Harnessing the Development Potential of Household Enterprises in the COVID-19 Environment in Uganda

Abstract

Household enterprises have received limited policy attention in Uganda despite playing a crucial role in providing family employment and serving as a catalyst for poverty reduction. This Policy Note utilises the most recent Uganda National Household Survey 2019/20—collected prior to and after the COVID-19 pandemic disruptions to understand the early effects of Covid-19 on household enterprises. We show that the share of households with enterprises decreased by about 7% during the Covid-19 period—equivalent to an estimated 200,000 households. Western Uganda registered the most significant decrease, followed by Northern Uganda. With sales and revenues, the share of household enterprises reporting decreased sales/revenues almost doubled during the Covid-19 period compared to before Covid-19. We also show that the business environment worsens during Covid-19 especially obtaining start-up capital for female-owned HEs. Other constraints during the pandemic included finding clients/markets and accessing raw materials to a limited extent. Furthermore, the government’s COVID-19 containment measures negatively affected those enterprises operated away from home. Female owned businesses dominate the HEs sector. This could be an avenue or entry point for interventions targeting women empowerment. The policies can explore women empowerment by identifying and targeting the growth and development of HEs run by women or generally in communities.