The shock caused by the COVID-19 pandemic has had considerable impacts on Ghanaian businesses, forcing many firms to cut costs by reducing staff hours, cutting wages, and in some cases laying off workers altogether.
This is according to results from a new COVID-19 Business Tracker Survey conducted by the Ghana Statistical Service (GSS), in collaboration with the United Nations Development Programme (UNDP), and the World Bank.
The results show that about 770,124 workers – 25.7 percent of the total workforce tracked – had their wages reduced and about 42,000 employees were laid off during the country’s COVID-19 partial lockdown. The pandemic also led to reduction in working hours for close to 700,000 workers.
At the release of the data, the Government Statistician, Professor Samuel Kobina Annim said, “Government has already put in place diverse supports for businesses including the establishment of a Coronavirus Alleviation Programme to protect jobs, livelihoods and support small businesses. And, also is the Government’s GHc 600 Million Stimulus Package to small and medium scale enterprises (SMEs). The findings of the Business Tracker provide specificity on the pathways of effects, variation in the effects for different categories of businesses, their geographical areas, and the extent of effects.”
The survey was carried out between May 26 and June 17, 2020 across the country to assess how the novel coronavirus has impacted private businesses. Some 4,311 firms were interviewed.
The data also show that during the lockdown, about 244,000 firms started adjusting their business models by relying more on digital solutions, such as mobile money and e-commerce through the internet for sales.
Generally, the results indicate that during the country’s COVID-19 partial lockdown, businesses received shocks in supply and demand for goods and services. Close to 131,000 businesses had challenges accessing finance and expressed uncertainty as to the business environment.
The average decrease in sales, according to the findings, was estimated at GHc 115.2 million, with firms in the trade and manufacturing sectors (including exporting firms) largely affected. More than half of these firms had difficulties in sourcing inputs due to non-availability or increase in costs, leading to challenges in covering revenue shortfalls.
Even though the lockdown measures have been relaxed, the survey results show a high degree of uncertainty in the expectations of firms regarding sales and employment over the next six months.
To lessen the impacts of COVID-19, the survey results suggest the need for policies to support firms in the short and medium terms. The most desired policies cited by the private sector include measures to improve liquidity such as subsidized interest rates, cash transfers and deferral of tax payments.
The Business Tracker Survey is part of a global Business Pulse Survey (BPS) initiative of the World Bank, surveying the impact of COVID-19 on the private sector in more than 40 countries.