Impact of the COVID-19 Pandemic on Income Inequalities in Cameroon: The Influence of Employment Status

Abstract

Abstract Due to interruptions and closures of activities resulting from social distancing measures implemented to limit the spread of the virus, individuals have seen their incomes reduced, increasing poverty and pre-crisis inequalities. These inequalities have been exacerbated by measures such as the increase in family allowances, which only benefit civil servants. The objective of this study is to analyse the contribution of the activity situation due to COVID-19 to household income inequalities in Cameroon. The data used are those collected from 604 households by CEREG as part of an IDRC-funded study on the impact of public policies related to the COVID-19 pandemic in Burkina Faso, Cameroon, Côte d'Ivoire and Senegal. The Gini and Theil inequality indices show increased income inequality in households where the head is not employed. The conditional quantile regression shows that employment status has a significant and higher effect during severe restrictions on the incomes of typical households in the 25th, 50th, 75th and 90th percentiles. On the other hand, this increased the distribution of income inequalities within households in the first three quartiles, more than 70% of which can be explained by the change in behaviour resulting from the loss of employment by the heads of household. This result is confirmed by the fact that the share of employment in the formation of income inequalities fell during severe restrictions, according to the Shapley decomposition.