DIMENSIONS OF THE SOCIAL PROTECTION CHALLENGE IN ZIMBABWE: REVITALISING LABOUR MARKETS - PowerPoint PPT Presentation

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DIMENSIONS OF THE SOCIAL PROTECTION CHALLENGE IN ZIMBABWE: REVITALISING LABOUR MARKETS

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Title: DIMENSIONS OF THE SOCIAL PROTECTION CHALLENGE IN ZIMBABWE: REVITALISING LABOUR MARKETS


1
  • DIMENSIONS OF THE SOCIAL PROTECTION CHALLENGE IN
    ZIMBABWE REVITALISING LABOUR MARKETS

2
Outline of Presentation
  • 1. The link between economic growth, employment
    and social protection / poverty reduction
  • 2. Overview The Zimbabwean Experience
  • 3. Developments in Human Capital Formation
    1980-2009
  • 4. Sustainable Recovery Pathways

3
The Link Between Growth, Employment and Poverty
Reduction/Social Protection
  • Social protection is defined as a set of public
    and private, formal and informal measures that
    assist people to manage risks and minimize the
    incidence and impact of welfare losses that might
    lead to unacceptable living standards.
  • Such welfare losses may arise as a result of
    internal or external economic shocks, natural
    disasters, loss of employment, personal and
    family tragedies.
  • Since the impact of such shocks varies in
    duration, scope intensity, so do the measures
    to deal with them.

4
  • These fall into three main categories, namely
  • coping (social safety nets including the health
    and education fee waiver schemes, food hand-outs
    etc),
  • mitigating (income security interventions such as
    public works programmes, price subsidies, seed
    packs etc) and
  • preventive (social security aspects including
    public and private pension and insurance
    schemes).

5
The Dual Economic Structure
  • Three important features that distinguish
    developing countries from developed ones are
  • The first is dualism the existence of two
    radically distinct parts a formal segment
    employing a small proportion of the labour force,
    and a non-formal segment (the rest of the
    economy) employing the bulk of the labour force.
  • Production in the formal sector involves the use
    of reproducible capital as well as skilled and
    unskilled labour, while that in the non-formal
    segment involves use of unskilled labour, natural
    resources and simple tools and implements huge
    gaps in labour incomes and productivity.
  • In the formal segment, production is for profit,
    while in the non-formal sector it is for
    subsistence.
  • In the formal sector, workers are engaged as
    regular, full-time wage employees, while in the
    non-formal segment they are either self-employed
    or engaged as casual irregular wage workers.

6
  • Government regulations and institutions of
    collective bargaining exist in the formal
    segment, while absent in the non-formal sector.
  • The second feature is surplus labour a
    substantial portion of workers in the non-formal
    sector are under-employed (work and income
    sharing).
  • The third feature is the near-total absence of
    institutionalized social security only a few
    people from well-off households can survive
    without working most people must work to
    survive.

7
The Dual and Enclave Zimbabwean Economy
DEVELOPMENT POLICIES Monetary fiscal
policies Wage employment policies Sectoral
policies Savings investment
FORMAL SECTOR Male-dominated sector. Its the
focus of all economic development policies.
INFORMAL ECONOMY This is a female- dominated
sector. In addition, this sector is marginalised
COMMUNAL ECONOMY Women also dominate this sector.
In addition, this sector is marginalised
Formal sector lt20 percent of labour force
Non-formal sectors gt80 percent of labour force
8
  • At independence in 1980, Zimbabwe inherited a
    dual economy a relatively developed formal
    sector existing alongside a relatively
    underdeveloped non-formal, predominantly communal
    sector.
  • The formal sector employed about 20 of the
    labour force (1 million people) it now employs
    13 of the labour force (2007).
  • The preventive aspect of social protection mainly
    targets the formal sector, and even in the formal
    sector not all sectors are covered.

9
Current Situation of Social Protection vis-à-vis
Economic Development in Zimbabwe
A
B
C
SOCIAL PROTECTION
DEVELOPMENT PROCESS
COPING
Few people are currently contributing to their
own social protection
10
Situation of Social Protection vis-à-vis Pro-Poor
Growth and Development
DEVELOPMENT PROCESS
SOCIAL PROTECTION
More people contributing to their own social
protection
11
  • Overtime, with equitable growth, the strategy is
    to gradually scale down coping and mitigatory
    social protection mechanisms while increasingly
    expanding long-term preventive ones a shift from
    passive measures towards more active ones.
  • Pro-poor growth allows the National Social
    Protection Strategy to gradually scale down on
    coping and mitigatory measures, while increasing
    the long-term preventive ones.
  • Thus, the success of the social protection
    strategy will depend on the level of inclusive
    (equitable) growth and development achieved.

12
The Labour Market and Poverty Reduction
  • Robust growth is a necessary condition for
    sustained poverty reduction.
  • However, the link between growth and poverty
    reduction is not automatic.
  • The labour market, and decent employment in
    particular, play an intermediating role (the
    nexus) between growth and poverty reduction.

13
  • Decent work entails productive work where rights
    are protected, generating adequate income, with
    adequate social protection.
  • It also implies adequate work where all have
    full access to income-generating opportunities.
  • This means employment, income and social
    protection are achieved without undermining
    workers rights and social standards.
  • Decent work has 6 dimensions, namely
  • Opportunity to work.
  • Productive work.
  • Freedom at work.
  • Equality at work.
  • Security at work.
  • Dignity at work.

14
  • For sustained poverty reduction, 3 factors are
    critical sustained growth, employment elasticity
    of output and integrability of the poor.
  • The employment response is greater where growth
    is concentrated in the more labour-intensive
    sectors.
  • The capabilities of the poor determine the extent
    to which they can participate in, and benefit
    from growth.
  • Social policies (education, health, income
    grants) and policies that promote equity create a
    virtuous cycle of links between growth,
    employment poverty reduction.

15
Overview The Zimbabwean Experience
Formal employment declined from 14 of the
population in 1980 to 10 by 2004 and 6 by 2006
16
Average real earnings have collapsed from an
index of 120 in 1982 to 10 by 2004.
17
  • High levels of unemployment and decent work
    deficits by 2003, 72 of the population was
    below the poverty line, up from 55 in 1995
  • Female-headed households had a higher incidence
    of poverty at 68 compared to male-headed
    households at 60 - poverty has a rural face and
    a womans face.
  • The percentage of the population employed in the
    formal sector declined from 14 in 1980 to 10 by
    2004 around 6 by 2007.
  • Growing informalization and deepening dualism in
    the economy 4 out of 5 jobs were informalized by
    2004.
  • The disappearance of a middle class the missing
    middle
  • Inequality worsened the gini-coefficient
    increased from 0.53 in 1995 to 0.61 in 2003
    fewer gains from growth accrue to the poor.
  • With partial dollarization, 65 of Zimbabwes
    population is unbanked.

18
  • The Brain drain
  • An estimated 2-4 million Zimbabweans lived
    outside the country by the end of 2007.
  • South Africa had over 1 million Zimbabwean
    migrants.
  • The UK had the second-largest population of
    Zimbabweans, with an estimated 200,000500,000.
  • In third place is Botswana, at 100,000-300,000.
  • Zimbabweans living abroad now constitute a
    Diaspora, i.e. a homogeneous people with a common
    sense of displacement, both voluntary and
    involuntary, with a hope of returning home one
    day.

19
The Flow of Remittances to Zimbabwe
  • IFAD estimates remittance inflows to Zimbabwe at
    US1.3 billion in 2004 and at US361 million in
    2007.
  • According to the RBZ, officially recorded foreign
    currency receipts through the Homelink system
    were estimated at US 5.7 million in 2006 and
    US47.5 million in 2007.
  • If IFAD estimations for 2007 are correct, this
    implies only a small part of remittances are
    transferred through official channels.
  • A recent study suggests that as much as 81.7
    percent of Zimbabwean diasporas living in
    Northern England remit.
  • The study estimated that US0.94 billion was sent
    from the UK to Zimbabwe in 2007.
  • Such remittances became an important source of
    social protection for many Zimbabweans.

20
  • Impact of HIV and AIDS
  • The adult prevalence rate declined from 24.6 in
    2003 to15.9 by 2007 to 14.9 by 2009.
  • Life expectancy declined from 57 years in 1982 to
    35.5 years by 2007.
  • Intercensal population growth fell from 3.9
    (1982-92) to 1.2 (1992-2002).
  • Losses of human capital higher in the productive
    age group 15-49 years, the most affected.
  • Impact disproportionately higher among skilled,
    professional and managerial workers.

21
Developments in Human Capital Formation
19802009
  • Investment in human capital is mainly through
    education and training it enhances
    integrability.
  • Net enrolment at primary school level declined
    from 98.5 in 2002 to 96.7 by 2006.
  • Net enrolment at secondary education level
    declined from 50.2 in 2001 to 46.3 by 2006.
  • The rapid expansion of the education and training
    system undermined its quality.

22
  • The pupil-teacher ratio at primary level was
    almost constant during 2000-2006, averaging 38 1
    (optimal ratio is 281).
  • Severe shortages of resources (financial, human
    and material).
  • Pass rates at O level declined from 25 in 2000
    to 14 in 2006, while at A level from 83 in
    2003 to 74. by 2006.
  • Little teaching and learning in 2008 due to
    elections and industrial action by teachers.
  • Education system lacks a pathways approach.

23
Sustainable recovery pathways
  • Strategic Objectives
  • Enhance the opportunities for more people to
    participate in gainful employment and activities
    that will improve their capabilities to
    contribute towards social security programmes,
    invest in income security programmes, thereby
    reducing their dependency on coping mechanisms.
  • Promote full, productive and decent employment.
  • Mainstream employment creation in all policy
    frameworks to achieve employment-intensive
    recovery
  • Reorganize TVET to make it more demand-driven and
    responsive to the needs of the economy.
  • Promote sustainable and inclusive recovery
    pathways in the labour market, and in education
    and training.

24
Recovery Pathways
  • Pursue an employment-intensive recovery programme
    by amongst other things
  • Mainstreaming employment creation in all policy
    frameworks macroeconomic, fiscal, monetary,
    industrial, financial, agricultural
  • employment-intensive rehabilitation and
    development of infrastructure
  • Integrate the non-formal sectors through
    empowerment measures including maximally
    utilising land
  • Strengthen backward and forward linkages through
    the exploitation of value chains and channels
    among firms and sectors to create employment
    multiplier effects

25
  • Promote business linkage programmes, (including
    franchising, contracting, toll manufacturing and
    outsourcing), mentorship and internship
    programmes to achieve more inclusive outcomes
    than is the case in individual firm or sector
    approaches.
  • Reorganise TVET to make it more demand-driven and
    responsive to the needs of the economy by
  • Establishing a National Training Authority based
    on ZIMDEF funding.
  • Implementing the two-pathways policy at the
    secondary level of education.
  • Redesigning the curricula to meet the specific
    demands of the non-formal sectors.

26
  • Promote Active Labour Market Policy Measures
  • i) Employability (Labour Supply)
  • Innovative, gender-sensitive training and skills
    development programmes, such as apprenticeship
    programmes, mentorship, business incubators,
    promoting a culture of entrepreneurship, etc
  • Vocational training programmes designed and
    implemented in partnership with the private
    sector.
  • ii) Employment creation (Labour Demand)
  • SME and cooperatives promotion and development
  • Labour-based public works
  • Business linkages
  • Self-employment programmes.

27
  • More people participate in gainful employment and
    activities that will improve their capabilities
    to contribute towards social security programmes,
    invest in income security programmes, thereby
    reducing their dependency on coping mechanisms.

28
  • Develop and implement a policy framework for
    return migration and utilization of Diaspora
    skills (including dormant skills).
  • Design programmes of voluntary assisted return.
  • Engage in co-development programmes with
    countries that have a high concentration of
    Zimbabweans.
  • Put in place immigration policies that make it
    easier to attract skills.
  • Allow dual citizenship to foster national
    attachment.
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