Status and determinants of poverty among women-owned micro-businesses in Wolaita zone, southern Ethiopia

Abstract

Micro-businesses contribute to economic development by improving individual welfare. Women are the primary drivers and owners of such businesses in urban Ethiopia. The purpose of this study is to investigate the poverty status and determinants among women-owned micro-businesses. The basic study units were women who owned micro-businesses. A sample of 384 women-owned micro-business was chosen using a stratified and systematic random sampling technique. Thirty-six participants were purposely chosen for in-depth interviews and focus group discussions. Questionnaires, in-depth interviews and focus group discussions were used to collect data. The poverty head count, poverty gap and poverty severity indices were computed to estimate poverty status. The major determinants of women’s poverty were investigated using a logistic regression model. The overall poverty incidence, gap and severity were estimated to be 24.27%, 3.85%, and 1.11% respectively, among the women who owned micro-businesses. Eight of the 14 poverty determinants, including age, dependents, savings, remittance and the number of days and hours women work in their businesses, were found to have a significant effect on women’s poverty. The results suggest that local governments, technical and vocational training institutions should work together to reduce the impact of poverty-aggravating factors on women and increase the contribution of women-owned micro-businesses to poverty reduction. This study addressed the poverty status of women who run micro-businesses, which is a crucial issue in Ethiopia’s urban context. It adds new knowledge to the issue of gendered economic participation, poverty reduction and poverty determinants in the Ethiopian context.