The Evolution of Labor Supply and Unemployment in the Egyptian Economy

Abstract

This paper analyzes the evolution of labor supply and unemployment in Egypt in the period from 1999 to 2012, focusing on the impact of the demographic phenomenon known as the youth bulge and the impact of the world financial crisis and the marked economic slowdown following the January 25th 2011 revolution. Data from the Egypt Labor Market Panel Survey of 2012 is used and compared to previous survey rounds. Trends in population, the labor force, employment, and unemployment are investigated and examined by age and education. Even though demographic pressures on the labor market have decreased since 2006 as the youth bulge generation has already made its way into the labor market, employment rates have decreased, labor force participation among women has decreased, unemployment has slightly increased, and underemployment has increased substantially. Overall, the labor market post-revolution is in a weaker position than in 2006.JEL Classifications: J00, J21, J64, J11

Exploring the fertility trend in Egypt

“…The next reason is that underemployment has increased substantially (Assaad and Krafft 2013). The increase in employment in the private sector has not matched the loss of employment in the public sector, and most economic opportunities come from the informal sector, which is dominated by low-quality work and lack of protections and benefits (Assaad and Krafft 2015;Krafft 2016).…”

“…The informal sector has become the norm, especially after the economic crisis was reinforced by the Arab Spring (World Bank 2014). In this context, Assaad and Krafft (2013) show that the impact of …”

“…For women, a drop in labour demand often results in overall reductions in participation rather than simply in increases in unemployment, and this is particularly the case for educated women (Assaad and Krafft 2013). While these phenomena should increase the number of people existing in a precarious situation and could thus affect fertility negatively, as happened in Europe after the 2008 financial and economic crisis (Sobotka, Skirbekk, and Philipov 2011), the opposite has happened in Egypt.…”

Introducing the Tunisia Labor Market Panel Survey 2014

“…Similar to its Egyptian and Jordanian counterparts, the TLMPS 2014 is a nationally representative survey that features detailed information on households and individuals, especially in regard to labor market characteristics. As in other countries in the MENA region, Tunisia suffers from high unemployment, particularly for university graduates, youth, and women, and from low female labor force participation (Haouas et al 2012;World Bank 2014;Assaad et al 2016a). The survey allows for an in-depth investigation of current employment characteristics as well as analyses of broader labor market dynamics.…”

Is There an Informal Employment Wage Penalty in Egypt?

“…The labor force participation rate was 23.1 percent for females and 80.2 percent for males in 2012 (Assaad and Krafft, 2013).…”