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Labor and Social Protection

Low-skilled labor migration: Korea’s Employment Permit System

Soonhwa Yi's picture

(In observance of the International Migrants Day on December 18)

In response to looming labor shortages in the so-called “3-D” industries (difficult, dangerous, dirty), Korea has allowed the entry of low-skilled foreign workers since 1990’s. Its Industrial Trainee Scheme introduced in 1993 was inadequate to address labor demand (an increasing employment of irregular foreign workers), unequipped to warrant trainees’ labor rights and social protection, and associated with high recruitment cost borne by trainees. The latter appears to be liked with trainees’ overstay - to recoup their initial sunk cost. 

A Safety Net for Stella

Kavita Watsa's picture

Bold Steps to Reduce Extreme Poverty in Tanzania
The government is supporting Tanzania's poorest families in an effort to reach those left behind by the country's largely urban growth.

Mtoto mzuri sana. Stella’s face lights up as I admire her baby, but she doesn’t reply. We are in the primary school compound in Chehembe, a village about 50 kilometers from Tanzania’s administrative capital, Dodoma. Stella is waiting to be registered in the country’s social safety net program, which is meant to cushion very poor households against sudden losses of income. And we are waiting to hear Stella’s story, to ask her how many children she has, and how she earns a living.

Should Government Give Money to Tanzania’s Poor?

Jacques Morisset's picture

Men tilling a rice paddie on an irrigation project When confronted with financial distress or some other difficulty, over 80 percent of Tanzanian families say they count on relatives and friends for the support needed to get through it. This is to be expected in African culture which is shaped by a strong sense of affinity with family and tribal ties. 

However, in a poll conducted by the World Bank and Twaweza by phone in November, almost half of Tanzanian households also expressed that they expect to receive some help from their Government (see details in the fourth Tanzania Economic Update). In a world characterized by rapid urbanization and structural changes, government assistance is increasingly viewed as critical. In cities, especially, traditional ties and safety nets are generally losing their force. With economic progress, income disparities tend to widen. For example, the proportion of people living in extreme poverty (i.e. with barely enough resources to afford a 2,000 calorie diet) is only one percent in Dar es Salaam but over 15 percent in most rural areas.

A Tale of Two Impacts: Minimum Wage Outcomes in South Africa

Haroon Bhorat's picture

Worker pruning fruit trees Economist and Nobel Prize laureate James M. Buchanan remarked to the Wall Street Journal in 1996 that "Just as no physicist would claim that "water runs uphill”, no self-respecting economist would claim that increases in the minimum wage increase employment."  Of course this statement remains broadly true today, but the advent of better data, improved statistal techniques and the proliferation of country studies – have made economists far more careful about pre-judging the impact of minimum wages on employment and wages.  Indeed, in a now famous study of fast food restaurants in New Jersey and Pennsylvania, David Card and Alan Krueger showed how the imposition of a minimum wage had no significant disemployment effects, and in some cases increased employment, arising out of a large enough increase in demand for the firms’ products.
 
The evidence for South Africa, some twenty years after the demise of apartheid, is equally compelling.  In a two-part study, my co-authors and I find an intriguing set of contrasting economic outcomes, from the imposition of a series of sectoral minimum wage laws.  In South Africa, the minimum wage setting body, known as the Employment Conditions Commission (ECC), advises the Minister of Labour on appropriate and feasible minimum wages for different sectors or sub-sectors in the economy.  Currently, the economy has in place 11 such sectoral minimum wage laws in sectors ranging from Agriculture and Domestic Work, to Retail and Private Security.

Scaling up Support for Egypt

Inger Andersen's picture

During her recent visit to Cairo, the World Bank's Vice President for the Middle East and North Africa Region Inger Andersen reiterated the Bank's support for an inclusive economy in Egypt that enables all citizens to take part in shaping their future.

Notes From the Field: Taking On Politics, Shifting Paradigms

Miles McKenna's picture

Editor's Note: "Notes From the Field" is an occasional feature where we let World Bank professionals conducting interesting trade-related projects around the globe explain some of the challenges and triumphs of their day-to-day work. The views expressed here are personal and should not be attributed to the World Bank. All interviews have been edited for clarity.

The interview below was conducted with Manjula Luthria, a Senior Economist in the World Bank’s Middle East and North Africa (MENA) regional division of the Human Development Network. Ms. Luthria's work focuses migration, labor mobility, and social protection. She spoke with us about her early experiences as a country economist for the Pacific Islands region, and how lessons learned there have come to inform the programs and projects her unit works on today.
 

Migration as Structural Transformation

Shanta Devarajan's picture

IN024S05 World Bank When a poor person moves from a low-productivity job to a higher-productivity one, we usually celebrate.  The worker is clearly better off; the hiring firm is no worse off; and it’s good for the economy as a whole.  Indeed, development is often described as the process of structural transformation, where low-productivity workers (typically in agriculture) move to higher-productivity jobs in manufacturing or services. 

But when that same worker happens to cross a national border, we call it “migration” and, instead of celebrating, we start investigating the effects on workers, firms and public finances in the new environment; and on those left behind (the so-called “brain drain”).  Instead of promoting structural transformation, we look for policies to manage it.

The Missing Conversation: How to Build a Moral Capitalism in the Arab Region

Ishac Diwan's picture

A young Egyptian holding a flag The Arab transition countries, Tunisia, Egypt, Yemen, and Libya, are grappling with complex issues relating to personal values, the extent of freedom of speech, individual rights,  family matters, that all orbit around deep issues of identity and the respective roles of the individual, the state and society. These social conversations are constructive in that they reflect a rich pluralism of views in societies where conformity was the rule under dictatorship. But unfortunately, these dialogues are polarizing society, leading to violence and threatening chaos and a possible return to authoritarianism. In fact, the current social polarization to a large extent reflects attempts by political entrepreneurs to use existing social fault lines, and even exacerbate them, in ways that mobilize passions among possible supporters, driven to over-reach by the political vacuum created by the departure of the historical autocrats. The dynamics in Morocco, Jordan, Algeria, and Lebanon are slightly different, but here too, the intense and exclusive focus on identity is crowding out more important and immediate social and economic challenges.


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