Financial Times

Poverty Issues
Foreign jobs seen overcoming urban poverty
A new study on urban poverty shows that households that enjoy higher well-being are those that have combined low but stable sources with fluctuating but higher levels of income.

"Stable sources serve to reduce vulnerability within households but do not succeed in helping the household move out of poverty," the report by the Centre for Poverty Analysis (CEPA) titled "Understanding the dimensions and dynamics of poverty in underserved settlements in Colombo" noted.

It said that foreign employment, self-employment and enterprise are strongly correlated to higher well-being households with very few members of MWB (medium well-being) and LWB (low well-being) households engaging in them. In contrast, no member of HWB (high well-being) households engaged in wage labour, which was the primary form of livelihood for the LWB and MWB households.

The level of unemployment was high within all three categories in the settlements, but highest amongst LWB households. Categories of people who were identified as unemployed include youth, especially young men, dependants, such as disabled people, the elderly as well as the drug addicts.

A distinct feature of HWB households in the settlements was the tendency for women in the household to choose to stay at home because their source of livelihood is sufficient to fulfil the needs of the household.

The women of HWB households, who do work to supplement the household income, often work in the Middle East as housemaids, help out in the family enterprise such as a grocery shop or are employed in garment factories.

The study said many HWB households have been able to move out of poverty and improve their living conditions through certain livelihood choices, such as foreign employment, self-employment or engaging in enterprise. Foreign employment was the single most frequently cited factor in causing change of household well-being.

The second source of change is self-employment (primarily related to single person enterprises such as three-wheeler hiring, electrical work) and enterprise (larger scale self-employment, sometimes employing a few persons, often engaged in trading), which provides opportunities for higher earnings and liquidity, despite the fact that there are fluctuations in income.

Foreign employment which is a strong facilitator in moving up the well-being levels can also act as a constraint. The most common source is the inability to meet the debt-burden caused by financing foreign employment through borrowings.

Access to employment: the largest source of wage labour in Colombo is centred around the wholesale markets in Pettah, Aluthkade, Grandpass, etc. The proximity enables residents to access wage labour without incurring transport costs and they get priority for hiring by being available at the appointed times.

Housing conditions
Houses of the HWB group is characterised by asbestos roofing and brick walls while in the LWB group, more than half of the housing have tin roofs and plank walls. There is a distinct increase in the number of rooms from the LWB to the HWB households, which affect absolute space at the household level. The rooms included both bedrooms and living space, as in most households, particularly LWB households, rooms were multipurpose rooms.

The reliance on foreign remittances was most prevalent in the HWB households, followed by income and personal, savings. Only two HWB households took loans, whereas with MWB, 50% took loans to improve their houses.

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