ERF’S WORK ON MENA LABOR MARKETS SINCE ITS INCEPTIONRagui AssaadUniversity of Minnesota and ERF

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Towards a New Development Agenda for the Middle EastERF 22nd Annual Conference

March 19-21, 2016, Cairo, Egypt

Introduction• Labor and Human Resource Development has been a

central theme of ERF’s work since ERF’s inception in 1993• One of the three papers defining ERF’s research agenda in the

founding conference was on this theme• Has been one of the parallel session themes in all the annual

conferences• Was one of the thematic areas under the Research Initiative for

Arab Development (RIAD) from 2008-2013• Was one of the thematic areas under the Arab Spring Development

Initiative (ASDI) the successor to RIAD from 2014 until now.

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Challenges Identified at Outset• Severe scarcity of microdata on the region, an essential

input to conducting world class labor research

• Weakness of the capacity of researchers to conduct cutting edge research

• Very little published work despite obvious unemployment and labor market rigidity problems

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Three-Pronged AgendaI. Provide much greater access to high quality microdata

on labor markets and other human development topics

II. Build researcher capacity in labor economics, applied micro-econometrics and policy analysis

III. Substantially increase the quality and volume of research on issues relating to labor markets and human resource development

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I. Access to High Quality Data• Design, implement Labor Market Panel Surveys in

cooperation with National Statistical Offices (NSOs) and make the data publicly available to researchers• ERF Labor Market Panel Surveys

• Work with NSOs to make harmonized microdata from official surveys available to researchers• Several meetings with statistical office presidents since 2000• Several workshops and expert group meetings on international

best practices on data access• Establishment of Open Access Microdata Initiative (OAMDI)

• www.erfdataportal.com

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ERF Labor Market Panel Surveys

Egypt Labor Market Survey 1998

•4,800 households•24,000 individuals•Nationally Representative

Egypt Labor Markey Panel Survey 2006

•8,400 households•3,700 orig. HHs from 1998

•2,200 from splits•2,500 new HHs

•17,400 individuals followed from 1998 to 2006

Egypt Labor Market Panel Survey of

2012

•12,800 household•7,055 orig. HHs from 2006

•3,752 from spits•2,000 new HH

Jordan Labor Market Panel Survey 2010

•5,100 households•26,000 individuals

Tunisia Labor Market Panel Survey 2014

•4,603 Households•16,649 individuals

Carried out with CAPMAS Carried out with DoS

Carried out with INS

JLMPS 2016 is currently in preparation

II. Capacity-Building of Researchers• Series of training workshops on the use of microdata in

labor and human development research• Use of HH Survey Data for Policy Analysis:

• Cairo, 1995, Istanbul, 1998, Amman,1999, Sanaa 2000, Ifrane, Morocco, 2000

• Microdata documentation and dissemination• Cairo, 2012

• Analysis of Panel and Retrospective Data• Cairo 2013

• Measuring Inequality and Inequality of Opportunity• Cairo, 2012, 2013, 2014

• Applied Econometrics and Public Policy Evaluation• Cairo 2015, 2016 (planned)

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III. Promote High Quality Research • Research Competitions

• Research using Labor Market Panel Surveys• Research using Household Income and Consumption Surveys • Education Policy in ERF region• Assessing the impact of labor market regulations and institutions• Labor Demand in ERF region

• Directed Research Projects• Labor market dynamics• Economics of the life course in the ERF region

• Conference Call for Papers• At least half of “labor theme” papers make use of ERF-collected or

disseminated data

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Considerable Research Output• Over 80 working papers on the ERF website on Labor and

Demographic Economics• 20 working papers on Health, Education and Welfare• An average of 8-10 papers per annual conference• At least three research workshops per year• 4 edited volumes

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Some shameless advertising

New Data …. New Analyses• For the first time, LMPS data allowed for dynamic

analyses of the labor market to be carried out in MENA • Panel data from these surveys are unique in MENA. • But even until panel data become available, a

considerable amount can be done using the retrospective data in the surveys

• Can study interlinkages between topics• School-to-work transitions• Employment and marriage interactions• Women’s employment and empowerment• Migration and entrepreneurship

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The structure of the labor demand in the region’s has changed dramatically in recent decades. Where government used to be the dominant employer of new graduates, this role is now played by formal and informal private wage employment Employment Structure by first job limited to those who attained Secondary

education or above

1960 1970 1980 1990 2000 20100%

10%

20%

30%

40%

50%

60%

70%

Year of Entry into the labor market

Perc

enta

ge o

f w

orke

rs

Source: JLMPS 2010

1960 1970 1980 1990 20000%

10%

20%

30%

40%

50%

60%

70%

Year of entry into the labor market

Perc

enta

ge o

f w

orke

rs

Jordan Egypt

Job creation in Egypt in the context of slowing in the growth of the working-age population. The Global Financial Crisis was clearly associated with slowing job creation and an acceleration of job exit

1998

2000

2002

2004

2006

2008

2010

2012

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000

0

1

2

3

4

5

6

Job Creation (Thousands)Job Exit (Thousands)Net Job Creation (Thousands)Net Job Growth Rate (Percentage)Working Age Population Growth Rate (Percentage)Jo

bs in

Tho

usan

ds

Perc

enta

ge G

row

th R

ate

13

Source: Assaad & Krafft (2015)

An analysis of transitions out of employment in the Egyptian labor market reveals that transitions into unemployment are rare. Most people stay in the same job for a long time

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Source: Yassine (2015).

Transitions from employment are still mostly voluntary in Egypt and Tunisia, and only a fraction are to unemployment

Male

Female

Total

Male

Female

Total

Egy

ptTu

nisi

a

0 10 20 30 40 50 60 70 80 90 100

9

3

8

17

13

16

1

4

1

1

8

3

3

3

3

6

7

6

65

27

57

58

29

52

18

50

25

13

29

16

5

12

6

5

14

7

Involuntary to E Involuntary to O Involuntary to U Voluntary to E Voluntary to OVoluntary to U

Percentage of transitions from employment

Source: Assaad, Krafft (2016))

Distribution of Transitions from Employment to Other Labor Market States by Voluntariness of Transition

The transition to first employment for educated workers has changed dramatically across a single generation in Egypt. Social class matters a lot more in access to good jobs.

Less th

an Sec.

Secondary

High. Ed., F

ather

LT ...

High. Ed., F

ather

Sec+ Total0

102030405060708090

100

21 21 14 11 19

38 29

126

27

3228

26

17

28

25

9

7

5

3 3 4 7 48

16

28

106

1924

8

Males, 25-34

Perc

enta

ge

Less th

an Sec.

Secondary

High. Ed., F

ather

LT ...

High. Ed., F

ather

Sec+ Total0

102030405060708090

100

3019 13 17 24

30

1510

21

29

21

1413

24

5

12

12 27

9

4

2946 38

19

3

54

3

Males, 45-54

Perc

enta

ge

16

Family Business Irregular Wage Regular informal in informal firmRegular informal in formal firm Formal Private Formal PublicNo work

Source: Assaad and Krafft (2015)

As public sector opportunities dried up, female new entrants are increasingly likely to not work or become unemployed than to transition right into employment

1998 2006 2012 1998 2006 2012 1998 2006 2012 1998 2006 2012 1998 2006 2012Less than Secondary Secondary Post-Secondary University and Above All

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

0 0 0 5 2 3

29

6 8

29

14 176 4 55 5 6

66 5

6

74

6

54

5 5 5

4232

7

21 24

2

5

90

4

7 132

25

4

2

1

2

3020

18

31

35

23

33

3734

12

14

15

5061

84

3546

70

2839

60

2032

39 4350

68

Public Empl. Private formal Emp. Private Informal Emp. Non-Wage WorkerUnpaid Worker Unemployed Out of LF

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Source: Amer (2015)

In Jordan, it is still worth queuing for a government job, but in Egypt, it is no longer worth it

1970 1975 1980 1985 1990 1995 2000 2005 20100%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

Year of entry into the labor market

Per

cent

age

of w

orke

rs

Evolution of the share of Government wage workers in the distribution of first jobs, jobs after 5 years & jobs after 10 years by year of entry into first employment (6-years moving average)

1970 1980 1990 20000%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

Year of Entry into the Labor Market

Perc

enta

ge o

f wor

kers

Jordan Egypt

Source: JLMPS 2010, ELMPS 2006Source: Assaad (2014)

Persistence in unemployment19

Assaad and Krafft (2016)

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Marriage and Women’s Employment in Egypt, Jordan and Tunisia

Women are more likely to be employed as wage workers in the private sector prior to marriage in Jordan and Tunisia. Women leave such employment at marriage in all three countries, but more so in Egypt. Participation in wage work continues to fall after marriage in Jordan, but recovers substantially in Tunisia

Source: Assaad, Karfft and Selwaness (2016)

Married women do a lot more house work in Jordan than in Tunisia. In all three countries the amount of house work does not change much whether a woman is employed or not

Not Employed

Employed

Not Employed

Employed

Not Employed

Employed

Not Employed

Employed

Not Employed

Employed

Not Employed

Employed

Unm

arrie

dM

arrie

dU

nmar

ried

Mar

ried

Unm

arrie

dM

arrie

d

Egyp

tJo

rdan

Tuni

sia

0 10 20 30 40 50 60 70 80

13

16

31

31

17

17

38

37

11

9

23

20

41

37

42

37

46

40

Domestic hours Market hours

HoursSource: Assaad, Krafft and Selwaness (2016)

Concluding Remarks• ERF’s owes its success in the labor and human

development area to an integrated strategy:• Make high quality data publicly available to researchers• Build the capacity of researchers to use the data• Promote high quality research through research competitions,

directed research projects, research workshops, conferences and peer-reviewed publications

• Building research infrastructure is an integral part of this strategy, but it is not sufficient.• Must be accompanied by capacity building, effective mentoring of

young researchers, and peer review

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