Household Welfare Monitoring in the Lao PDR

New: Round 8 Survey

The World Bank in the Lao PDR began a series of Rapid Monitoring Phone Surveys in 2020 to monitor the social and economic impacts of COVID-19 on Lao households. Following the end of the pandemic, surveys continue so that data is available for the ongoing economic challenges.

Hopes of a rapid economic recovery after the pandemic have been dimmed by internal and external factors that threaten household living standards. Domestically, currency depreciation and high inflation, resulting from high levels of external debt and low foreign exchange reserves, have led to rising prices, particularly for imported fuel, food, and medicine. The Lao kip depreciated by 23% against the US dollar between January 2023 and February 2024, feeding high inflation, which stood at 25% in February 2024.

While economic activities have picked up, rising living costs are having widespread effects, and these ongoing surveys provide insights into the distribution of the impact on Lao families. The first survey was conducted from June to July 2020, when Laos had just exited the first nationwide COVID-19 lockdown. The second round was conducted from February-March 2021, one year into the pandemic. A third round followed from April to May 2021, early in the second lockdown, and a fourth survey carried out October to November 2021, as lockdown measures began to ease. The fifth round occurred April-May 2022, the sixth December to January 2023, and the seventh in May to June 2023. The eight and latest survey ran from January 21 to February 20, 2024.

This webpage provides links to the results of all survey rounds, plus a report on public service delivery and citizen expectations from the government response to COVID-19, drawing mainly on results from the second survey round. Round 6 was accompanied by a qualitative survey, conducted in late 2022 to provide a better understanding of how rural people perceived the economic and social impacts of both the COVID-19 pandemic and the deteriorating economic situation, particularly spiraling inflation.

The survey questionnaire is designed to cover themes such as access to staple foods, food insecurity, employment, the impact of inflation on households, family businesses and farms, economic activities and income, coping mechanisms, and access to social assistance. The results of further rounds of the survey will be published as they become available.

Last Updated: Apr 08, 2024

Latest Key Results

• Macroeconomic instability has persisted. Inflation has stabilized but remains high. The protracted period of high inflation has changed the labor market landscape, affected household living standards, and undermined human capital development.
• Employment continued to expand in the second half of 2023. Workers shifted from services, which were most affected by kip depreciation and high inflation, toward agriculture and manufacturing.
• Wage growth accelerated in the second half of 2023 but was not sufficient to compensate for inflation. Wage employment and unpaid family work declined, while the number of self-employed workers increased.
• Family business activities increased, providing income sources that could keep up with inflation. Average profit rose by 22% over 2023, almost keeping pace with the inflation rate of 24%. However, nearly 40% of businesses did not see profits increase, implying that their real incomes declined.
• Agricultural businesses outperformed non-farm businesses. About half of crop-producing households grew crops for sale. Cassava was a major cash crop for 33% of crop producers.
• Growth in per capita household income accelerated in the second half of 2023, increasing by 25% over the year. However, over 40% of households saw their income lag behind inflation.
• In the second half of 2023, the proportion of households that felt significant impact from inflation increased, but declined among high-income households. 
• Scaling up own-food production and switching to cheaper food remain the most common strategies for coping with food inflation. However, more households are engaging in additional income-generating activities and taking loans.
• Many low-income households continue to reduce food consumption to cope with price increases, underscoring their vulnerability to persistent high food inflation. Only 10% of these households reported receiving government assistance to help them cope.
• 34% of high-income households report reducing education spending, compared to 45% of low-income households. Persistent inflation is expected to widen the human capital gap across income groups.
• School dropout rates remain high at 5%, with boys from low-income households having higher instances of dropout. Financial reasons — inability to pay for school or the need for children to work and support the family — are the primary cause.
• Food security improved among rural and low-income families between December 2022 and January 2024, but not among urban and high-income families.
• Respondents report increasing difficulty in accessing government administrative services. More than half of households cited high inflation and kip depreciation as the most pressing issues for the government to address.

Last Updated: Apr 08, 2024