Jamshed M. Kazi, Maesy Angelina, Nila Marita
Wed, Mar 31, 2021
Half of all micro and small enterprises (MSBs) in Indonesia are either owned by women or women play a key role in their operation. Including small traders, street vendors and others, these businesses form the backbone of Indonesia’s economy.
The ills of the pandemic, however, have resulted in declining incomes and the female MSB owners are disproportionately ill-equipped to cope. This highlights the need to support women owners of MSBs and in so doing contribute to the overall economic recovery of the country.
According to Statistics Indonesia (BPS), MSB women are at the forefront of adopting digital tools to stay afloat during the pandemic. But what does it actually mean for them to use these tools to deal with challenges, such as limited income streams due to physical distancing measures?
UN Women and Pulse Lab Jakarta recently released a research report that investigates this issue, titled “Optimizing Digitization to Address COVID-19: An Indonesian Case Study of Women-Owned Micro and Small Businesses”.
Funded by the United Nations Multi-Partner Trust Fund for COVID-19 Response and Recovery (MPTF COVID-19) and conducted in partnership with Gojek and with the support of the National Council for Financial Inclusion of Indonesia (S-DNKI ), research has found that using digital platforms to sell products and services helps women-owned MSBs in the food and beverage industry keep their businesses afloat and support themselves. of their families.
In addition, 82% of female MSB owners surveyed indicated that using digital solutions, such as GoBiz, Selly and MokaPOS, allowed flexible hours to better balance work and household responsibilities at a time when care work is crucial. .
Most importantly, the benefits of digitization are not felt equally by all ESM women. The analysis showed that digital tools were particularly useful if the company was less than a year old. Inequalities in infrastructure, digital skills, affordability and time availability also inhibit the ability of some women to adopt and navigate new digital tools.
As the Indonesian government will continue to focus on economic recovery in 2021, now is the time to create synergies between boosting economic growth and advancing gender equality. So what can we do to help female MSB owners take advantage of digital tools to keep the lights on at work and at home?
Filling the data gaps is one of the essential first steps to understanding the full impact of the pandemic, especially the gender dynamics within the MSB sector. Investing in sex-disaggregated data collection and gender analysis can better inform targeted policy interventions, including monitoring the implementation of social protection and stimulus programs.
For example, information from the data highlighted that women who had informal MSBs were the least likely to access benefits such as those provided through government programs, including the National Economic Recovery Program ( PEN) from Indonesia, the Keluarga Harapan (PKH) and Kredit Usaha Rakyat (KUR) program. This evidence can and should be used to tailor stimulus packages and ensure that effective measures are in place to support these groups of women entrepreneurs.
Second, women are more likely than men to be employed informally, and many depend on MSBs for their livelihoods. Cash transfers, fiscal stimulus packages, and working capital loans or credit guarantee programs for MSBs, including informal MSBs, can help them cope and revitalize the economy. Targeting female-owned MSBs, especially those operating informally, should be a key priority in the response to COVID-19 to ensure equal opportunities and accelerate economic recovery.
Third, tackling the unequal distribution of unpaid care and domestic work is key to removing barriers to women’s economic participation, especially in the context of the COVID-19 recovery. Digitization and the use of technology will be more useful if it can help entrepreneurs and / or MSBs to better balance their family and work responsibilities. The promotion of digital literacy among female MSB owners is also necessary to support this change.
Fourth, supporting women entrepreneurs will require a multi-stakeholder approach. Public policy must be complemented by actions resulting from intersectoral partnerships between the government, civil society organizations and the private sector. While 43% of new merchants who join GoFood are first-time business owners, technology or funding alone is not enough to help these young businesses thrive. Instead, a multidimensional approach including access to capacity building, markets and loans can have a more lasting and meaningful impact.
There is no single answer to the COVID-19 crisis, and therefore none of these four solutions is more important than the others. The different characteristics that define men and women entrepreneurs, from their gender and location to the size of their company and their level of formality, have motivated them to adopt different solutions to face the crisis.
The coping strategies deployed by Indonesian companies vary widely based on their different characteristics, which can be visualized by moving these seesaws.
Ultimately, these recommendations indicate a more inclusive strategy for the PEN program that should be based on gender-specific data and evidence, stronger targeting of female-owned MSBs, addressing inequality of unpaid care. and domestic responsibilities, and multisectoral partnerships to promote a strong and sustainable environment. economic recovery.
Jamshed M. Kazi is UN Women Representative in Indonesia, Maesy Angelina is Social Systems Manager at Pulse Lab Jakarta, Nila Marita is General Affairs Manager at Gojek.