Labor productivity and employment gaps in Sub-Saharan Africa

Abstract

Drawing on a new set of nationally representative, internationally comparable household surveys, this paper provides an overview of key features of structural transformation – labor allocation and labor productivity – in four African economies. New, micro-based measures of sector labor allocation and cross-sector productivity differentials describe the incentives households face when allocating their labor. These measures are similar to national accounts-based measures that are typically used to characterize structural change. However, because agricultural workers supply far fewer hours of labor per year than do workers in other sectors in all of the countries analyzed, productivity gaps shrink by half, on average, when expressed on a per-hour basis. Underlying the productivity gaps that are prominently reflected in national accounts data are large employment gaps, which call into question the productivity gains that laborers can achieve through structural transformation. Furthermore, agriculture’s continued relevance to structural change in Sub-Saharan Africa is highlighted by the strong linkages observed between rural non-farm activities and primary agricultural production.

Agriculture, Food and Jobs in West Africa

“…Another dominant argument is the perceived low labour productivity in agriculture and therefore the absence of productive employment opportunities. However, recent evidence (McCullough, 2017 andChristiaensen andPremand, 2017) suggests that productivity differences between agriculture and secondary and tertiary activities are significantly smaller than usually assumed (rather in the order of 1:2 than 1:6). Also, there is strong heterogeneity in labour productivity within agriculture, demonstrating the potential for increasing intrasectoral productivity under existing agro-ecological conditions.…”

“…There is a growing body of evidence showing large agricultural productivity differences across countries and also within countries. One method of capturing productivity differences and their employment impact is to look at actual hours worked, or full-time equivalents (FTE), 8 instead of declared activity (McCullough, 2017). In the seven countries for which data are available, those in agriculture work significantly fewer hours than those in downstream segments of the food economy.…”

“…Agriculture's low entry barriers, in particular on family farms, and the absence of alternative employment opportunities for this age group should explain the high levels of agricultural participation for active 15 to 19 year olds (McCullough, 2017 …”

Entrepreneurship and the Reallocation of African Farmers

“…The reason according to McCullough (2015) is that there is much underemployment in agriculture, with workers working fewer hours in agriculture than outside. This confirms the 'surplus labour' assumption from Lewis and also made in the underlying analysis of the model in section 3.…”

Notes ouest-africaines

“…De plus en plus de sources confirment l'importance des écarts de productivité agricole entre et au sein des pays. L'un des moyens de mettre en évidence ces écarts et leur incidence sur l'emploi est de prendre en compte le nombre d'heures effectivement travaillées, c'est-à-dire d'estimer l'emploi en équivalents temps plein (ETP) 8 , et non plus seulement en fonction des activités déclarées (McCullough, 2017). Dans les sept pays pour lesquels des données sont disponibles, les employés agricoles déclarent nettement moins d'heures travaillées que ceux exerçant dans les segments aval de l'économie alimentaire.…”