Gender and economic vulnerability in Egypt’s labour market

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Caroline Krafft and
Ragui Assaad
February 08, 2022

The past decade has presented both new challenges and new opportunities for the Egyptian labour market. This column outlines the findings of a new book focused on the extent to which the country has been able to create good jobs for its growing population, as well as particular issues facing women and vulnerable groups in the world of work. The analysis draws on data from the latest Egypt Labor Market Panel Survey, conducted in 2018.

In a nutshell

The overall employment situation in Egypt deteriorated between 2012 and 2018; women’s labour force participation continued to decline.

Even prior to the Covid-19 crisis, Egyptian households frequently experienced economic and health shocks and were vulnerable to negative outcomes due to the limited coverage of social protection schemes.

Pre-existing labour market vulnerability and a sparse social safety net present particular challenges in the face of the Covid-19 pandemic and its associated economic and social difficulties.

How has Egypt’s labour market fared since the revolution of 25 January 2011? Has the country been able to create good jobs for its growing population? How have vulnerable groups and women fared in the labour market?

These are some of the many questions investigated in our recently published, edited volume The Egyptian Labour Market: A Focus on Gender and Economic Vulnerability (Krafft and Assaad, 2021). The volume examines a number of important aspects of Egypt’s labour market, economy and society, including:

The evolution of labour supply, with a particular focus on gender.
Whether the Egyptian economy is creating good jobs.
The evolution of wages, inequality and social mobility.
The school-to-work transition and youth vulnerability.
The evolution of, and preference for, public sector employment.
Trends and patterns of women’s entrepreneurship.
Internal and international migration.
Rural women’s opportunities and challenges.
Social protection and vulnerability.
Household vulnerability and resilience to shocks.
Associations between economic vulnerability, health and wellbeing.

The book draws on the new Egypt Labor Market Panel Survey (ELMPS) 2018 data collected through a collaboration between ERF and Egypt’s Central Agency for Public Mobilization and Statistics (Krafft et al, 2021; OAMDI 2019). This effort was supported by the World Bank, Agence Française de Développement (AFD), the International Labour Organisation (ILO) and the Arab Fund for Economic and Social Development.

The book demonstrates that the overall employment situation in Egypt deteriorated from 2012 to 2018. Although economic growth recovered, growth was relatively jobless. Employment grew at a slower rate than the working age population.

Female labour force participation continued to decline, despite the continuing rise in women’s education. Between 2012 and 2018, men’s participation began to decline as well, a challenge that particularly affected youth.

Low labour supply pressures in the period 2012-18 will continue for five to ten years, given the slow growth in the youth population. But the ‘echo’ of the youth bulge will come of age in a decade, facing even further challenges in the aftermath of the Covid-19 pandemic and associated economic difficulties.

The jobs that were created between 2012 and 2018 were of low quality and were primarily informal and outside establishments. Subsequent research has shown that informal workers, especially those working outside establishments, were particularly vulnerable to shocks, job losses and income losses during the pandemic (Krafft et al, 2021).

Real wages declined between 2012 and 2018. Inflation following the flotation of the Egyptian pound in 2017 contributed to this decline. But job creation was also primarily in sectors with low productivity, constraining wage growth.

A number of groups were particularly vulnerable to labour market challenges over the period 2012-18 (and subsequent Covid-19 shocks). Women continued to experience declining employment rates, as their preferred employment in the public sector continued to shrink. Rural women made important but underappreciated contributions to the economy, while facing a number of vulnerabilities and constraints.

Reconciling disproportionate domestic responsibilities and private sector work remained difficult, particularly for married women. Although entrepreneurship can provide women with important economic opportunities, this potential remained untapped. Women had low rates of entrepreneurship, primarily in the form of survival self-employment.

Food insecurity was already a challenge for Egypt, one that worsened with the pandemic (Assaad et al, 2022). Food insecurity persisted despite the ration card system and bread subsidies, which were broadly available but may not be well targeted. Food insecurity was related to low wellbeing. Egyptians, particularly urban women, had low levels of wellbeing.

The coverage of social protection, particularly social insurance, has been declining, creating additional vulnerability in advance of the pandemic. One bright spot has been the new Takaful and Karama cash transfer programmes, which are targeting vulnerable rural women. This pre-existing social safety net was an important part of the pandemic response (Organisation for Economic Co-operation and Development (OECD), 2020).

Even before the onset of the pandemic, Egyptian households experienced frequent health and economic shocks. Negative coping strategies – especially reducing education and health services – are particularly concerning in light of the pandemic.

Although internal migration and urbanisation rates are low, temporary international migration was an important economic opportunity for Egyptians. This opportunity may, however, have been curtailed with the onset of the pandemic.

Developments since 2018, particularly the pandemic, have underscored the importance of a focus on gender and vulnerability in understanding the labour market. The findings of the book and experiences during the pandemic underline the importance of creating a robust and gender-sensitive social protection system.

The ELMPS 2018 data are a public good, available from ERF’s Open Access Microdata Initiative (OAMDI) at www.erfdataportal.com. The data can be compared to similar labour market surveys in Jordan and Tunisia (OAMDI, 2016, 2018; Assaad and Boughzala, 2018; Krafft and Assaad, 2019) as well as ELMPS waves in 1998, 2006 and 2012 (Assaad, 2009, 2002; Assaad and Krafft, 2015). Although the book highlights important findings from the data, we hope to see a rich body of additional research using ELMPS 2018, as with past surveys.

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