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Media Statement : South India to face the least disruption from COVID-19 lockdown, says ISB study

Media Statement : South India to face the least disruption from COVID-19 lockdown, says ISB study

A new study assesses the economic impact of the government-enforced lockdown across occupations, industries, workers and policy


April 8, 2020: With a government-imposed lockdown in place to tackle with the COVID-19 pandemic, most professionals are relegated to work from home. To study and understand the situation, the Indian School of Business (ISB) has initiated new research to find out how this lockdown affects occupations, industries and the different districts of India. And finally, but most importantly, to assesses the potential economic impacts of this virus-induced lockdown.

This research uses a 2019 survey of 3,000 workers to measure the impact of the lockdown on over 100 occupations as defined in the National Classification of Occupations (NCO) of the Ministry of Labour and Employment, and assigned a Work from Home Index (WFI) to each occupation. A ‘Human Proximity Index’ (PI) is also assigned to each one of these occupations. With these two indices lined up perpendicular to each other, the occupations were classified into four quadrants -- low work from home and high human proximity, low work from home and low human proximity, high work from home and high human proximity and high work from home and low human proximity.

For the WFI, a survey comprising of six questions was developed by the researchers to assess if physical proximity, on-site presence or working with teams were vital to do the job. The researchers found that the two indices had a significant negative correlation with each other. The results were reasonably intuitive, like in the cases of drivers, housemaids, nurses, etc. displayed low work from home potential. 

While classifying sectors, computer programming along with some others were found to have high work from home potential. In contrast, those like agriculture, wholesale or retail trade and collaborative manufacturing had a lower potential for work from home. A few sectors, like textiles and occupations like restaurant services, were found to have little human proximity and low potential for work from home by the study.

Some unintuitive findings also came from the study. Most jobs which have a high work from home potential and high human proximity, for example, middle school teaching associates, were found to be highly susceptible to automation, owing to their high work from home potential. 

“Though we see very few occupations in this quadrant, this might well be the time when a lot of occupations move to this quadrant of high work from home potential and high human proximity,” said Professor Deepa Mani, co-researcher of this study and Executive Director of the ISB research centre Srini Raju Centre for IT and the Networked Economy (SRITNE).

The two indices (WFI and PI) were mapped, district-wise and industry-wise, to determine the impact of the current lockdown. In this district-level measure, researchers find that cities had a higher potential for work from home, with many services based from here. Also, some urban districts were found more amenable to work from home. 

“Surprisingly, not just urban centres like Hyderabad, Delhi or Bangalore fell high on the WFI, but the entire peninsular south India, was found to have a high work from home potential,” said Professor Shekhar Tomar, faculty in the Economics and Public Policy area at ISB and co-researcher of this study. 

Using these two indices, a third measure – to determine the economic impact of this WFH disruption – is arrived at by the researchers. To do this, a ratio of the WFI and PI are used. A significant spatial variation was noted when mapping the Disruption Index (DI) to the districts of India. The result indicated that South India (higher on WFI and low on PI) should face more moderate disruption compared to the potentially higher disruption likely to be witnessed across north India.

This study also found interesting variations within a district. In the case of Delhi, northeast Delhi was found to be facing much higher disruption compared to south Delhi. The ISB faculty explains that the variations were for the fact that northeast Delhi has a lot more labour-intensive manufacturing. At the same time, south Delhi was mostly populated by those in the services sector. “Given this spatial distribution in impact across occupations and geographies, designing a policy for sectors that involve more human proximity, is of utmost importance for the government,” said Professor Tomar, highlighting that this disruption index could be used to determine level of fiscal support for different sectors and professions.

The researchers said that sectors which are more prone to working from home maybe could be provided with a policy nudge, like tax breaks, by the government using the disruption index. Based on this study, organisations might need to design effective policies, practices and initiatives that assist or complement WFH. “The second less obvious implication was the need to assess the susceptibility of occupations to digitisation,” said Prof. Mani, discussing the implications of this study.

To buttress this point, the researchers cite examples of organisations like Byju’s and ISB who had already put a lot of their digital transformation initiatives on the fast lane because of the COVID-19 crisis. “I think we are going to see new digital models which will come in and alter consumer behaviour. Firms must, therefore, watch for these new digital business models,” advised Prof. Mani.

The study is still assessing the impact on workers across various dimensions like psychological impact, productivity and wellbeing. To evaluate this, the ISB faculty has designed a survey and has invited participation from more professionals across India.

Survey (link: findings will be shared soon.



About SRITNE: The Srini Raju Centre for IT and Networked Economy is the first research centre of ISB which is dedicated to conducting multi-disciplinary research for a better understanding of the digital economy. SRITNE works on path leading research projects across several aspects in the intersection of technology impact on business and society. SRITNE actively works on research projects from Government of India, state governments, leading corporates and global universities and research institutions. SRITNE provides custom training programmes for executives and conducts regular courses on digital and business transformation.

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About ISB: Indian School of Business (ISB) is a global business school offering world-class management education across its two campuses – Hyderabad and Mohali. The School has grown at a rapid pace over the past eighteen years since its inception and already has several notable accomplishments to its credit – it is the youngest school ever to consistently rank among the top Global MBA programmes, one among the select 100 global b-schools to have AACSB and EQUIS accreditation, one of the largest providers of Executive Education in Asia, and the most research-productive Indian management institution. A vibrant pool of research-oriented resident faculty, strong academic associations with leading global b-schools and the backing of an influential Board, have helped the ISB fast emerge as a premier global business school in the emerging markets.

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