Economic effects of the Covid-19 pandemic on the informal economy: who has fallen into poverty? Figure 5.2 Reported decrease of household incomes because of the Covid-19 pandemic 100% 80% 60% 40% 61.3% 59.6% 55.4% 69.8% 66.5% 42.8% 20% 0% Côte d’Ivoire Ethiopia Capital city Other urban areas Rural areas Figure 5.3 Income poverty before and during the pandemic 100% 80% 60% 40% 20% 27.9% 46.6% 0% Côte d’Ivoire Income poverty before the pandemic 44.5% 67.2% Ethiopia Income poverty during the pandemic 5.3.3 Income poverty In order to understand the extent to which decreases in employment opportunities and household incomes have led to changes in household income poverty, the house­hold heads had to indicate first whether their»household incomes were lower«,»the same« or»higher« in the past month compared with the same month before the pan­demic. After answering this question, they had to specify the amount of income they had gained or lost as a result of the pandemic. This information makes it possible to assess household income before and during the pandemic and to explore possible changes in household income poverty. Households are defined as income-poor when the per capita household income is equal to or less than the international extreme poverty line. In Côte d’Ivoire, households that earn less than the statutory minimum wage of 30,000 CFA francs (54 US dollars per month) are considered to be income-poor. In Ethiopia, households that earn less than 1,500 Birr(41 US dollars per month) are considered income-poor. 2 Figure 5.3 shows how the shares of households that are considered to be»income-poor« have changed as a result of the Covid-19 2 The thresholds in both countries are below the international extreme poverty rate of 1.9 US dollars per person per day. pandemic. In Côte d’Ivoire, household income poverty has increased by 19 percentage points. Before the pandemic almost one-third of those working in the informal economy were income-poor, while after the first wave of the pandemic this rose to one-half. In Ethiopia, income poverty levels are generally higher, but a similar increase of income poverty by 23 percentage points can be observed. Almost 70 per cent of people in employment earn less than or equal to the extreme poverty line. In order to explore whether these changes vary between urban and rural areas, Figure 5.4 depicts the change in income poverty for the capital cities, other urban and rural areas. Income poverty has increased to a larger extent in urban areas than in rural areas. The share of households considered to be income-poor increased by 16 percentage points in rural areas in both countries. In contrast, urban income poverty increased by 25 percentage points in Ethiopia, and in Côte d’Ivoire by a little less, at 21 percentage points in other urban areas. In order to explore what types of households face income poverty due to the pandemic, the perspective of the analysis changes, focusing on household characteristics. So what types of household have fallen into income poverty and do 43