Cape Verde : Initial Assessment of the Formal Labor Market

In the last 25 years, Cape Verde has made impressive progress in their historical transition from a centrally planned to market economy. Building the institutional foundations of a market economy, this small nation of islands located off the coast of West Africa has developed a vibrant private sector and opened to international trade. This has ignited economic growth, which in turn has brought about higher incomes and reduced poverty. Currently, Cape Verde has a well-functioning market economy and as a result graduated from the ranks of the low income countries to one of middle-income status. Such a successful transition, achieved over a short period of time, exceeded many observers' expectations. In any economy, the issue of high and persistent unemployment centers on the dynamics of net job creation linked to firm entry and firm expansion. The issue of disparities in labor market outcomes centers on the tendencies of reallocation of jobs and workers away from less productive regions, sectors and firms toward more productive economic activities. This study finds that in both fronts-net job creation and reallocation, there is reason for optimism. Job creation is substantially above job destruction. With respect to divergent labor market outcomes across islands, there is a trend towards convergence indicating that a national and integrated job market is emerging. Furthermore, as expected, these two developments are highly interlinked; emigration from areas and sectors characterized by relatively lower job growth and immigration into regions and sectors with relatively higher job growth is taking place. The study also offers preliminary findings about the effects of a public sector wage premium on labor market outcomes and, separately, there are indicative findings on factors that may be affecting the decision of workers to enter and stay in the informal sector or enter into formal employment.

Bibliographic Details

Main Author:	World Bank
Language:	English
Published:	World Bank 2010-12-17
Subjects:	ACCESS TO HEALTH CARE, AGE GROUP, AGE GROUPS, AGRICULTURE, AVERAGE PRODUCTIVITY, AVERAGE WAGE, AVERAGE WAGES, BARGAINING, BARGAINING POWER, BASE YEAR, BASIC EDUCATION, BENCHMARK, CITIZENS, COLLEGE EDUCATION, COMPETITIVENESS, CREATING JOBS, DEPENDANTS, DEVALUATION, EARNING, EARNINGS ABILITY, ECONOMETRIC MODELS, ECONOMIC CONDITIONS, ECONOMIC GROWTH, ECONOMIC INTEGRATION, ECONOMIC OPPORTUNITIES, ECONOMIC OUTCOMES, ECONOMIC PERFORMANCE, ECONOMIC THEORY, ELASTICITY, EMPLOYEE, EMPLOYMENT, EMPLOYMENT CREATION, EMPLOYMENT GENERATION, EMPLOYMENT GROWTH, EMPLOYMENT GROWTH RATE, EMPLOYMENT GROWTH RATES, EMPLOYMENT INCREASE, EMPLOYMENT TRENDS, ENTRY RATE, FAMILY MEMBERS, FAMILY RESPONSIBILITIES, FAMILY SUPPORT, FINANCIAL CRISIS, FIRM ENTRY, FIRM LEVEL, FOOD SECURITY, FOREIGN DIRECT INVESTMENT, FORMAL LABOR MARKET, FORMAL SECTOR WORKERS, FUTURE STUDIES, GDP, GDP PER CAPITA, GINI COEFFICIENT, GROSS DOMESTIC PRODUCT, HEALTH CARE, HIGH UNEMPLOYMENT, HIGH WAGE, HIGH WAGES, HOUSEHOLD INCOME, HOUSEHOLD SURVEY, HOUSEHOLD SURVEYS, HUMAN CAPITAL, ILLNESS, IMMIGRATION, IMPORTANT POLICY, INCOME SUPPORT, INDEXATION, INFORMAL ECONOMIES, INFORMAL SECTOR, INFRASTRUCTURE DEVELOPMENT, INTERNATIONAL LABOR ORGANIZATION, INTERNATIONAL TRADE, JOB CREATION, JOB DESTRUCTION, JOB DESTRUCTION RATE, JOB MARKET, JOB OFFERS, JOB OPPORTUNITIES, JOB SECURITY, JOBS, LABOR CODE, LABOR COMPENSATION, LABOR CONTRACT, LABOR DEMAND, LABOR FORCE, LABOR FORCE PARTICIPATION, LABOR LAW, LABOR MARKET FLEXIBILITY, LABOR MARKET OUTCOMES, LABOR MARKET PERFORMANCE, LABOR MARKET RIGIDITIES, LABOR MARKET RIGIDITY, LABOR MOBILITY, LABOR MOVEMENT, LABOR ORGANIZATION, LABOR PRODUCTIVITY, LABOR REGULATIONS, LABOR SUPPLY, LACK OF KNOWLEDGE, LEVEL OF EDUCATION, LOCAL LABOR MARKET, LONG-TERM UNEMPLOYMENT, MARKET ECONOMY, MARRIED MEN, MIDDLE INCOME COUNTRIES, MIGRANT, MIGRANT WORKERS, MIGRANTS, MIGRATION, MINIMUM WAGE, NATIONAL ECONOMY, NATIONAL UNEMPLOYMENT, NATIONAL UNEMPLOYMENT RATE, NATURAL RESOURCES, NET EMPLOYMENT, NET JOB CREATION, NUMBER OF HOUSEHOLDS, NUMBER OF WORKERS, OLDER AGE GROUPS, OLDER WORKERS, PENSIONS, PERFECT COMPETITION, PERSISTENT DISPARITIES, PERSISTENT UNEMPLOYMENT, POLITICAL SUPPORT, POPULATION GROWTH, POPULATION GROWTH RATE, PRESENTED EVIDENCE, PREVIOUS WORK, PREVIOUS WORK EXPERIENCE, PRIVATE FIRMS, PRIVATE SECTOR, PRIVATE SECTOR FIRMS, PRIVATE SECTOR JOB, PRIVATE SECTOR WAGES, PRIVATE SECTOR WORKER, PRIVATE SECTOR WORKERS, PRIVATE SECTORS, PRODUCTIVE EMPLOYMENT, PRODUCTIVITY DATA, PROGRESS, PUBLIC SECTOR JOB, PUBLIC SECTOR JOBS, PUBLIC SECTOR WORKER, PUBLIC SECTOR WORKERS, RATE OF GROWTH, REAL GDP, REAL INCOME, REAL WAGE, REAL WAGES, REGIONAL UNEMPLOYMENT, REGRESSION ANALYSIS, REMITTANCE, REMITTANCES, RESPECT, RETENTION RATES, RIGID LABOR MARKETS, RURAL AREAS, RURAL EMPLOYMENT, SECONDARY EDUCATION, SEVERANCE PAYMENT, SKILLED LABOR, SKILLED WORKERS, SOCIAL PROTECTION, SOCIAL SECURITY, SPOUSE, STATISTICAL ANALYSIS, TOTAL EMPLOYMENT, TOTAL WORKERS, UNEMPLOYED, UNEMPLOYED PERSONS, UNEMPLOYED WORKER, UNEMPLOYED WORKERS, UNEMPLOYMENT, UNEMPLOYMENT RATE, UNEMPLOYMENT RATES, UNSKILLED WORKERS, URBAN AREAS, URBAN POPULATION, VALUE ADDED, VULNERABILITY, WAGE DETERMINATION, WAGE DIFFERENTIALS, WAGE DISTRIBUTION, WAGE FLOOR, WAGE GROWTH, WAGE LEVELS, WAGE PREMIUM, WAGE RATE, WAGE RATES, WORKER, WORKER HETEROGENEITY, WORKER PRODUCTIVITY, WORKERS, WORKERS EXPERIENCE, YOUNG PEOPLE, YOUNGER WORKERS,
Online Access:	http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000333037_20110512234257 https://hdl.handle.net/10986/2986
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