The economic impact of Covid-19 on privately owned businesses: a case study of Jinka Town

Since its outbreak in China in November 2019 and its rapid spread worldwide within a few months, COVID-19 has profoundly impacted the global economy, contributing to multidimensional poverty and an unprecedented crisis globally, with Ethiopia being no exception. This study aims to assess the pandemic’s impact on private firms’ income, employment, and societal livelihoods in Jinka town, Ethiopia. Utilizing both secondary data from scholarly literature and primary data collected through surveys, the study analyzed responses from 193 randomly selected private businesses out of a total of 3492 in the town. The findings reveal significant disruptions in business operations due to decreased demand, movement restrictions, increased transportation costs, limited access to affordable inputs, and reduced orders. The average monthly expenditure of enterprises declined from 17,027.74 Birr before the pandemic to 11,752.20 Birr afterward, a reduction that directly impacted employment, as salaries constitute a major share of private sector expenditures. Similarly, the average income fell from 22, 234.70 Birr to 11,273.54 Birr, resulting in a total income loss of 38,276,370.72 Birr across the sector in Jinka town.