For decades, one of the most important indicators of global well-being has kept moving in the right direction: Extreme poverty has been falling.
Although experts can and do debate the details, hundreds of millions of families moved from subsisting on less than $1.90/day (the World Bank’s standard for “extreme poverty”) to living on a little more. To be sure, it’s still not enough, but it has meant less hunger, less premature death, and more opportunity. Despite wars, famines, and natural disasters, extreme poverty has fallen for the last 50 years.
The World Bank predicts the number of people living in extreme poverty will rise by anywhere from 70 million to 100 million this year, and may stay that way for several years as the coronavirus-related slowdown in economic growth is expected to linger — especially in countries such as Nigeria and India, where many of the world’s poorest people live.
The number of people surviving on less than $3.20/day (the World Bank’s standard for “poverty”) is also expected to rise, by between 170 million and 220 million people. By other means of measuring poverty, the toll might be even worse: The United Nations has a metric that tracks access to clean water, adequate food, electricity, and schools, and it estimates that 490 million people will lose access to one of those things within the next year.
While extreme poverty was rare outside of sub-Saharan Africa in 2019, many of the people projected to slip into it live in South Asia. In a September 28 report, the World Bank finds that in South Asia, “The COVID-19 shock is not only keeping people in poverty, but also creating a class of ‘new poor.’” That’s not only in countries hit hard by the virus but on the broader region. “The employment and earning impacts of the pandemic have been large and widespread,” the report states, a consequence of a triple shock from “the pandemic itself, the economic impact of containment measures, and reverberations from the global recession.”
Countries such as India have seen massive migration in recent months as the urban poor, unable to survive in the city, disperse to rural communities where the cost of living is lower and they may at least have family. India officially has recorded 10 million people departing the city — an enormous migration in its own right — but the Economist argues that it may be an undercount by a factor of five.
Overall, depending how you measure it, Covid-19 represents a setback in the fight against global poverty on the scale of years, maybe decades.
The World Bank’s estimate of the impact of Covid-19 looks at economic effects from lockdowns and stay-home orders as well as economic effects of, for example, a collapsing tourism industry, a sudden dramatic decline in demand for oil, disruptions to manufacturing and supply chains, and other indirect effects of the virus’s ripples around the world. Most of the devastation was not caused directly by the virus but by the worldwide economic recession brought about by the virus and our efforts to fight it.