Global Recession Impact: Personal Stories from Informal Workers

Uncertain Times

The global economic crisis that rocked the world in 2008 led to increased financial hardship for informal workers, most of whom already lived in precarious circumstances. Here is a sampling of their stories, told during  2009 and 2010. 

Pushpaben Kishorkumar Kapani, Diamond Polishing, Ahmedabad, India

Informal Worker

I followed my husband’s trade and took up diamond polishing. I had also undergone training in diamond polishing, prior to taking up this work. I am 33 years old and have been residing in Ahmedabad since birth. I have studied up to college.

My husband and I made good money through diamond polishing. My husband’s monthly earnings were Rs3000 (US$62.05) and my monthly earning were Rs2000 (US$41.37). We have a daughter who is studying in the 4th Standard. She would be left under the care of our neighbours, while we were away at work. We were able to cater to most of the needs of our daughter.

Everything was going well and then … all of a sudden, fate changed due to the onset of the financial crisis!!! It is over a year now.

Diamond work was very badly affected by the financial crisis. There were more than 1000 diamond polishing factories in Ahmedabad city. Most of these factories have shut down. Thousands of people lost their livelihood and became jobless. My husband and I also lost our jobs. We became helpless. Life became very tough. There were problems due to the shortage of food at home. At times – we were unable to get food for two days. Our daughter had to discontinue school as we could not afford school fees.

We left Ahmedabad and went to village and tried to work on farms. But the earnings were very low and, moreover, our daughter was being neglected and getting spoiled. So we returned to Ahmedabad. My husband started working in an iron factory. He was getting 100 rupees per day (US$2.07). However, all his earnings were being spent on house rent and other domestic expenses. We were unable to afford proper food. I took up embroidery work as I had some experience in it. But here too – the earnings of around 12 rupees per day (0.25 USD) were not sufficient.

The financial crisis has made the situation of so many similar to that of ours. Being the eldest at my in-laws place I have to take on a lot of responsibilities. I had never thought or expected to be in this situation!!!

A kot of questions enter my mind: “When will the factories open again? What is my daughter’s future? What about her marriage?” These thoughts depress me.

Due to increasing prices we are unable to afford proper food, clothing and medical treatment. A big question in front of us is – “What work to do?” I do not know when the financial crisis will end – it is finishing us!!!

Hear My Prayers 

Ashaben Vithalbhai Patni, Vegetable Vendor, Ahmedabad, India

Informal Worker

“The clock strikes five and I usually begin my day with praying: Bhagwan aaje mara chokrao samu joje ane amaru kaik saru karje. (‘Oh god, kindly look after my children today and do some good to us.’)”

These are the words of Asha-ben Vithalbhai Patni, mother of four children and a vegetable vendor, who at the age of 28 is relatively content with her own life but worries about the future of her growing children. She wants to educate her only daughter, the eldest child, so that she will not have to struggle as she herself has.

Asha-ben is a vegetable vendor at Khodiyalnagar near Bapunagar in the city of Ahmedabad. Her family of six includes one daughter, three sons and her husband. Her children are going to a municipal school and she finds it difficult to keep them in school as she does not have enough money to buy books and other necessities.

Asha-ben keeps her vegetable hand cart near a foot path which became over-crowded with other vegetable vendors as more and more people lost their jobs and tried their hands at vending, as it does not require any capital or investment. The area where she sells vegetables is surrounded by many small scale diamond polishing factories. The diamond factory workers, when returning home in the evening, usually buy vegetables from her, which gave her a regular income.

Previously her husband used to go to a textile mill and did some labour work to help support the family. Then the mill closed down and he lost work. For Asha-ben the struggle in life began very early, soon after she was married, when her husband was unemployed for a few months. For a few days, the family survived without food. Earlier Ashaben and her husband together used to earn 200-250 rupees daily.

 

Diminished Earnings

Orlando López, Rug Maker, Oaxaca Mexico

Orlando lives in Teotitlán del Valle, a town near the city of Oaxaca where the Zapotecs have woven elegant and colorful rugs for centuries, using the same traditional technique. The tapestries and rugs are then sold on the streets of Oaxaca, mainly to tourists. The rugs are made entirely by hand, everything from the design to setting the loom, including carding and dying the wool with natural colors and materials such as marigold, moss and the insect cochineal. Each rug is unique and takes up to two weeks to produce. Despite the labour-intensity and care of the process, a large rug is sold, on average, for only US$80.

Orlando Lopez was born and raised in Teotitlán, and he started weaving and selling rugs when he was 5 years old. In his thirties, he continues supporting his family of seven by selling his art. Or at least, he is trying. The economic crisis and the H1N1 virus have taken a devastating toll on tourism, which provides the main clientele for Orlando and all the weavers. “When the crisis started my earnings were reduced up to 40 per cent, but with the influenza scare they were lowered by 80 per cent or up to a 90 per cent,” he said when asked about how his earnings were affected by the crises. “In April of 2009 I sold an average of three to four rugs per week. In May of 2009 I did not sell one single rug the whole month.”

Orlando lives with his wife, three daughters, his mother and his brother. The adults work on average between 14 and 15 hours a day, seven days a week. And although the sales of his rugs have diminished, his workload has not; they all continue working the same amount of hours, creating products of even better quality to be able to remain competitive.

Orlando’s positive attitude is inspiring. He is thankful that he has been able to survive and endure the consequences of the two catastrophic crises. Still, he acknowledges that things are far from easy – in what he would describe as being a good week of sales, he would earn around US$70 after covering production expenses; in a bad week, he would make no money at all. The future of his trade and the other weavers and artisans of Oaxaca remains uncertain. 

Longer Hours for Less

Sabina Carlos, Market Vendor, Lima, Peru

Sabina is a market vendor at the La Pampa extension of the Huamantanga Market, in Puente Piedra – a highly populated district in the north end of Lima, Peru. She is the Organizing Officer of her local vendors’ association, and also belongs to the leadership of the Lima Federation of Street Vendors, FEDEVAL. She sells Creole food and fruit juices at a rented stall, which lacks a paved floor. She purchases her inputs at the wholesale market of Puente Piedra. She usually starts at 6 a.m., together with her daughter, who studies computer science in the evenings and hopes to obtain a stable job in the near future.

Before the crisis, Sabina worked nine hours per day; but during the crisis her work-days extended to 12 hours. The crisis has had a negative impact on her income, as she explains: “Last year I was making up to 20 soles per day (approximately US$6.5). Nowadays, I am only making 10 soles.” This represents a survival income, considering that she has to pay 150 soles (US$50 approximately) monthly rent for her market stall to an intermediary firm, which happens to belong to the mother of the current mayor of her district – who at the time of this interview not been denounced.

Sabina does not count on any social security benefit. She usually turns to traditional medicine for minor problems. If something severe happens, she could not afford it. She cares for two grandchildren from her eldest son, who is in his mid-thirties and works as a casual microbus helper – a job of long hours and little pay.

More and more vendors compete with Sabina every month, which affects the volume of her sales. She has decreased the amount of product per serving to adjust to the price competition. She has also created new dishes to attract new customers and keeps the same price she used to sell for months ago in order to keep the caseros, her most loyal customers. On bad days, she adds a few hours of work at night, selling sweets on the street, where the income is not great and there are security risks, but it helps.

Trying New Things

Josue Ramos, Street Vendor, Lima, Peru 

Josue is a street vendor who belongs to the association of vendors of Downtown Lima. He is also part of the Leadership of the Lima Federation of Street Vendors, FEDEVAL, of which he was one of the founders in the 1980s. He has endured many battles with municipal and police authorities through the years to keep his livelihood as a vendor.

Josue sells natural food products, mainly potato chips, sweet potato chips, and popcorn, which he cooks and packs himself every day after buying the inputs early – 5:30 a.m. – at the local wholesale market. He works with his daughter. She has a fixed stall outside the Central Market of Lima Downtown for which she pays 200 soles per month.

Josue vends around the streets of Downtown Lima. He used to earn 30 soles per day (US$10), working 10-hour days. At present, business has decreased, and he is getting only 18 soles per day. The global economic crisis has intensified competition and persecution from municipal security services too, as more traders turn to the streets.

Josue has taken several measures to face the current economic crisis. To improve his product and create new varieties of it, he obtained funds through his turn on the pandero (a rotating savings mechanism by which all participants make a monthly contribution towards a collective pot of money, and each of them takes the fund once, at one month in the year). He has also located better and cheaper suppliers, and is expanding his area of work to sell at other places in the city, including the popular festivals that take place on weekends in different districts. He has not increased the unit price per package but has reduced the amount of food per package.

His daughter knows a bit about computers and the web. She created an email address for him through which he offers some products, and will create a blog for him to market his products, in the search for new clients. He also aspires to learn more about information technology to expand his opportunities.

Even though the volumes he sells are small, he is very proud of his own recipes and knows his customers seek him out because of the quality and taste of his products.

Secure in Times of Insecurity

Mangal, Waste Picker, Pune, India

Prepared by Kagad Kach Patra Kashtakari Panchayat
(KKPKP), the trade union of waste pickers in Pune, India, based on
interviews as part of the global study on the impact of the global
crisis on the urban informal workforce.

Jagannath mumbles in a drunken stupor as Mangal tells him to stop making a nuisance of himself. He was not always like this… there had been a few years of respite when he stopped drinking, egged on by his wife Mangal and the KKPKP. Indeed, he would address the other alcoholic husbands, chest puffed with the heightened sense of his own importance, recounting his recovery from alcohol. Now he lies next to his inebriated son, leaving Mangal, strangely enough, stronger because at the end of hoping and trying and coaxing and cajoling, she has realized that all she has to rely on is herself!

The spoilt son fancied himself as an artist, and quite honestly he did paint well, but now he plays hide and seek with sobriety. To think of all those years she indulged his fancies – first a DVD player then a motorbike. Her two daughters never made any such demands. She knew she was spoiling him, ignoring well meaning advice from the neighbours, other waste pickers and KKPKP workers. He goaded her, saying, “I didn’t ask to be born, you brought me into this world so now you have to cater to my needs,” and she succumbed.

If there is one thing that Mangal knows with certainty, it is that her earnings from waste and scrap are what support her family. She was instrumental in setting up the union, which enabled her to find herself as a person. She emerged from the shadows of living with an abusive husband to become one of the most respected leaders of the KKPKP and the Treasurer of the credit cooperative. She recalls that she used to wet her pants with fear when her husband came close to her, and now thinks that perhaps he does the same when he sees her address thousands of members of the KKPKP at a public demonstration.

She doesn’t need KKPKP to deal with him now. As a matter of fact, she helps other abused women in the community. Actively involved in all the KKPKP programmes, her children never did take much to education, despite her best efforts. Acutely conscious of her rights, she argues that she reduces the waste handling costs of the Pune Municipal Corporation, in return for which the PMC pays her medical insurance premium. She took a loan from the credit cooperative to construct a house with a mezzanine floor.

Recession? Mangal believes it has not really affected her. In any case, her collection in user fees from door to door collection of waste fetches her much more now than the sale of scrap. So in some manner, she has been “formalized” as a service provider. There is no difference in the amount of scrap that she gets because she services a middle class locality where consumption has been relatively steady over the years. She says her neighbour who services an area where young IT (information technology) professionals live has reported a drop in scrap. The scrap trader has not reduced the prices either in the full knowledge that it will not be pleasant if she chooses to mobilize her colleagues against him. She drives a hard bargain, claiming the best possible deal from him for her colleagues.

But there is no bargaining with inflation and that pinches, making life difficult.

More Stories: First-Person Accounts of Coping with Crisis 

For other first-person accounts of how the economic crisis impacted workers in the informal economy, read these stories: