interestingly 18 per cent of the business have increased the salaries of their employees, the report showed.

Due to a severe decline in agricultural demand and revenues, business in agriculture has undergone the largest reconstructing in the workforce and the largest decline in business activity. 76 per cent of firms in agriculture have reported a severe decline while 12 per cent reported a moderate decline.

Economic Policy Research Centre survey was conducted by sending questionnaires electronically to 147 businesses which are a panel of businesses based on the Uganda Bureau of Statistics Census of Business Establishment. The businesses were asked about their activities, price of inputs, productivity, operating expenses, demand, access to raw materials, price of output, revenues, employment, as well as credit and liquidity constraint.

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