The Market-Reach of Pandemics - Evidence from Ethiopia’s Ready-Made Garment Industry - Research Notes

Jul 19, 2026

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In a globalized world, pandemics transmit impacts through markets. The study documents employment changes, coping strategies, and welfare outcomes for garment factory workers in Ethiopia’s largest industrial park during the early stages of the COVID-19 pandemic. A phone survey of female workers captures a period of rapid global case growth but limited local spread. Results indicate major employment shifts, migration from urban to rural areas when women stop working, and widespread food insecurity.

LanguageEnglish

CategoryResearch & Report

FormatPDF

Pages8

Reading Time20 min

Introduction

Study context and motivation

Data collection and setting

Context

Industrialization in Ethiopia

Findings and implications

Employment changes, coping, welfare

Policy recommendations and future research

Public Disclosure Authorized Public Disclosure Authorized Research Notes The market-reach of pandemics: Evidence from Ethiopia’s ready-made garment industry Christian Johannes Meyer a, 1, Morgan Hardy b, 1, Marc Witted, 1 a University of Oxford, United Kingdom b New York University Abu Dhabi, United Arab Emirates c Vassar College, 124 Raymond Avenue, Box 67, Poughkeepsie, NY 12604-0708, USA dIZA Institute of Labor Economics, Germany e World Bank, USA female workers in , Gisella Kagy c, ⇑, 1, Eyoual Demeke e, 1 | a r t i c l e i n f o | | a b s t r a c t | | --- | --- | --- | | Article history: Accepted 28 August 2020 Available online 14 October 2020 | | In a globalized world, pandemics transmit impacts through markets. We document employment changes, coping strategies, and welfare of garment factory workers in Ethiopia’s largest industrial park during the early stages ofthe Coronavirus Disease 2019 pandemic. We ﬁeld a phone survey of female workers during a two month period in which cases are rapidly rising globally, but not locally. Our data suggest signiﬁcant changes in employment, high levels of migration away from urban areas to rural areas if women are no longer working, and high levels of food insecurity. These ﬁndings compel a research and policy focus on documenting and mitigating the market-reach of pandemics on low-income workers at the margins. 􀀁 2020 The Authors. Published by Elsevier Ltd. This isan open access article under the CC BY license (http:// [creativecommons.org/licenses/by/4.0/](creativecommons.org/licenses/by/4.0/)). | | JEL: I18 I12 J65 O12 D91 Keywords: COVID-19 Ethiopia Industrial Parks Employment Migration | | | 1. Introduction This research note documents impacts of the Coronavirus Disease 2019 (COVID-19) pandemic on low-wage manufacturing workers at the margins of the global economy. In the readymade garment (RMG) industry and its global value chains, the sharp economic downturn in key consumer markets has led to order cancellations. This pandemic-induced demand shock threatens the livelihoods of production workers in countries such as Ethiopia. We conduct a phone survey with a random sample of female RMG workers employed before the start of the crisis in Hawassa Industrial Park (HIP), Ethiopia’s ﬂagship special economic zone. Our data collection occurs at a time when factories are suspending production due to the collapsing demand and in a period in which ⇑ Corresponding author. E-mail addresses: christian.meyer@nufﬁ[eld.ox.ac.uk](eld.ox.ac.uk) (C.J. Meyer), morgan.hard[y@nyu.edu](y@nyu.edu) (M. Hardy), [witte@iza.org](witte@iza.org) (M. Witte), [gikagy@vassar.edu](gikagy@vassar.edu) (G. Kagy), [edemeke@worldbank.org](edemeke@worldbank.org) (E. Demeke). 1 The author order is randomized, as per the American Economic Association ([https://www.aeaweb.org/journals/policies/random-author-order](https://www.aeaweb.org/journals/policies/random-author-order)). COVID-19 is slowly spreading throughout Ethiopia, though not locally in Hawassa. This allows us to observe employment changes, coping strategies, and welfare of workers indirectly impacted by the pandemic. We ﬁnd signiﬁcant changes in employment status within our sample; 41 percent of respondents employed in HIP in January 2020 were put on leave or terminated by the time of our survey. Among those, almost no one has found other employment. Our measures of expenditures outstrip income. Levels of food insecurity are high. Many respondents who have lost employment have migrated out of Hawassa. Those who have migrated report lower levels of food insecurity, however 67 percent of our sample remain in a location that is not their desired location. Many of those who have migrated hope to return to Hawassa. Main barriers to relocation include resources and fear of health risks. This research note complements the plethora of emerging research on the direct economic and welfare impacts on ﬁrms and

FAQs

What does the study mean by the “market-reach” of pandemics?

Pandemics affect livelihoods not only through direct health impacts but also through market channels, such as demand shocks that cascade through global value chains and production orders.

How was the evidence collected from Ethiopia’s garment workers?

Researchers conducted a phone survey of a random sample of female ready-made garment workers who were employed before the crisis in Hawassa Industrial Park over a two-month period.

What were the key labor and welfare outcomes reported?

The survey found substantial changes in employment status, very limited re-employment, expenditure levels exceeding income, high food insecurity, and migration away from Hawassa among many respondents.

Jul 19, 2026

Upload by Hazel