In Ethiopia urban poverty, in comparison to rural poverty and national level poverty, has increased over time. This has necessitated urban poverty reduction as an important area of intervention in urban development and planning. Urban poverty reduction policies and strategies, however, have to be based on needs, capabilities and activities of the urban poor for effective achievements. Policies also need to address the differential situations the poor face in different cities and towns.
The objective of this study is to understand the livelihood situations of the poor in big and small towns, and identify the gaps and linkages between the livelihood requirements of the poor and policies at municipal level. The study was conducted in nine cities and towns of the country, including the capital city. Four of the towns were small towns and five were big or intermediate towns. One poor community was selected from each town as the study area, and a total of five hundred households were randomly selected from all poor communities. A household questionnaire detailing the livelihood of the poor was administered to each participant. A Focus Group Discussion (FGD) was conducted in each community to supplement household level data on different aspects of livelihood. Information was also collected from key informants at municipality and kebele levels regarding policy mix, their achievements and effectiveness. In this study a livelihood framework was used to understand the strategies, assets and activities of the poor.
The study findings indicate that in general the poor are asset-less, although there are some differences and similarities regarding asset possession across towns. Those in the small towns are better endowed with livestock resource and house asset but less endowed with quality of labour force. Asset status common to households in the different groups of towns are labour force availability and neighbourhood associations. Lack of financial assets for all households in different towns was also found to be a common characteristic.
In terms of livelihood, casual/piece work was the dominant form of productive activity for most of the households. This is followed by self business in big towns and by wage employment in the capital city. For those engaged in self business, houses are the main business places indicating the importance of home-based activities. In all towns, businesses are run by owners indicating their lack of capacity to hire workers. Income from the business was low with business showing no signs of prosperity. Gender and education differences were noted along the productive activities though the variations across towns in this regard were minimal. In other words, sources of livelihood across towns were similar. The study finds that social and reproductive activities are carried out side by side with productive activities. These activities are important as they provide support for productive activities and livelihood. Shocks and events are experienced by households. Food shortage, ill health, low income and house eviction were the major shocks faced by households.
The foregoing analysis suggests that the livelihood requirements or interventions to improve household livelihoods include assets building strategies, income-generating activities, vulnerability and coping mechanisms.
In terms of policy, all cities and towns, in light of the national urban development policy, implemented micro and small scale enterprise development, integrated housing programme and provision of the land. These policies and programmes, however, have their own implementation problems. The policies have shown some linkages with the livelihood requirements. In particular, the promotion of small and micro enterprises and the integrated housing programme have the potential of addressing livelihood requirements pertaining to employment and housing needs. On the other hand, a number of pointers indicate that there are gaps between the livelihood requirement and existing policies. These gaps pertain to lack of policies that address the assets of the poor, the vulnerabilities of the poor and the differential status of households in different towns.
As a result, the study notes that policies pertaining to enhancing households’ asset, local economic development, home-based activities, causal activities, housing affordability, urban safety nets and overcoming city level institutional capacity should be key areas for policy intervention that address the livelihood of the poor and reduce urban poverty.