EVALUATING EMPLOYMENT POLICY PROGRAMS TO ALLEVIATE THE UNEMPLOYMENT: CASE STUDY OF EGYPT (In Arabic) | ||||
| Journal of Productivity and Development | ||||
| Article 12, Volume 13, Issue 1, January 2008, Page 163-190 | ||||
| Document Type: Original Article | ||||
| DOI: 10.21608/jpd.2008.44836 | ||||
 View on SCiNiTO | ||||
| Author | ||||
Ahmed Qadry Bahloul 
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| Depart. Agricultural Economics, Productive Efficiency Institute of Zagazig University, 44519, Zagazig University, Egypt | ||||
| Abstract | ||||
| The definition of unemployment includes that a person without work although he is willing, able, and looking for work. It is measured by the number of unemployed to the labor force. The underemployment means that the person is working less than the level of work he/she wish, or the form in which it is not commensurate with his skills, and therefore with reduced labor productivity. Despite the efforts of the government of Egypt to tackle the problem of unemployment, the studies described as partial or temporary palliatives. Thus the unemployment problem requires the formulation of employment policy to build a sustained system to alleviate the problem of unemployment. The main problem is summarized by the following research question: What is the effectiveness of the policy of the labor market to alleviate the problem of unemployment through the generation of jobs over the last decade?. The research objective summarized in evaluating the policy of the labor market during the period (1996-2006) to identify their contribution to the generation of new employment opportunities to alleviate the unemployment problem in Egypt. There are two approaches to evaluate the employment policy: first, the microeconomic effects approach, which compares two groups, one policy beneficiaries, and another comparison group. Second, the macroeconomics effects which interested in studying the impact of macroeconomic policy on indicators such as the unemployment rate using the econometric analysis. The second approach is appropriate for the current research. The most important findings of the research include: The overall unemployment rate and by gender during the period (1997-2006) are increased , while the unemployment rate for the educators fell because of the shift of their attitudes positively to towards self-employment and the private sector, especially informal sector. The regional distribution of unemployment in Egypt according to the population census of 2006shows that the unemployment rate amounted to 53% in the urban areas in Egypt, and 47% in rural areas due to the ability of the agricultural sector to absorb family farm unemployment. The unemployment rate is about 43% of the Lower Egypt, 33% in Upper Egypt, 22% in Urban governorates, and 2% in the Border governorates. That means that about 76% of total unemployment is concentrated in the Upper Egypt and Lower Egypt. Most of the urban unemployment is concentrated in the Urban governorates by about 22%, and Lower Egypt, 15%, Upper Egypt 14%. The rural unemployment concentrated in Lower Egypt, which dominated the approximately 29% of the total unemployment, while represented about 17% in Upper Egypt. The underemployment in the countryside is about 61% and mounted to 39% in the urban areas, which means its spread in the rural areas is more than the urban areas due to increase of the temporary, and seasonal work, and because of the nature of agricultural and rural activities. The underemployment leads to a vicious circle of low labor productivity, thus low competitiveness, and the low level of reinvestment to generate additional job opportunities. This problem is more acute in the Border governorates. Adding the underemployment to the unemployment estimate the total unemployment, which amounted to 34% in the urban areas of Egypt and about 39% in the countryside, while about accounted for 37% of Egypt. The ratio of non-permanent employment amounted to 26% in the urban areas in Egypt, about 33% in the rural areas in Egypt, and about 30% of the non-permanent employment in Egypt. The intermittent work towards represents 18% of the non-permanent employment in Egypt. An analysis of the unemployment problem in Egypt explores the following reasons: First-low demand for work for two reasons: A. the weak growth rates of the national economy to generate enough jobs, commensurate with the growth rate of labor supply, due to the weak export performance, low level of investment because of ineffective economic policies. During the period (1990-2006) the findings indicate declining the impact of investments accompanied with negative impact of the exchange rate of the pound against the US dollar through its negative impact on the performance of the export sector. Although the private sector demanded nearly 72% through newspaper advertisements, including 60% of them are university qualifications, it was unable to sufficiently absorb the unemployment. During the period (2006-2007), the investment climate in Egypt is improved compared to economics of 178 countries all over the world, where Egypt occupied the rank 126 in 2007 compared with the order 165 in 2006. B. It also attributed the low labor demand to the lower level of the export of labor to foreign markets due to the Egyptian ineffective immigration policies, and not coordinated with the countries receiving the Egyptian employment. The migration rate declined by -29% during the period (2002-2006). The findings showed that about 10% of foreign demand for employment by advertising in the Egyptian newspapers mostly for occupations demanding the university qualifications. Second- increasing the supply of labor due to an increase in the growth rate of labor force because of the high rate of population growth. In addition to, inadequate quality, and characteristics of work for graduates from institutions of education and training in relative to the requirements of the labor market, which was privatized by the privatization of public sector companies, and reduce the level of government employment. In 2004 the educated unemployment rate was 98% of the total unemployment. Adds numbers enrolled in the private universities increased the unemployed holders of the qualifications in the labor market. The findings showed imbalance demand and supply for skills in Egypt. Third- The imbalance and the weak performance of the labor market in Egypt due to inadequate institutions governing the labor market and the trend towards downsizing government employment, and in the public sector. But because the government seeks to employ the unemployed qualified in government jobs, which led to a decline in the educated unemployment rate. The most important consequences of the unemployment problem are wasting human resources caused the loss of community, and individuals alike, and that damage of social stability, and endangering society groups depended on wage as the single source of income and lowering their standard of living. The study findings of the policy programs to alleviate the problem of unemployment in Egypt are as follows: First- Regarding to create new job opportunities during the fifth five-year plan period, the rate of unemployment increased by 2% due to slowing the rate of real economic growth, which amounted to 5.5%. Reducing unemployment to a natural rate of 5% require an increase of the rate of real economic growth to 7% annually, which requires a lot of investment, and to stimulate the private sector's contribution. Second- The policy programs during the period (July 2004-January 2006) of the current Egyptian government provided about 88% of the annual target rate, which is 750 thousand jobs. Third- The study of the employment program performance to alleviate unemployment during the period (2001-2007) indicated that the rate of change in the labor force exceeds the rate of change in the number of workers by 1%, which remains the problem of Egyptian unemployment at the current level. The unemployment rate fell by 11% and the rate of the educators’ unemployment decreased by -16%, due to the recruitment of government mainly. The proposed strategy elements for the employment policy to alleviate the problem of unemployment in Egypt summarized as follows: First- Increasing the demand for labor increased the real growth rate to 7% and more especially in the labor-intensive sectors of the economy through improved productivity, increased investment, and promoting the export performance through reform of integrated economic and social policies, legislation, to improve the investment climate. It also must work to increase the export of labor conventions through active participation of the countries employing the Egyptian employees. In addition to, enhance the Egyptian labor migration policy of the Egyptian workers abroad. Second - Reconciliation of disequilibrium between the quantity and quality of the labor demand and supply through reducing population growth rate via appropriate population policy. It is also necessary to develop the education, training and human development policies required to meet demand side specifications in the Egyptian labor market through the provision of adequate funding and improve the structure of incentives in these sectors. The establishment of the Monitor for the Education, training and Employment is important policy tool to secure the required studies to achieve the reconciliation process. Third – Balancing and controlling the performance of the labor market by preparing a database for the demand and supply on employment suitable to build a sustainable employment system, while continuing to recruit the government sector employees, and planning the transfer of the informal sector to formal sector with emphasis on the creation of legitimate employment channels under the control of the Egyptian Ministry of Manpower and Migration. | ||||
| Keywords | ||||
| Evaluating employment; Policy programs; alleviate unemployment; case study; Egypt | ||||
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