2011年-世界发展银行全球_Key_Characteristics_of_Employment_Regulations_in_the_Middle_East_and_North_Africa_4页_646kb

MNA Knowledge and Learning: Key Characteristics of Employment Regulations in the Middle East and North Africa

Core Content Overview

This Fast Brief provides an analysis of labor regulations in the Middle East and North Africa (MENA) region, focusing on how these regulations impact labor market outcomes. It is part of the World Bank's effort to understand employability constraints in the region and inform policy reforms aimed at employment creation.

Main Features of Labor Regulations in MENA

• Employment Rates: MENA employment rates are lower than global averages (46% vs. 60.3% in 2008), primarily due to low female labor force participation.
• Unemployment Rates: Unemployment is higher in MENA (10% vs. 6% globally), with youth and women being disproportionately affected.
• Job Creation Needs: The Arab Mediterranean Countries (AMCs) require over 1.5 million new jobs annually for the next decade to address labor market entry challenges.
• Economic Growth Requirements: Achieving this will require higher economic growth than previously recorded, which is difficult in the current economic climate.
• GCC Countries: These countries have more flexible labor regulations and are less constrained by them in terms of employment creation.

Labor Regulations and Business Constraints

• Perceived Constraints: In countries like Egypt, Lebanon, Oman, and Syria, labor regulations are seen as a major constraint on business environments and employment creation.
• Hiring Flexibility: Most MENA countries have flexible hiring regulations, allowing for fixed-term contracts.
• Overtime and Leave: Overtime is common but often misused by employers. Annual leave is generous, especially for public servants.
• Maternity Protection: Maternity benefits are present but not generous. Employers often bear the cost, which can deter hiring women.

Firing Regulations and Labor Market Rigidity

• Strict Firing Laws: Firing regulations in non-GCC MENA countries are strict, with high costs and complex procedures.
• Redundancy and Justification: Termination due to redundancy is allowed but requires justification, notification, and approval.
• Unemployment Insurance: Most MENA countries lack effective unemployment insurance (UI) systems, which are crucial for worker protection.
• Informal Employment: A significant portion of the labor force is in the informal sector, where labor laws are not applied.

Compliance and Enforcement Issues

• De Facto Non-Compliance: Despite strict labor laws, compliance is low due to weak enforcement and lack of awareness.
• Informal Labor Market: Labor laws mainly affect formal sector employment, leaving a large portion of the workforce unprotected.
• Employer Practices: Employers often bypass regulations through practices such as undated voluntary resignations.

Impact on Private Sector Employment

• Hindrance to Growth: Protective labor regulations, especially regarding dismissal, hinder private sector employment creation.
• Informality and Unemployment: Stricter employment protection legislation (EPL) is linked to higher informality, youth and female unemployment, and lower productivity.
• Segmentation: Labor markets are segmented between protected (insiders) and unprotected (outsiders) workers.

Policy Implications and Reform Recommendations

• Shift Focus: Governments should prioritize protecting workers' income over protecting specific jobs.
• Unemployment Insurance: Expanding UI systems can provide support during labor market transitions.
• Integrated Reforms: Labor regulation reforms should be paired with social protection reforms to ensure worker security.
• Lifecycle Approach: Reforms should adopt a lifecycle perspective, supporting workers throughout their employment journey.
• Political Economy Considerations: Reforms must consider institutional capacity, fiscal constraints, and the influence of trade unions.

Conclusion

Labor regulations in the MENA region are complex and often not effectively enforced, leading to significant challenges in employment creation and labor market flexibility. Addressing these issues requires a multifaceted approach that includes improving legal awareness, strengthening enforcement mechanisms, and integrating labor and social protection reforms.

Key Contacts

• Director, MNACS: Emmanuel Mbi
• Regional Knowledge and Learning Team: Omer Karasapan, Roby Fields, and Hafed Al-Ghwell
• Tel #: (202) 473 8177
• MNA K&L Fast Briefs: http://go.worldbank.org/OXADZV71I0

Note: The MNA Fast Briefs are summaries of lessons learned and do not necessarily reflect the views of the World Bank, its Board, or its member countries.