10 - Consequences of the COVID-19 Pandemic on Human Capital Development

Summary

Abstract

An outbreak the size of the COVID-19 pandemic would surely significantly impact not only the economy but also human capital development. In Indonesia, however, the true size of this pandemic and its human capital impact is unclear since the number of COVID-19 tests has been low. In this chapter we attempt to estimate the true magnitude of the pandemic and outline a conceptual framework to understand channels from which the COVID-19 pandemic will affect human capital development, particularly in health and education, in Indonesia. We find that the number of casualties due to the pandemic could be much larger than those formally announced. The pandemic is expected to increase cases of other morbidities, maternal deaths, and less healthy babies and children. In the long run, there is evidence that a pandemic of this size could increase overall mortality cases.

Introduction

By mid-October 2020, there were around 349,000 formally confirmed cases of COVID-19 in Indonesia and the number of confirmed casualties was approximately 12,000. The pandemic has been spreading to all provinces and the numbers are increasing. Figure 10.1 shows the regional spread of COVID-19 by mid-October 2020. Most confirmed cases are in Java and the Bali Islands. This is understandable since about 58 per cent of Indonesians live in Java and the Bali Islands. Approximately 22 per cent of Indonesians live in Sumatra, but only 15 per cent of cases are on that island. It is predicted, hence, the spread of the pandemic in Sumatra is smaller than the spread of the pandemic in Java and the Bali Islands.

The spread of the pandemic in remote areas of Indonesia, Sulawesi and eastern Indonesia has been relatively equal to the proportion of the population in those areas. However, the number of cases in Sulawesi and eastern Indonesia has increased since July 2020. Hence there are indications that the speed of the pandemic spread in these areas was faster than in other parts of Indonesia between July and October this year. Health facilities and public health programs have been typically weaker outside Java and the Bali Islands, so there is a significant possibility that the pandemic might stay much longer in remote areas of Sulawesi and eastern Indonesia.