Abstract
This article studies the relationship between firms’ export and import status and the quantity and types of employment they offer, using firm-level data from 47 African countries for the period 2006–14. The article also analyses how the quality of policies at the country-level can relate to the difference between exporters and non-exporters, and importers and non-importers. This article shows that both exporters and importers employ, on average, more full-time permanent workers than their respective non-trading counterparts, even after controlling for a wide range of firm-level characteristics. This employment premium is larger in countries with better quality of infrastructure. In addition, importers employ higher shares of non-production workers compared to non-importers. In addition, both exporters and importers are characterised by higher shares of female employment than their non-trading counterparts. Successful gender policies are positively associated with the female employment premium of trading firms. This article also finds that there is a larger proportion of temporary workers amongst the exporters’ workforce compared to non-exporters, but a better developed rural sector reduces this difference in the use of temporary manpower. The results presented in this article suggest that the quality of policies impacts the extent to which trading firms are able to generate decent job opportunities in Africa.
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Notes
In 2015, negotiations for the Tripartite Free Trade Area were concluded, which is a free trade agreement between the Common Market for Eastern and Southern Africa, the East African Community and the Southern Africa Development Community and consists of 27 African countries. In 2017, negotiations for the Continental Free Trade Area are expected to be finalized, which would form a single market for goods and services, encompassing all 54 members of the African Union. The establishment of a Continental Customs Union by 2022 and an African Economic Community by 2028 are further key benchmarks set up by the Abuja Treaty signed in 1991.
The Sustainable Development Goal (SDG) 8 aims to promote inclusive and sustainable economic growth, employment and decent work for all.
This number is based on the population projections of the UN Population Division.
Vulnerable employment is composed of own-account workers and contributing family workers, which often do not have any social protection.
These employment statistics are based on recent ILO data and estimates for 2016.
In a sample of almost 6000 informal sector firms in West Africa, only 1.0 per cent of firms reported to be exporter and 0.2 per cent of firms reported to be importer (Böhme and Thiele 2014). There is generally a large overlap between informal sector firms and micro firms with less than five employees. For Zambia, for example, 70 per cent of informal sector firms are at the same time micro firms (Shah 2012).
For those countries for which more than one survey has been conducted, the database is in principle an overlapping panel database. However, the number of firms that are observed more than once is very small, so that we can only exploit the cross-section dimension of the dataset.
Monetary variables in Table 1 such as sales, electricity costs and the average wage cannot be directly interpreted, given that they are reported in logs of national currencies. The regressions, however, will use survey fixed effects to control for differences in reported currencies across different surveys.
The firm-level data on different types of employees may cover both formal as well as informal employees. Data on the share of informal employees in different employment categories are not available.
For instance, the REC ECOWAS has a country coverage that is identical to the geographic region of West Africa.
The percentage differences between exporting and non-exporting or importing and non-importing firms is \(100\,*\,(\text{exp}(\beta)\,{-}\,1)\), where β is the respective estimated coefficient reported in the tables.
Already in 2008, COMESA, SADC and EAC (which is composed of member states that are either member of COMESA or SADC) issued a Memorandum of Understanding on the TFTA, in which they endorse the need to harmonise the policies of the three institutions in the context of the overall objective of all the states to attain continental integration as envisaged under the Constitutive Act of the African Union and the Treaty Establishing the African Economic Community.
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Acknowledgements
All views expressed in this article are those of the authors and do not reflect those of the institutions they are affiliated with. We would especially like to thank Mariya Aleksynska, Amrita Datta, Ekkehard Ernst, Verónica Escudero, Zebulun Kreiter, Alakh Sharma and Sher Verick, as well as the participants of the Global Conference on Prosperity, Equality and Sustainability held in June 2016, in New Delhi, India, for their comments and suggestions. We also would like to thank an anonymous referee for his or her comments and suggestions.
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Appendices
Appendices
1.1 A Surveys represented in the dataset
Angola | 2006, 2010 | Madagascar | 2009, 2013 |
Benin | 2009 | Malawi | 2009, 2014 |
Botswana | 2006, 2010 | Mali | 2007, 2010 |
Burkina Faso | 2009 | Mauritania | 2006, 2014 |
Burundi | 2006, 2014 | Mauritius | 2009 |
Cameroon | 2009 | Morocco | 2013 |
Cape Verde | 2009 | Mozambique | 2007 |
Central African Republic | 2011 | Namibia | 2006, 2014 |
Chad | 2009 | Niger | 2009 |
Congo, Republic of | 2009 | Nigeria | 2007, 2014 |
Cote d’Ivoire | 2009 | Senegal | 2007, 2014 |
DRC | 2006, 2010, 2013 | Rwanda | 2006, 2011 |
Djibouti | 2013 | Sierra Leone | 2009 |
Egypt | 2013 | South Africa | 2007 |
Eritrea | 2009 | South Sudan | 2014 |
Ethiopia | 2011 | Sudan | 2014 |
Gabon | 2009 | Swaziland | 2006 |
Gambia | 2006 | Tanzania | 2006, 2013 |
Ghana | 2007, 2013 | Togo | 2009 |
Guinea | 2006 | Tunisia | 2013 |
Guinea-Bissau | 2006 | Uganda | 2006, 2013 |
Kenya | 2007, 2013 | Zambia | 2007, 2013 |
Lesotho | 2009 | Zimbabwe | 2011 |
Liberia | 2009 |
1.2 B Countries represented in the dataset by geographic region
Central Africa | East Africa | Southern Africa | West Africa |
Cameroon | Burundi | Angola | Benin Burkina |
CAR | Djibouti | Botswana | Faso Cape |
Chad | DRC | Lesotho | Verde Cote |
Congo | Eritrea | Malawi | d’Ivoire |
Gabon | Ethiopia | Mauritius | Gambia Ghana |
Kenya | Mozambique | Guinea-Bissau | |
North Africa | Madagascar | Namibia | Liberia |
Egypt | Rwanda | South | Mali |
Mauritania | South Sudan | Africa | Niger |
Morocco | Tanzania | Swaziland | Nigeria |
Sudan | Uganda | Zambia | Senegal |
Tunisia | Zimbabwe | Sierra Leone | |
Togo |
1.3 C Countries represented in the dataset by REC membership(s)
AMU | COMESA | ECCAS | IGAD |
Mauritania | Burundi | Angola | Djibouti |
Morocco | Djibouti | Burundi | Eritrea |
Tunisia | DRC | Cameroon | Ethiopia |
Egypt | CAR | Kenya | |
Eritrea | Chad | Sudan | |
CEN-SAD | Ethiopia | Congo | South Sudan |
Benin | Kenya | DRC | Uganda |
Burkina Faso | Madagascar | Gabon | |
CAR | Malawi | Rwanda | |
Chad | Mauritius | SADC | |
Cote d’Ivoire | Rwanda | Angola | |
Djibouti | Sudan | ECOWAS | Botswana |
Egypt | Swaziland | Benin | DRC |
Eritrea | Uganda | Burkina Faso | Lesotho |
Gambia | Zambia | Cape Verde | Madagascar |
Ghana | Zimbabwe | Cote d’Ivoire | Malawi |
Guinea-Bissau | Gambia | Mauritius | |
Mali | Ghana | Mozambique | |
Mauritania | EAC | Guinea | Namibia |
Morocco | Burundi | Guinea-Bissau | South Africa |
Niger | Kenya | Liberia | Swaziland |
Nigeria | Rwanda | Mali | Tanzania |
Senegal | South Sudan | Niger | Zambia |
Sierra Leone | Tanzania | Nigeria | Zimbabwe |
Sudan | Uganda | Senegal | |
Togo | Sierra Leone | ||
Tunisia | Togo |
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Duda-Nyczak, M., Viegelahn, C. Exporters, Importers and Employment: Firm-Level Evidence from Africa. Ind. J. Labour Econ. 59, 309–341 (2016). https://doi.org/10.1007/s41027-017-0069-0
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DOI: https://doi.org/10.1007/s41027-017-0069-0