Africa's Got Work to Do: Employment Prospects in the New Century

Fox, Louise; Haines, Cleary; Munoz, Jorge Huerta; Thomas, Alun

doi:10.2139/ssrn.2346251

Cited by 16 publications

(2 citation statements)

References 3 publications

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“…McMillan and Zeufack (2022) conduct the same exercise for 10 additional countries and find similar patterns for the low-income African countries. This dominant role of the informal sector in employment is also reflected in household-level data (Fox et al 2013).…”

Section: Explaining Patterns Of Growth: Manufacturing Employment Trendsmentioning

confidence: 82%

Africa’s Manufacturing Puzzle: Evidence from Tanzanian and Ethiopian Firms

Diao

Ellis²,

McMillan

et al. 2022

Preprint

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Recent growth accelerations in Africa are characterized by declining shares of the labor force employed in agriculture, increasing labor productivity in agriculture, and declining labor productivity in modern sectors such as manufacturing. To shed light on this puzzle, we disaggregate firms in the manufacturing sector by average size using two newly created firm-level panels covering Tanzania (2008-2016) and Ethiopia (1996-2017). We identify a dichotomy between larger firms with superior productivity performance that do not expand employment and small firms that absorb employment but do not experience much productivity growth. Large, more productive firms use highly capital-intensive techniques, in line with global technology trends. JEL Classification O14, O47

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Section: Explaining Patterns Of Growth: Manufacturing Employment Trendsmentioning

confidence: 82%

Africa’s Manufacturing Puzzle: Evidence from Tanzanian and Ethiopian Firms

Diao

Ellis²,

McMillan

et al. 2022

Preprint

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“…The next step is to show how the different sectors of the economy are likely to develop given the overall growth rates identified above. Figure 2.4 shows how the structure of output changed in the six countries between 2000 and 2010 and projects the composition of output by sector for 2065 based on the current trajectory as per the methodology applied by Fox et al (2013). In all countries, the contribution of agriculture is projected to decline while that of services and industry increases.…”

Section: Slow Structural Change and The Implications For Employmentmentioning

confidence: 99%

Social Protection in East Africa

2017

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Inclusive Dualism

Nattrass¹,

Seekings²

2019

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W. Arthur Lewis, the founding father of development economics, saw developing economies as dualist, that is, characterised by differences in earnings and productivity between and within economic sectors. His famous model of development, in which ‘surplus’ (unemployed and underemployed) labour was drawn out of subsistence activities and into manufacturing, was reflected in the subsequent East Asian development trajectory in which labour was drawn into low-wage, labour-intensive manufacturing, including in clothing production, before shifting into higher-wage work once the supply of surplus labour had dried up. This development strategy has become unfashionable, the concern being that in a globalized world, labour-intensive industry promises little more than an impoverishing ‘race to the bottom’. A strong strand in contemporary development discourse favours the promotion of decent work irrespective of whether surplus labour exists or not. We argue that ‘better work’ policies to ensure health and safety, minimum wages and worker representation are important. Decent work fundamentalism—that is, the promotion of higher wages and labour productivity at the cost of lower-wage job destruction—is a utopian vision with dystopic consequences for countries with high open unemployment, including most of Southern Africa. We show, using the South African clothing industry as a case study, that decent work fundamentalism ignores the benefits of dualism (the co-existence of high- and low-wage firms), resulting in the unnecessary destruction of labour-intensive jobs and the bifurcation of society into highly-paid, high-productivity insiders and unemployed outsiders. The South African case has broader relevance because of the growth in surplus labour—including in its extreme form, open unemployment—across a growing number of African countries. Inclusive dualism, as a development strategy, takes the trade-off between wages and employment seriously, prioritizes labour-intensive job creation and facilitates increased productivity where appropriate, so that jobs are created, not destroyed.

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Africa's Got Work to Do: Employment Prospects in the New Century

Cited by 16 publications

References 3 publications

Africa’s Manufacturing Puzzle: Evidence from Tanzanian and Ethiopian Firms

Africa’s Manufacturing Puzzle: Evidence from Tanzanian and Ethiopian Firms

Social Protection in East Africa

Inclusive Dualism

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