Inequality, the GINI coefficient, and why lower income communities will be hit harder during the pandemic

March 27, 2020 Mariam Aref

Lower income communities will be hit harder during the pandemic - so please stay at home if you have the privilege of being able to.

It is not a hidden fact that underprivileged communities are hit more than others whenever anything strikes. A pandemic is no different. While it is true that technology has brought about immense flexibility to the workplace and may have single-handedly saved us from diving into a deeper recession – which would most definitely further harm those lesser privileged communities we talk about – it has also, unsurprisingly, favored the communities with better internet access.

Let’s look at a country 100 million people call home - Egypt. A method of measuring inequality would be comparing how the income is divided in the country. According to Trading Economics, the share of income held by the lowest 20 percent of Egyptians in 9.1 percent – compared to the income held by the highest 10 percent of 27.8 percent. This leaves us with a GINI* coefficient of 0.318. However, the GINI coefficient is not the statistic that matters - when it comes to working remotely, internet access is the source of the dilemma.

According to Statista, in 2019 there would have been 50.7 million internet users in Egypt – in a population of almost 100 million people. The Central Agency for Public Mobilization and Statistics recorded that there are 13.82 million households with computers, in a country where every household contains an average of four people, this would agree with the previous percentage that approximately half of Egyptians have some access to the internet. This would mean that a little less than half the population has no access to the internet. With almost 49 percent of the population remaining without an internet connection, it is difficult to expect them to not only manage to acquire an internet connection in a short period of time, but also the resources needed to, well, connect to the internet. If trends in Egypt follow as trends in every other country do, individuals with higher income usually have better access to computers and internet – an example of the concept of digital inequality**. This would leave us, again, with a dilemma. Low income households without access to the internet cannot access the new wave of working from home – how will they move forward with their jobs and begin the climb upwards if they have been thrown completely off the ladder?

Furthermore, students who come from these households may find themselves disadvantaged further, they cannot keep up with the workload that has been assigned to them without their access to their respective universities’ computer labs, printing stations, or internet lounges. With two-thirds of the population under 29 years old, Egypt contains a large number of students. Those with less access to resources will simply not be able to keep up with their classmates, which may deepen the divide between classes further. As cafes, bookstores, and university campuses close down, access to the internet will become increasingly limited for these students. How can they be expected to move forward in their studies if they cannot even access their classes?

With cafes, bookstores, and university campuses closing down, this also leads us to the individuals working in sectors that simply cannot work online. Tourism, construction, dining, and more workers are being heavily affected by this. The tourism industry, for example, has a workforce of 1.25 million, and there are not many ways to continue this practice online. Workers in this field are faced with either shutting down or going to almost-empty workstations and being around other individuals who may or may not have been exposed to the virus. Construction jobs give 3.7 million Egyptians jobs – and they cannot even take a break. Constructions workers are still expected to keep showing up to their jobs even with some new social distancing guidelines by companies. When it comes to dining, the options seem much like the options for tourism - either they shut down or show up to nearly empty settings where they may or may not be exposed to an ever multiplying virus. Think of the markets in Khan el Khalili with the vendors who now have no tourists to sell to, the shops in Attaba or the other busy daily markets that used to be flooded with life and now are barely functioning as the virus continues to take hold. There are households that depend on the monthly income they receive from these positions, so they must keep exposing themselves to the virus in public transport and close-quartered working environments simply to keep putting food in the table. The irony exists in risking their lives, everyday, to maintain their own existence.

However, there are measures being taken by the government to maintain at least lesser damages than would be possible. The Central Bank*** has ordered local banks to monitor the sectors most affected by current events, not impose additional fines, and other measures to ensure the country doesn’t dive into a deep recession. Yet it still remains the fact that there will be sectors more affected than other sectors – and the more affected sectors are almost always going to more harshly affect low income households.

Yes, the coronavirus requires us to social distance. However, we need to be aware of how our social distancing is a mark of our privilege. Access to the internet, computers, and the ability to work from home are all things that should not be taken for granted. Social distancing measures are helpful to flatten the curve and stop the spread of the disease, but we need to not forget about the people who will be most affected while we stay in our homes, browsing the web. Some households do not even have this privilege. Stay home, stop the spread of the virus, and pray that this ends soon for those individuals who do not have the privilege of working from home. Let’s keep the GINI coefficient at the level it is at and not continue pushing for the spiraling of the income gap.

Notes for further understanding:

*The Gini coefficient measures inequality as a frequency (or a percentage) from zero to one where, theoretically, a measure of zero proves that this nation supports complete equality (meaning that everyone receives the exact same income) while a measure of one states that the country is completely unequal (where someone or some group or some sector receives all of the income). Basically, it is the difference between the Lorenze curve (which shows how much of the population receives how much of the nation’s income) and the equality line (which assumes that everyone in the population takes an equal share of the income). For comparative purposes, it is useful to note that in 2020, Lesotho had the highest coefficient at 0.632, compared to the Faroe Islands with the lowest coefficient at 0.227. The United States holds a coefficient of 0.45. The GINI index relies on household data, so it is not always the most reliable source of data. Some households are simply not documented, which would make our data less reliable the more there are undocumented households.

** To learn more, check out this article on digital inequality in the USA: https://www.huduser.gov/portal/periodicals/em/fall16/highlight2.html

*** A Central Bank essentially controls the interest rates and acts as the bank of the banks.

Sources!

Al-Youm, Al-Masry. “Egypt's Mobile Subscribers Increase to 94 Million, Mobile Internet Users to 38.79 Million.” Egypt Independent, 14 Oct. 2019, egyptindependent.com/mobile-subscriptions-increase-to-94-million-internet-subscribers-to-38-79-million/.

Al-Youm, Al-Masry. “CBE Ramps up Measures to Support Egypt's Economy amid Coronavirus Pandemic.” Egypt Independent, 17 Mar. 2020, egyptindependent.com/cbe-ramps-up-measures-to-support-egypts-economy-amid-coronavirus-pandemic/.

“Analysis: What Are Egyptians Using the Internet for?” EgyptToday, www.egypttoday.com/Article/3/50919/Analysis-What-are-Egyptians-using-the-internet-for.

“Construction Sector Provides 3.7M Jobs: Min.” EgyptToday, www.egypttoday.com/Article/3/44450/Construction-sector-provides-3-7M-jobs-Min.

Gini Coefficient By Country 2020, worldpopulationreview.com/countries/gini-coefficient-by-country/.

Jaaskelainen, Liisa. “Topic: Tourism Industry of the Egypt.” Www.statista.com, www.statista.com/topics/5767/tourism-industry-of-the-egypt/.

Puri-Mirza, Amna. “Egypt: Households with Computer by Area 2018.” Statista, 10 May 2019, www.statista.com/statistics/1004709/egypt-share-households-computer-by-area/.

Radcliffe, Damian. “Tech in Egypt: Here's What You Need to Know about Middle East's Biggest Market.” ZDNet, ZDNet, 13 Dec. 2019, www.zdnet.com/article/tech-in-egypt-heres-what-you-need-to-know-about-middle-easts-biggest-market/.

Technology Access Community Centers in Egypt: A Mission for Community Empowerment, web.archive.org/web/20100311064706/www.isoc.org/isoc/conferences/inet/99/proceedings/3c/3c_1.htm.

US Census Bureau. “Gini Index.” The United States Census Bureau, 25 Jan. 2016, www.census.gov/topics/income-poverty/income-inequality/about/metrics/gini-index.html.