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Additional resources for Labor and the growth crisis in Sub-Saharan Africa
Sample text
But they left the majority of African workersthose in agriculture and the informal sectorwith low returns on their labor. When the underlying strategy proved unviable and macroeconomic forces led to economic collapse, even "insiders" saw their earnings plummet. Today the need for new approaches is recognized across the region, although the pace of reform varies widely. Determinants of Growth Economic growth depends on raising the productivity of all factors of production, including labor. That requires accumulationinvestments by households and employers in physical capital, new technologies, and worker skills.
Growth in exports as a share of GDP is associated with more rapid increases in real wages and the expansion of employment opportunities. Capital flows have supplemented domestic savings, and when these resources have contributed to productive investments, labor has benefited. Through both permanent and temporary migration labor, like capital, has sought its highest return, increasing individual earnings and improving household welfare, often through remittances. But not all workers or regions have benefited.
Page 3 Box 1. How much unemployment is there in Sub-Saharan Africa? Most quoted unemployment rates are based on the International Labor Organization definition: people above a specified age who, during the reference period (for example, the past week), are without work, currently available for work, and seeking work. By this definition, the unemployed usually account for all small percentage of the working-age population, especially in countries with large rural population where working on the family farm or working for others on a casual basis is common.