Urban impoverishment and multiple modes of livelihood in Ghana

Abstract

Introduction The economic crisis that characterized many African economies in 1970s and early 1980s led to intensification of poverty, particularly among urban residents. The increased urban impoverishment has been due in part to rapid urbanization accompanied by unemployment and underemployment. However neo-liberal economic reform packages supported by international financial institutions and being implemented in many of countries have not been designed to address problems of urban poverty. In fact, neo-liberals argue that African countries have `urban bias' economies. Consequently, living standards of many urban dwellers, especially those on fixed incomes have remained poor. The disruption of established means of income generation of individuals and households has had profound effects on their livelihood strategies. Many people have responded to changes by becoming involved in multiple economic activities that combine salaried and non-salaried jobs. Although such practices have a long history in African countries (Morna 1989), neo-liberal reforms have made this strategy imperative for people of diverse socio-economic backgrounds (Chew 1990; Roenen et al. 1997). The changes in livelihood strategies, including those earning fixed income, have eluded academicians and policymakers who have typically focused on urban poor (1) and their desperate attempt to survive through so-called informal sector. Emphasis on poor has led to use of `survival strategies' to describe responses to economic crisis (Ewusi 1984; Pellow and Chazan 1986; Yeboah and Waters 1997). But as Redclift (1986) argues, strategic responses to economic change are not limited to poor; many other social groups are also involved. The use of term `survival strategy' precludes possibility that strategies may in fact be a means of accumulation. This paper employs `livelihood strategies' as a framework to capture all responses to economic change, including those meant to ensure survival as well as those employed to accumulate resources. Using concept of multiple modes of livelihood (MML), this paper examines livelihood strategies of salaried employees. (2) The purpose is to demonstrate that people of diverse backgrounds employ multiple livelihood strategies both as survival and accumulation strategies. It also highlights magnitude and complexity of livelihood strategies, as well as factors influencing participation in such strategies. The remainder of paper is divided into six sections. The next section conceptualizes relationship between economic decline, urban poverty and proliferation of multiple livelihood strategies. The subsequent four sections provide brief descriptions of sources of data and case study areas, estimate magnitude of multiple livelihood strategies, examine nature of MML activities, and discuss general correlates of MML participation. The final section addresses policy and theoretical implications of study. Urban Impoverishment and Multiple Modes of Livelihood: Exploring Connections Many Africa economies experienced severe economic crisis in 1970s and early 1980s. A series of external economic shocks, domestic policy mismanagement, political instability and corruption plagued economies and brought them to verge of collapse (World Bank 1981; IMF 1989; Jespersen 1992). The urban areas experienced rapid growth characterized by unemployment and underemployment, and a fall in real income that wiped out colonial legacy of high wage economies (Weeks 1971). In Uganda, for instance, the minimum wage fell to l0 to 15 percent of its 1972 value in 1980s and monthly wage would have brought no more than a week's supply of food (Jamal and Weeks 1993, 37-38). Regrettably, World Bank- and International Monetary Fund-supported structural adjustment programs (SAPs) being implemented in several African countries have paid little attention to problem of urban impoverishment. …