2020 December 2020 December COVID-19 Rapid Response Household Surveys Survey representing Croatian households Timing • Round 1: June 2020 (completed) • Round 2: December 2020 (completed) • Round 3: March 2021 (planned) • Round 4: May 2021 (planned) Sample size • 1500 households • containing 4,288 individuals (3,614 adults and 674 children) Geographic • Representative of rural and urban areas coverage Survey content • Demographic indicators • Pre- and during- COVID-19 (employment, income, savings, opinions, children’s education and health) Similar surveys in • Bulgaria, Romania, Poland other countries • The survey design is also linked to the World Bank global rapid assessment monitoring framework 2 KEY FINDINGS Employment and economic distress By December, the impacts of COVID-19 on employment were still significant. • With the economy reopening, one in four workers still stopped working in December, particularly blue-collar workers. • Even among those who continued working, about 10 percent reduced number of hours worked. • 24 percent of workers reported a reduction in income in December. • Nearly 30 percent of workers reported an overall reduction in income in 2020 compared to 2019. Prevalence of economic distress was as high in December as in June • 80 percent of Croatian households reported to be worried about the current economic situation, particularly poor households and households with no working members. • 35 percent of Croatian households reported deteriorating economic situation compared to the pre- crisis level. The corresponding number was 25% in June. 3 KEY FINDINGS Perception of government’s responses There is an overall agreement on restriction measures in Spring, but less so on a reopening plan. • 54% respondents agreed with the government measures in the Spring 2020 (school closure, quarantine). • Less than half of respondents agreed with the government’s reopening plan. 36% believed it was insufficient. • 42% respondents believed the government’s support to households was inadequate. If schools are to be closed again, parents would need more government support, mostly in the form of cash and equipment for distant learning. • Almost all schools applied sanitation measures, especially handwashing, mask, and social distancing, but did less on rescheduling classes or reducing hours of instruction or recess. • If schools are to be closed again, nearly 25% of parents of school- aged children would prefer cash support. • About 20% of parents would need support in equipment i.e. tablets and internet. • Very few requested childcare support. 4 COVID-19 impacts as of Dec 2020: 1 Opinions on government’s responses 2 Employment 3 Income, Savings, Credits 4 Subjective wellbeing 5 Education 5 COVID-19 impacts as of Dec 2020: 1 Opinions on government’s responses 2 Employment 3 Income, Savings, Credits 4 Subjective wellbeing 5 Education 6 There is an overall agreement of government measures in the Spring 2020 to reduce the coronavirus transmission such as closing schools, closing borders and putting in place quarantines. Overall agreement with the response can be seen across all population groups, however, there are some differences by age/gender /income level. 54% of respondents were supportive. considered reaction too extreme. Men 15% and wealthy people tend to agree more. Considered government response as insufficient . 22% These respondents were more likely to be middle- class, or not working, or with lower education levels. 9% had no reaction 7 But less than half of respondents agreed with government’s reopening plan in Summer 2020. One in every three respondents believed it insufficient. 46% of respondents were supportive. considered reaction too extreme 17% (middle class, and people in households with no working members) Considered government response as 31% insufficient (urban, wealthy, and higher education level) 6% had no reaction 8 Nearly half of respondents thought that the government’s financial support to households was not enough. of respondents were supportive (rural, 36% rich, higher education level, and working people). 4% consider reaction too extreme . Consider government response as insufficient 42% (urban, man, poor, lower education level, and not- working) 18% had no reaction 9 Close to half of respondents agreed with the government’s support to businesses although one in three considered it insufficient. People who are wealthy or have a higher education level tended to agree more. 44% of respondents were supportive (wealthy, higher education level). 7% consider reaction too extreme . consider government response as 36% insufficient. 13% had no reaction 10 COVID-19 impacts as of Dec 2020: 1 Opinions on government’s responses 2 Employment 3 Income, Savings, Credits 4 Subjective wellbeing 5 Education 11 Before the pandemic hit (Feb 2020), about half of the working-age population were employed. People who are male, live in urban areas, with higher education levels or in a high- income bracket were significantly more likely to work. 100% 90% 80% 78% 71% 70% 62% 60% 60% 59% 60% 56% 49% 50% 50% 39% 40% 30% 26% 20% 10% 0% Bottom Middle 40 Top 20 rural urban male female primary secondary tertiary 40 All Income Location Gender Education 12 Pre-crisis job structure was very different across population groups. Poor people were more likely to work in manufacture and construction sectors, while better-off people worked in public administration. Women tended to concentrate in the service sector (trade, hospitality), while men were more likely to work in manufacture and construction, and health and education sectors. 100% 90% 80% 70% 60% 30% 27% 50% 28% 25% 32% 40% 29% 25% 29% 30% 20% 10% 0% Bottom 40 Middle 40 Top 20 rural urban male female All Income Location Gender Agriculture Manufacture, construction Trade, hotel, transport Finance, real estate Public administration Health, education, social services 13 Pre-crisis, 55 percent of workers were blue collar, but wealthier people and urban residents were much more likely to hold a white-collar job. Women were as likely as men to hold a white-collar job. 100% 90% 80% 41% 48% 56% 53% 56% 70% 55% 72% 60% 74% 50% 40% 30% 20% 10% 0% Bottom 40 Middle 40 Top 20 rural urban male female All Income Location Gender White collar Blue collar Other 14 Pre-crisis, more than half of Croatians had a salaried job in private sector. Men were more likely than women to have a salaried job in the private sector. 100% 90% 80% 70% 57% 55% 53% 53% 56% 49% 60% 54% 47% 50% 40% 30% 20% 10% 5% 4% 6% 5% 6% 5% 4% 7% 0% Bottom 40 Middle 40 Top 20 rural urban male female All Income Location Gender Self-employed Salaried (public) Salaried (private) Other 15 Pre-crisis, about one in every three Croatians had either a limited work contract or no contract at all. Women and lower-income workers were more likely to have insecure contract. 100% 4% 6% 9% 7% 9% 9% 16% 13% 90% 18% 20% 22% 19% 80% 22% 26% 22% 70% 28% 60% 50% 40% 30% 20% 10% 0% Bottom 40 Middle 40 Top 20 rural urban male female All Income Location Gender Unlimited contract Limited contract No contract 16 Work stoppages were significant, with stronger effects on lower-income workers. Among those working in December, 95 percent kept the same job as what they had before the crisis. 77 percent of those working in February managed to continue working in December 2020 Percent of workers continuing working by month 100% 85% 84% 75% 77% Feb Apr Sept Oct Dec Nearly one in three poor workers stopped working by December Percent of workers continuing working by month and income 100% 90% 87% 89% 87% 85% 84% 79% 78% 79% 74% 68% 62% 32% lower-income workers stopped working in December Feb Apr Sept Oct Dec Income Bottom 40 Income Middle 40 Income Top 20 Source: Croatia COVID-19 Rapid Response Survey (2020) 17 9 months after the outbreak of COVID-19, blue-collar workers were still more likely to stop working than white- collar workers. However, the gender gaps in work stoppage had disappeared by December. 73 percent of blue-collar workers working in February managed to continue working in December 2020 Percent of workers continuing working by month and occupation 100% 85% 88% 83% 88% 85% 81% 69% 73% Feb Apr Sept Oct Dec white collar blue collar Women were as likely as men to continue to work in December 2020 100% 87% 86% 82% 80% 76% 75% 77% Feb Apr Sept Oct Dec male female Source: Croatia COVID-19 Rapid Response Survey (2020) 18 Croatian economy has been reopened since the summer. But as of December, one in four people who stopped working cited the reason was temporary unemployment. Reasons for work stoppage Sept-Oct Dec 6% 10% Family care Business went bankrupt or temporarily 16% 10% closed due to COVID-19 reasons 11% 13% Health issues Lost job due to less 12% 13% business 23% 23% Temporary unemployed 14% 11% Retirement 19 By December, one in ten workers still had a reduction in working hours. Not only were blue–collar workers more likely to stop working. They were also more likely to report a reduction in working hours. Low-income workers were significantly more likely than high-income workers to suffer a cut in working hours. 100% 4% 7% 10% 9% 12% 90% 16% 80% 70% 60% % work force 50% 40% 30% 20% 10% 0% Bottom 40 Middle 40 Top 20 white collar blue collar All Income Occupation Axis Title Stop working Full Reduced 20 Compared to the same time last year, the number of people absent from work increased dramatically in March and April. But even when the economy reopened in the summer, the number of people absent from work was still higher than same time last year. Number of people absent from work in Croatia in 2020, compared to 2019 600 2019 2020 500 Number of people absent 400 300 200 100 0 Share of employment (as % od Q4, 2019 employed) 40% 2019 2020 % of those employed in Q4 2019 35% 30% 25% 20% 15% 10% 5% 0% 21 Source: Eurostat 2020 Following a cut in work hours, workers experienced a reduction in salary in December, especially among low-income workers and blue-collar workers 40% 37% 35% 30% 27% 25% 25% 24% 23% 21% 21% % workers 20% 19% 15% 10% 5% 0% Bottom 40 Middle 40 Top 20 male female white collar blue collar All Income Gender Occupation 22 Croatian workers, in particular lower-income and blue-collar workers, reported a reduction in overall income in 2020 compared to 2019. 40% 36% 35% 35% 30% 30% 29% 29% 27% 25% 25% 24% % workers 20% 15% 10% 5% 0% all Bottom 40 Middle 40 Top 20 male female white collar blue collar All Income Gender Occupation 23 COVID-19 impacts as of Dec 2020: 1 Opinions on government’s responses 2 Employment 3 Income, Savings, Credits 4 Subjective wellbeing 5 Education 24 The Government’s emergency response to the COVID-19 crisis has helped temper the impact on the labor market. Tax measure (direct and indirect) Employment related • Payment deferrals measures • Reduced VAT • Grant to support reduced working hours • Grant for the preservation of jobs for people with disabilities • Job preservation grant for affected sectors Other economic stimulus measure • Financial liquidity • COVID-19 loans World Bank support • Crisis Response and Recovery Development Policy Financing ($300 million) • Earthquake Recovery and Public Health Preparedness Project ($200 million) 25 Many respondents reported receiving unemployment benefits and COVID-19 employment support from the government. Nearly 40 percent of unemployed workers received unemployment benefits in December; and 20 percent of workers received support from the government. 40% 35% 30% % people qualified 25% 20% 15% 10% 5% 0% Employment benefits Unemployment benefits On average, beneficiaries received support for 4 months since the outbreak of the pandemic. 5 4 4 Number of months 3 3 2 2 1 1 0 Employment benefits Unemployment benefits 26 Household income still declined across the board. By December, one in five households reported so. Reported decline in income by household type (% households) Employment working no working urban Location rural Top 20 Income Middle 40 Bottom 40 All all 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% % households Decrease >40% Decrease 20-40% Decrease <20% Same Increase Don't know 22% of households reported drop in income. The wealthiest, urban households, and households with at least one working member were more likely to experience income reduction. However, the gender of the household head does not play a significant role in household income reduction. 27 Consistently, a third of Croatian households saw their bank account balance in December decrease compared to their pre-crisis balance, especially among poor households and households with at least one working member. 100% 90% 29% 25% 28% 27% 31% 32% 31% 31% 37% 35% 80% 70% % respondents 60% 50% 40% 30% 20% 10% 0% Bottom 40 Middle 40 Top 20 rural urban male female no working working All Income Location Gender Employment Not decrease Decrease 28 Moreover, nearly 80 percent of Croatian households had inadequate savings to weather the second wave of the COVID-19 crisis. The situation is more challenging for poor or rural households. 100% 90% 80% 70% 60% 50% 87% 40% 70% 74% 72% 71% 70% 68% 68% 68% 30% 20% 43% 10% 0% Bottom 40 Middle 40 Top 20 rural urban male female no working working All Income Location Gender Employment No saving savings running out within 6 months adequate savings 29 On average, 6 percent of Croatian households fell behind in mortgage payments by the end of 2020. Poor households, households headed by males, and households with at least one working member were more likely to have mortgage debts. Mortgage 10% 9% 9% 8% 8% 7% 7% 6% 6% 6% 6% 6% % households 5% 5% 4% 4% 3% 2% 2% 1% 0% Bottom 40 Middle 40 Top 20 rural urban male female no working working All Income Location Gender Employment 30 Nearly 15 percent of Croatian households were not able to pay their utility bills in December. This corresponding figure is 23 percent among poor households. The same pattern is observed when we consider payments of credits and phones. 25% 20% 15% % households 10% 5% 0% Bottom Middle 40 Top 20 rural urban male female no working 40 working All Income Location Gender Employment Utility Credit Phone 31 COVID-19 impacts as of Dec 2020: 1 Opinions on government’s responses 2 Employment 3 Income, Savings, Credits 4 Subjective wellbeing 5 Education 32 There were more households facing difficulty to make ends meet in December than in June. Difficulty to make ends meet Top 20 Middle 40 June Bottom 40 All Top 20 December Middle 40 Bottom 40 All 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% % households Great difficulty Difficulty 65% of all households reported difficulties with their current income level to pay for their needs in December compared to 50% in June. Poor households suffered the most. So did rural households, or households with no working members. But female-headed households did not appear to face more difficulties than male-headed households. 33 By now, nearly 35% Croatian households reported deteriorating economic situation compared to the pre-crisis level. The corresponding number was 25% in June. More difficult to make ends meet compared to February 45% 40% 35% 30% % households 25% 20% 15% 10% 5% 0% All Bottom 40 Middle 40 Top 20 December June Poor households suffered the most. But there are no significant differences across population groups (gender, location, employment status) 34 The level of economic stress reported due to the COVID-19 pandemic was as high in December as in June. June Dec 20% 24% Strongly agree 61% 59% Agree 14% 12% Disagree 3% 2% Strongly disagree 2% 3% Don’t know 35 But economic stress varies across the population. Poor households, households headed by a woman, and households with no working members were more likely to be stressed about their economic situation. 100% 90% 80% 70% 60% % households 50% 40% 30% 20% 10% 0% Bottom Middle Top 20 rural urban male female no working 40 40 working All Income Location Gender Employment Strongly agree Agree 36 When considering other types of stresses, the same pattern is recorded. Poor, rural households, households headed by a woman, and households without a working member were more likely to be stressed. 70% 60% 50% % households 40% 30% 20% 10% 0% female female urban urban bot40 top20 bot40 top20 no working no working working working mid20 mid20 national national male male rural rural All Income Location Gender Employment All Income Location Gender Employment Overall situation Leaving home Strong agree Agree 37 COVID-19 impacts as of Dec 2020: 1 Opinions on government’s responses 2 Employment 3 Income, Savings, Credits 4 Subjective wellbeing 5 Education 38 By December, most students had access to at least one type of device, readily for distant learning, although children in low-income family, or in rural areas, or in households will no working member had more limited access. 100% 90% 80% 70% % school-aged children 60% 50% 40% 30% 20% 10% 0% Middle 40 rural high school female elementary Bottom 40 urban male working Top 20 not working All Income Location Gender School Employment 39 But only half of school-aged children had access to high-quality devices such as tablet and computer. Children in elementary school, children from poor households, or households headed by a woman were less likely to have access to a computer. 90% 80% 70% 60% % school-aged children 50% 40% 30% 20% 10% 0% middle 20 all rural high school female elementary urban male working top 20 bottom 40 not working All Income Location Gender School Employment Tablet Computer 40 When school reopened, most schools applied sanitation measures such as hand washing, disinfecting, mask wearing, social distancing, and access prohibition to outsiders. Fewer schools rescheduled classes to reduce exposure and measured temperature at entrance. 100% 96% 95% 92% 90% 90% 87% 83% 80% 80% 74% 70% 60% 50% 40% 30% 20% 10% 0% 41 Interestingly, rural schools and schools where children from poor family attended were more likely to apply sanitation measures. Elementary schools were more likely to require handwashing, daily temperature measurement and social distancing, while high schools were more likely to require masks. 100% 90% 80% 70% % school-aged children 60% 50% 40% 30% 20% 10% 0% All Bottom 40 Middle 40 Top 20 rural urban elementary high school All Income Location School Handwash Mask Temperature Social Distancing 42 If schools are to be closed again, parents would need support from the government. Nearly 25% of parents of school-aged children preferred cash support. Very few parents needed childcare support. all 25% 23% 20% 19% 18% % school-aged children 15% 11% 10% 9% 5% 1% 0% Internet Tablet Paid leave Food Cash Childcare 43 If online or distant learning is reintroduced, children in rural areas, from poor households, and from households with no working members were more likely to need government support for internet access and acquisition of tablets. 30% 25% 20% 15% 10% 5% 0% all high school rural female Middle 40 elementary urban Bottom 40 male working Top 20 not working All Income Location Gender School Employment Internet Tablet 44 But parents of young kids, parents from middle- class, and fathers were more likely to ask for paid leave to take care of the children when schools are closed. 18% 16% 14% 12% 10% 8% 6% 4% 2% 0% Middle 40 high school rural female elementary Bottom 40 urban male Top 20 All Income Location Gender School 45 Fathers, parents in rural areas, parents from poor households, parents from households with no working members tend to need cash or food support. 40% 35% 30% 25% 20% 15% 10% 5% 0% high school rural female Middle 40 elementary urban Bottom 40 male working Top 20 not working All Income Location Gender School Employment Food Cash 46 47