Urban Poverty in Bangladesh: Causes, Consequences and Coping Strategies

Abstract

BWPI Working Paper 178Creating and sharing knowledge to help end poverty www.manchester.ac.uk/ overty in Bangladesh: causes, strategies 8Creating and sharing knowledge to help end poverty www.manchester.ac.uk/bwpi 2 AbstractBustees are places where physical, social, economic and political vulnerabilities collide, creating a multi-layered blanket of vulnerability for their residents. Although income is central to day-to-day survival in an urban environment in which cash income is needed to meet a household's basic needs, work options are limited to low-paid and irregular work, primarily dependent on physical labour. This forces households to rely upon loans and labour mobilisation strategies to get by. Unsanitary, poorly serviced, and densely populated environmentsfrequently situated in environmentally hazardous areas -mean ill health is both endemic and chronic, playing a routine and devastating role in the lives of the urban poor. The repercussions of resource scarcity at the household level are compounded by the social and political exclusion of the poor from urban governance structures and processes. Amidst a lack of formal institutional support, and in the absence of formal rights and entitlements, the process of facilitating and maintaining patron-client relationships is a central coping strategy for the urban poor. It is a means of trying to manage uncertainty and improve their access to resources. For the majority, however, these strategies are limited to helping households to cope, rather than advancing their interests. Informal systems of governance at the bustee level reproduce and exacerbate existing inequalities, with access to power, information, resources, employment and other lucrative income-generating opportunities limited to a close circle of wellconnected bustee households.

Livelihoods Limitations: The Political Economy of Urban Poverty in Bangladesh

“…Across the four communities, rental tenants constituted between 66 and 83 per cent of all households (Banks 2012). Rent and utility costs -costing on average between 18 to 22 per cent of the monthly incomes of tenants across the four settlementscombined with expenditures on food, fuel and health care, lead to high monthly expenditures that few low-income urban households can be assured of meeting with their unstable incomes.…”

“…Rent and utility costs -costing on average between 18 to 22 per cent of the monthly incomes of tenants across the four settlementscombined with expenditures on food, fuel and health care, lead to high monthly expenditures that few low-income urban households can be assured of meeting with their unstable incomes. Only 45 per cent of households break-even or have an income surplus each month once these costs have been taken into account (Banks 2012), 4 and if taking into account the average monthly expenditure on health costs on top of this, only one in three households have sufficient income to cover household expenditures without going into debt. The research found three strategies distinguishing between coping and improving households regardless of their employment status: labour mobilization; investment in productive assets; and the pursuit of alternative forms of financing through savings and loans.…”

“…Some are agency-related, including limited skills, qualifications and experience, limited capital and regular ill health. Others are structural, woven into a hostile labour market characterized by oversaturated markets and intense competition, low wage rates, difficult and unhealthy working conditions, work irregularity and the mediation of the labour market by intermediaries (Wood and Salway 2000;Opel 2000;Garrett 2004;Hossain 2005;Banks 2012;Roy, Jahan and Hulme 2012). Unemployment rates are low given the necessity of work to survival, but underemployment and seasonal fluctuations in employment make income security a severe challenge for low-income urban households in Bangladesh (Garrett and Downen 2001).…”

“…Across the four settlements, 58 per cent of households mobilize female labour, and the research finds that the prevalence of female labour rises with several indicators of insecurity. Female employment increases to 65 per cent of households headed by unskilled labourers, for example, and was also highest (64 per cent households) in the community where social problems of drug addiction and gambling were widespread (Banks 2012).…”

“…Many of these owned the most lucrative form of asset, rental rooms. With landlords owning between one and 22 rooms, for some this generated monthly incomes far above even the highest paid jobs, and subsequently, enough stability to consolidate and maintain household improvements over the longer term (Banks 2012).…”