CHARTING CHANGE: EXAMINING THE IMPACT OF COVID-19 ON LESOTHO'S INFORMAL ECONOMY THROUGH THE HAIRDRESSING SECTOR
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Abstract
The declaration of the coronavirus, or COVID-19, as a pandemic by the World Health Organization (WHO) on March 11, 2020, marked a significant turning point in global public health. With over 88 million confirmed cases and 1.9 million deaths worldwide as of January 10, 2021, the pandemic has had profound impacts on societies and economies worldwide. In Lesotho alone, the virus has led to 2577 confirmed cases and 50 deaths, highlighting the severity of its impact even in smaller nations. Beyond its toll on public health, COVID-19 poses a formidable economic and financial threat, with far-reaching consequences for the global economy.
To curb the spread of the virus, affected regions and countries, including Europe, China, and the United States (US), implemented stringent measures such as physical distancing, movement restrictions, and nation-wide lockdowns. While the severity of these measures varied, their effects on economic sectors were universal, leading to significant disruptions in production and employment. Non-essential economic sectors experienced drastic reductions in working hours, resulting in a surge in unemployment and economic inactivity.
Of particular concern is the rapid rise in economic inactivity, outpacing the rate of unemployment growth. This trend underscores the multifaceted challenges posed by the pandemic, as individuals not only lose jobs but also withdraw from the labor force altogether. Such trends portend long-term consequences for economic recovery and societal well-being, necessitating comprehensive policy responses to mitigate their impact.
This paper examines the economic repercussions of COVID-19, focusing on its effects on employment and economic activity. By analyzing data from affected regions and countries, it seeks to elucidate the magnitude and dynamics of the pandemic's impact on labor markets and economic resilience. Additionally, it underscores the need for targeted interventions to support affected individuals and sectors, fostering a sustainable path to recovery in the post-pandemic era.