Understanding the Impacts of COVID-19 on Rural Households in Kenya

Pulse 21

Published on

February 3, 2021

In March 2020 we set out to assess how the COVID-19 pandemic would impact different types of rural households, and shared these projections over several months through our COVID-19 Emergency Briefing Series. By December 2020 we were able to bring those projections to bear with data and real stories from the field that painted a picture of the actual impacts of COVID-19 on rural households in Kenya.

Download our latest learning brief for the full insightsor keep reading for a summary of key learnings.

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When COVID-19 reached Kenya in mid-March 2020, the national government moved quickly to contain the spread of the disease by restricting travel, closing schools and essential businesses, and implementing a curfew. As has been the case in so many countries, these restrictions were successful at slowing transmission of the virus but also contributed to severe economic impacts. As one farmer put it: “We now can’t go to the market due to social distancing...and most people don’t have the money to hire labourers.” A drop in demand for many goods and services—as well as supply chain disruptions due to limitations on movement—have hit many sectors hard, including the rural economy.  

But not every rural household has been impacted in the same way. Rural households in Kenya are diverse and dynamic in their livelihoods strategies, ranging from smallholder farming to rural entrepreneurship. Thus, the impacts of COVID-19 and the coping mechanisms they have turned to in response vary across different livelihoods. Building on the recent Pathways to Prosperity report, we’ve applied a rural pathways lens to better understand how the COVID-19 crisis is affecting different types of rural households in Kenya, how they are coping, what types of tailored support they will need to recover, and how COVID-19 might impact Kenya’s broader rural transformation trajectory. 

Rural Pathways Model

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Financial impacts of COVID-19 on rural households

For all four pathways that we examined (1, 2, 4, and 5), the pandemic has been a significant financial shock. Households that rely primarily on farming (Pathways 1 and 2) reported both lower demand and lower prices for their produce. Subsistence-level farmers (Pathway 1)—who usually supplement their income with hard-hit informal labor, micro businesses, or remittances—have been impacted particularly strongly, with 92% reporting lower incomes. Many have increased consumption of their own farm produce, leaving less to sell on local markets. More commercialized farmers (Pathway 2), while also experiencing severe economic impacts, appear to be more resilient than both subsistence farmers and rural entrepreneurs (Pathway 5). Generating most of their income from their farm, they have been relatively less affected by government restrictions. Up to 15% of these households have even benefited from the crisis through higher prices or increased sales in commercialized value chains.

How COVID-19 affects rural households

For households that operate more established agribusinesses for their livelihoods (Pathway 4), COVID-19 has also caused severe disruption—though these households may be better able to cope with financial shock due to their relatively higher, more stable incomes. Still, 95% of households running an agribusiness (Pathway 4) and 97% of those running micro- and small enterprises in retail, leisure, or rural services (Pathway 5) report reduced incomes. For agribusiness households, reduced consumer demand and increased prices for farm inputs are both contributing factors. Impacts on rural entrepreneurs, on the other hand, varied in severity depending on whether the government deemed their services “essential” and allowed them to continue operating during the lockdown. Importantly, women-run enterprises are most likely to experience severe financial impacts given their higher presence in “non-essential” sectors such as beauty salons, hotels or catering. 

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Household coping mechanisms and support needs

Unfortunately, the most common coping mechanism in response to these impacts has been to reduce household food consumption. With the lowest levels of income and resilience, Pathway 1 households are most at risk of food insecurity: nearly half of these households reported they are consuming less food because of the pandemic. Non-farming households in Pathways 4 and 5 are similarly unable to rely on their own farms for food; thus, around 40% of these households reported reductions in food consumption during the first four months of the crisis. Across all pathways, female-headed households are more vulnerable to food insecurity—in Pathways 1, 4, and 5, they were 75% more likely to report decreased food consumption compared to male-headed households.

In addition, nearly one-third of households across all pathways reported drawing on their savings to cope with the impacts of the pandemic. A number of households also reported borrowing money: 20% of Pathway 4 households have done so, compared to 14% of Pathway 1 households and just over 11% of households in Pathways 2 and 5. In part, the higher percentage of Pathway 4 households may be a result of their greater connection to the formal financial system and ability to benefit from government relief measures. Finally, up to 10% of Pathway 4 households reported reducing investments in their farm or business during the pandemic which may yet have longer-term impacts on rural economies.

Our research shows that households across all pathways are looking for support to cope with the impacts of the COVID-19 crisis; however, like the impacts themselves, the types of support requested vary across households. While 64% requested financial support, this was most prevalent in Pathways 4 and 5. On the other hand, Pathway 1 households were disproportionately more likely to request food aid. These variations are further evidence that relief should be tailored to different household needs and livelihoods strategies using a rural pathways lens. 

Top coping mechanisms by pathway

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Long-term implications for rural economies

The impacts above point to an array of possible cascading effects of the COVID-19 crisis. These include decreasing financial resilience across all pathways as households deplete their savings; a worsening gender gap, as unpaid care responsibilities increase for women; declining employment opportunities for youth, as agricultural enterprises slow their growth; and a sharp decline in private sector-led rural service provision, as a cash crunch pushes these players out of the market. Emerging new variants of COVID-19 may prolong the crisis and surface these knock-on impacts sooner than expected.

But perhaps more importantly, the COVID-19 pandemic may reshape rural pathways and economies altogether. In the face of financial shocks, rural households may redistribute across the livelihoods pathways. Households may slide backward into deeper poverty. Commercializing households, unable to invest in their farms during the pandemic, may face stagnant growth for years to come. More households across all pathways may choose to migrate if hiring freezes continue. All of these possibilities would lead to significant demographic shifts within and between pathways, and a declining rural economy with radically different service and policy needs.

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How can we ensure rural households aren’t left behind?

There are a number of considerations we should be accounting for as a sector as we tackle the complexity of the COVID-19 crisis in rural communities. This includes continuing to apply a pathways lens in order to understand how the crisis is impacting different rural clients and to design tailored interventions; applying a gender lens to all interventions to understand the unique challenges women face and investing in building their resilience to future shocks; and examining the mid- and long-term impacts of the COVID-19 pandemic on rural households, markets, and economies—in particular, we must deepen our understanding of the speed, shape, and drivers of the recovery. We also need to connect the reality of what rural households are experiencing on the micro level—in Kenya and other countries—to the macro level agenda of rural transformation. This means responding to the immediate crisis to support rural households, but also asking the harder questions about what the rural economy should ideally look like. The COVID-19 pandemic has reshaped the world in challenging ways—but it is also an opportunity to reshape our vision for inclusive rural development for generations to come.

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The Learning Lab works to identify and share knowledge relevant to our learning agenda and our users, but also to create new knowledge through research and facilitated learning. Original content from the Learning Lab includes news about the Lab, analyses we've conducted, knowledge products we've created, and posts we've written about other relevant initiatives.

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Shell Foundation (SF) is a UK-registered charity, founded by Shell in 2000, that creates and scales business solutions to enhance access to energy and affordable transport. SF exists to serve the low-income communities most affected by these issues. They provide patient support to social enterprises and institutions capable of delivering social change at scale across Africa and Asia via disruptive technologies or business models without long-term reliance on charitable support or subsidy.

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