The global crisis and employment in Africa Shanta Devarajan World Bank

2 In the developing world, richer countries experience comparatively higher unemployment rates Source: ADI 2008/09

3

4 During economic cycles Contributing family workers (% of employed)

5 Wage and salaried workers (% of total employed)

6 Recent growth has not been accompanied by job creation Employment elasticity of growth (Kapsos 2005)

7 A fiscal stimulus for Africa? Needs to be externally financed With external financing, additional spending Need not be in sector that is worst hit by the crisis (e.g., primary commodity exporting sectors) Could be in sectors that generate jobs in the short run, but leave the economy more productive in the medium run E.g., infrastructure maintenance Policies to stimulate employment and competitiveness (investment climate, agricultural investment, SME finance) Safety nets only if well-targeted