Woman working in her textiles shop. Source: Adobe Stock
Jobs are the surest path out of poverty, but not all jobs are the same. “Good jobs” provide not only income but also stability, security, and benefits that enhance well-being and strengthen communities.
These distinctions became evident in the latest Life in Transition Survey (LiTS) conducted by the European Bank for Reconstruction and Development (EBRD) in collaboration with the World Bank. More than half (54%) of respondents identified sufficient income as the most important characteristic of a good job, followed by job stability (23%), good working conditions (11%), and benefits (5%). Yet these features are often missing in the widespread informal employment found across Europe and Central Asia (ECA), and the Middle East and North Africa (MENA).
The survey results suggest that that greater access to benefits from formal employment, such as sick leave and increased job security, are associated with better mental health and greater satisfaction with life. This reinforces the point that people value not just employment, but quality employment that provides protection and stability.
The LiTS survey spanned 37 countries in ECA and MENA, with Germany included as a benchmark. The comparison with an advanced economy helps highlight gaps in job quality across the regions where the EBRD operates.
The survey shows that informal jobs—often lacking basic protections—remain widespread, though. In the countries where the EBRD operates, 14% of jobs have no written contracts, 25% lack annual leave, and 30% provide no sick leave. More than one-third of the jobs in the regions do not offer pensions or social security. Access is especially limited in the southern and eastern Mediterranean region and in Central Asia.
High informality persists even after accounting for income levels. Countries like Jordan and Morocco stand out, with nearly half of workers lacking written contracts—far exceeding what their GDP per capita would predict. Informality is concentrated in certain sectors and occupations—but not inevitably so. Agriculture, construction, services, and sales—particularly lower-skilled roles—have the highest informality rates. However, in Germany, these same sectors show no higher likelihood of informality than others.
The survey confirms a correlation between low pay and a lack of benefits in developing countries. Across ECA and MENA, lower-paid workers are far less likely to have pensions, sick leave, or annual leave. In Germany, by contrast, benefit access does not vary significantly with pay.
The survey also shows that young workers and employees of small firms face greater disadvantage. Jobs held by youth and those in smaller firms are less likely to provide social protections. Public-sector jobs, meanwhile, offer more stability and benefits in general—even though pay is similar to jobs in the private sector.
Tailored policy approaches are needed to balance job creation and job quality. In economies with growing labor forces, ensuring access to good jobs while expanding employment opportunities is a key challenge. As these economies grow, informality often declines, especially when regulations do not stifle growth of firms and employment and optimally encourage more firms to offer benefits rather than moving to informality.
Strengthening unemployment insurance and simplifying regulatory and tax systems—particularly for small firms—can help with reducing informality. Efficient public revenue collection is also critical.
In aging economies, reducing informality is vital to protect older populations. While tight labor markets in shrinking economies may reduce the trade-offs between job quantity and quality, they also present a timely opportunity to push for greater formalization and worker protections.
Read more on job quality, inequality of opportunity, digitalization and support for green transition in the recently published Life in Transition Survey IV Report.
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