The Banking Executive Magazine - January 2022 Issue

The Labor Market in Egypt Average wages vary greatly in favor of sectors of building and construc- tion, financial intermediation, and insurance. The latter has the highest average weekly wage by more than 3 times than production sectors such as manufacturing and agriculture. Average wages/working hours also decrease in sectors that are most vul- nerable to crises, such as tourism and wholesale and retail trade, falling below the general average by about 40% and 18%, respectively. Economic growth patterns have long been characterized by its non-inclu- siveness, especially in the aftermath of crises. As can be seen from Figure 3 below, the labor market response, represented in employment rates, lags behind the economic growth re- covery point. This indicates a decline in the Egyptian economy's ability to adjust to the developments in the labor market and absorb the unem- ployed after crises. The share of public sector from em- ployment reached about 25% of the workforce in 2006 compared to 26% in 2012. Employment rate and growth rate declined by 2.7% annu- ally during the period between 2006 and 2012. The formal waged em- ployment in the private sector wit- nessed a decline during the period from 2006 to 2012 by 3.4% com- pared to 7.1% in the period from 1998 to 2006. Agriculture, manufacturing, building and construction, wholesale and re- tail trade accounted for the largest share of employment, followed by the transport and storage, food serv- ices and accommodation sectors during the fourth quarter of 2019. Higher-end jobs have witnessed a significant contraction in the labor market; in addition to the decrease in the share of professional and techni- cal jobs, especially since 2015. the BANKING EXECUTIVE 42 ISSUE 157 JANUARY 2022 Figure 2. Average working hours and wages on weekly basis, in economic sectors (2018) Figure 3. Economic growth rates and employment rates over the three decades