Income

No cheaper options: Low-income families struggling in Egypt’s economy


No cheaper options: Low-income families struggling in Egypt’s economy

Courtesy of Mostafa Kashef

The impact of inflation is not felt in the same way by all Egyptians. For the upper middle class, this has meant switching to cheaper stock options or resorting to assets that can appreciate in value, such as stocks or investments. But for the lower working class, this means more limited options or days spent buying nothing at all.

Annual urban consumption inflation in Egypt has reached 15%, its highest level in four years, according to data from the Central Agency for Public Mobilization and Statistics (CAPMAS). However, for the majority of workers, rising prices erode the real value of what they earn.

For them, economic hardship is not felt punctually, but as soon as they wake up: having to eat less variety because household products are less available, depending on the day’s income, and not knowing if they will have enough income to live. healthy enough the next day.

Sufficiency and good health are not the primary objectives. Instead, it’s survival.

This situation is accentuated by the fact that many single-parent households, especially those headed by women, face greater financial fragility and difficulties in obtaining pensions and employee rights. Four years ago, the latest data revealed that annual household expenditure per capita reached 693,931 USD (16,819.57 EGP). Yet with rising inflation, people like Um Hassan* depend on a monthly income of EGP 323 to support all of their household expenses.

Um Hassan*, who lives in Imbaba, a working-class neighborhood north of Giza, works as a housekeeper and tea and coffee maker in one of Egypt’s government institutions. From an early age, she worked to support her family, but when she married at the age of 18, Um Hassan* became a housewife.

Everything changed when her husband died three years ago.

“I never knew he was sick, we don’t usually know or notice these things,” she says. “We used to do iftar during Ramadan at my sister’s house, and we had a great time. He then got tired all of a sudden. He moved forward to look out the window, and his head began to bob from side to side. At first I thought he was dizzy, but he immediately fell to the ground and died.

Without any warning, Um Hassan* became a single mother overnight. Her daughter got married after finishing high school, and her only son struggles to find a steady job, working occasionally as a shop assistant. For nine months, she applied for government pensions or insurance, but received none because she was not considered an official employee.

“I worked day to day, so I was not officially employed. For nine long months I had no protection, no inheritance and no formal work. It was the most difficult period of my life. »

A year later, she was hired in a government institution with the help of the Takaful and Karama (Solidarity and Dignity) program, a World Bank cash transfer program to support 5 million families, or about 22 million families. Egyptians. However, his daily income is barely enough to sustain him in the face of soaring prices.

“Everything has become too expensive, and it continues to increase almost every day,” she told Egyptian Streets. A liter of sunflower oil cost 42 EGP (1.74 USD) a few days ago, and now it is suddenly 48 EGP (1.98 USD). Even 100 EGP (4.13 USD) is not enough to buy enough groceries for a week. A piece of chicken alone costs 100 EGP (4.13 USD), so it is difficult for me to cook every day, because there is not enough food.

Soaring prices and growing economic uncertainty are also not helping the health of low-income families. Over the years, due to a poor diet, Um Hassan* has struggled to obtain medical insurance to treat her heart condition.

“My health has deteriorated over the years and I haven’t worked recently because of this problem. It has become incredibly difficult to pay for medical care.

Um Nada* is another single mother, who works as a daily cleaner, constantly moving between different homes and government institutions. In total, she earns about EGP 1,200 (USD 50.43) per month, which she says is not enough to help her cook for her family every day.

“There are a lot of days that I go eat at my friends house or they eat at my house throughout the week because we can’t afford to eat individually every day,” she says. “I also have two children who have recently started their school years, and they need school bags, pencil cases, notebooks and many other teaching materials. A school bag alone costs 100 EGP, so sometimes my friends and I pool our money to pay for all school expenses.

New Policies

The struggle of the working class calls for new policies, as the question of how to help low-income families cope with the new realities of economic uncertainty must be addressed.

Although Egypt has introduced a number of policies aimed at reducing poverty, namely Hayah Karima (Decent Life), other economists argue that the solution is rooted in addressing power imbalances in the economy, where low-income workers cannot voice their challenges. , needs and concerns.

In times of crisis, large institutions and corporations have the upper hand in their dealings with workers, usually having the final say on firing or hiring employees or raising their wages.

However, employees must also restore their bargaining power. Strong unions are able to set job quality standards that non-union companies must meet in order to compete for workers. According to recent research, union members in Egypt receive higher salaries, but they vary by profession and sector.

With growing economic uncertainty, Egypt’s low-income working class will have to struggle not only with the rising cost of living, but also with the rise of corporations and institutions. Further research is needed regarding the relationship between unions, wages and inequality in the Egyptian economy.

*Names have been changed for security reasons.

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