Tag Archives: unemployment

The need to promote vocational training in Egypt

University education is considered as the royal road in Egypt. It has contributed to the education of far too many students in recent years compared to the needs of the labor market. Vocational education suffers from a lack of image and does not attract young people. However, according to the latest report of Femise, it deserves to be valued given its relevance in the labor market.

In industry, the shortage of technicians hinders the development of companies

Out of 90 million inhabitants, Egypt currently has 2.5 million students. On the benches of the university, enrollment jumped 20% in four years. The budget devoted to higher education has increased from 18 billion pounds in 2013/2014 to 21 billion in 2015/2016 (ie one billion euros). Admittedly, higher education plays a key role in developing countries. But is it necessary to bet on the university when it is skilled workers that lack Egypt? Is vocational training not also a factor in reducing inequalities?

Femise asks these questions in its latest report (FEM 42-10) published in March 2018 entitled ” Inequality and inclusive growth : Are education and innovation favoring firm performance and well-being?” in three parts. The first, coordinated by the economist Inmaculada Martinez-Zarzoso (Jaume I Universities in Spain) in collaboration with Javier Ordonez from the same University and Dr. Mona Said from the American University in Cairo (AUC), analyzes vocational and technical secondary education in Egypt in 1998, 2006 and 2012.

Femise starts from an observation: “The vocational-general education divide results from a phenomenon of class struggle. The elite relegates the members of the “lower class” to technical schools”. In industry, the shortage of technicians hinders the development of companies.


Match vocational training to the needs of the enterprises

Despite the government’s effort to encourage technical education, the number of students dropped by 3% in 2012. According to the study, this phenomenon can be explained by the relatively low level of returns to technical education, which continues to decline, compared to returns to university education (especially for men in the public sector). For women, the returns to education are even lower in the public and private sectors, regardless of their education. Note, however, a smaller gender gap exist in the private sector.

Redesigning technical education could help promote social mobility and equity. “The quality and relevance of vocational education are the keys to effective reform. The labor market lacks skilled workers. The technical pathways suffer from social stigmatization” underlines the report. It is high time to revalue the image of vocational education, believes Femise. Apprentices are generally poorly paid. The Skills Development Project, with the support of the World Bank, directly benefits Egyptian enterprises of vocational training schemes.

Femise suggests strengthening partnerships between training institutions and companies with financial support from the European Union. But, “encouraging private companies to invest in vocational education will be of no use if trainees still face social stigma,” warns Femise.

Access the FEMISE FEM42-10 report by clicking here

Article by in partnership with Econostrum 

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Labour Market Policies and Informality in Algeria

The report reviews the labour market policy mechanisms implemented by the Algerian government in 2008 and assesses their impact upon informality -informal employment and the informal sector, using data from household employment surveys conducted by the National Statistical Office (ONS) from 1997 to 2013. We examine the situation of three categories: employees, new employees and the self-employed focusing on the effect upon social security registration for employees, and on administrative and fiscal registration of the self-employed. We use the Difference in Difference (DID) methodology and we compare two periods: 1997-2007 and 2008-2013; applying the DID estimator as a falsification test in the first period only. According to results, the impact of labour market policy devices upon informality proves heterogeneous. It has a negative impact on informal employment for the employees who are working in businesses with at least 10 workers. No significant effect is documented for employees in businesses with staff from five to nine workers. For the new employees, the impact is not very significant. Labour market devices also contributed to enhance registration thus shrinking the informal sector, but only for the businesses with staff from one to four workers, whereas no impact upon businesses with staff from five to nine workers.

2008/2009 Euromed Report: Mediterranean Partner Countries Facing the Crisis

Updated on 5/01/10

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Femise Report on Euromed Partnership 2008/2009

Femise has released its latest report on the Euromediterranean Partnership and the situation of the Mediterranean countries. The subject of this year’s report is to provide information about how the crisis is affecting the Mediterranean Countries.

To address these issues, this report will assess in a first part, the crisis from a general perspective, following three chapters: (i) The first chapter aims to determine how the international crisis is going to affect the Mediterranean countries by focusing on the unprecedented aspects of the processes; (ii) The second chapter will detail the system of interdependence linking the Mediterranean countries with the rest of the world, especially Europe via trade of goods and services, direct investment and transfers; (iii) The third chapter is devoted to give an overview of the current social policies set up in the Mediterranean countries, which will play a decisive role in a context where the MPC population is already struggling with unemployment and under-employment.

In the second part, the report addresses  the current situation of the south Mediterranean economies concerned, country by country.

Download the English version of the Report (210 pages – 5 Mo)

Table of Contents

An inescapable crisis
Part one – General overview: MPCs faced with the world crisis
Chapter I: The international crisis and its repercussions in MPCs
I. Tools for understanding an unprecedented crisis
II. The crisis in MPCs: the financial impact is today marginal but the real impact poses more of a threat
III. A much more dangerous crisis in the real sphere
IV. A macroeconomic balance under tight pressure
V. The beginnings of answers in a context of uncertainties
Chapter II. An essential requirement: consolidation of the regional interdependence system
I. Une ouverture qui s’est accélérée mais avec des fragilités
1. Greater opening to world trade of goods ending in a recurrent deficit
2. Commercial positions in the trade of goods on an underlying downward trend
3. Deterioration accelerated by the crisis and affecting new specialisations
4. Substantial international engagement in services
5. Lessons and stakes of a globalisation process begun 20 years ago
II. Regional allegiance: what dynamics and what protection?
1. A multiplication of regional level trade agreements and a growing de facto
commitment towards the rest of the world
2. The weakness of intra MPC trade is a sign of large development potential
3. A sizeable evolution in sectoral specialisations
4. Understanding the position of MPCs on external markets
5. Specialisation and contribution to the trade balance
6. The enhancement of positions on external markets in terms of specialisations
III. Regional orientation of FDI
1. The acceleration of FDI in the second half of the 2000s
2. A dependence on European and Gulf State flows
3. The economic consequences of this flow of direct investment
4. A post-crisis which requires more attractiveness from the MPCs
5. Conclusions
Chapter III. Social cover in the Mediterranean
I. The social services offer in the MPCs
1. Inventory of social protection systems in the Mediterranean
2. Operating principles: structural limits and questions linked to the context of the crisis
II. The results obtained by the current systems of protection
1. Considerable progress of the healthcare state, but still a marked gap with Europe
2. Varied effectiveness of social policies in the reduction of poverty
3. Evolution of inequalities
III. Leads for recommendations for social policies in a context of crisis
1. Reform of the health sector
2. The strengthening of Social Protection
3. Promote employment and participation in the formal job market and fight unemployment
4. The reduction or elimination of price subsidies and the adoption of alternative regimes
5. The need to find an alternative methodology for measuring well-being
6. The need for pluriannual budgetary programming for optimal visibility of strategic choices
IV. In conclusion
Part two – Detailed situation in MPCs : country sheets