The Covid-19 pandemic and the subsequent lockdown have led to the loss of jobs across the country. According to a recent survey report published by Nepal Rastra Bank (NRB), in the four-month-long lockdown, that started in March, 61 percent of businesses shut down completely and businesses laid off a quarter of their employees. On top of the number of people rendered jobless within the country, migrant workers returning home due to layoffs abroad have also increased the number of people looking for work. However, with the rise in Coronavirus caseloads, work is becoming scarce and there is no certainty that economic activity will return to normal any time soon.
One of the plans the government is banking on to create jobs post-pandemic is Prime Minister’s Employment Programme. Started in the fiscal year 2018-2019, the programme aimed to employ 100,000 registered unemployed people for 30 days. But it came short in reaching its goal and by the end of the fiscal year, a total of 175,909 people got jobs for 13 days on average. Despite the evident failure of the programme, the government of Nepal has doubled its budget this year to NRs 11.6 billion. With the programme’s poor track record, it is doubtful whether it is going to create jobs.
It is evident that jobs created by the government will not be sufficient. Thus perhaps a step in the right direction would be to pursue a broad policy response to make it easier for newer businesses to start. While many existing firms are going to utilize the NRB’s refinance facilities, the government should make it easier for newer firms to sprout post-pandemic. The government can utilize funds allocated to different employment-generating programmes to provide financing facilities to new firms. With migrant returnees expected to throng back to the country, the government of Nepal should relax business registration regulations and incentivise these returnees to start new businesses.