Download - Mozambique – Labour Market Profile 2012
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Mozambique–LabourMarketProfile2012
ExecutiveSummary
Main Issues on the Labour Market
‐ Mozambique is one of the poorest and least developed nations in the world. At the same time growth has averaged 9% for a decade. The impressive growth has largely been in extractive industries and in particular the aluminium export. Growth is expected to accelerate much more, as Mozambique has large resources of coal and off‐shore gas, which are beginning to be extracted.
‐ The large growth has created few jobs, because they are in capital intensive extractive industries and much of the wealth does not reach the broader population. As example, of $1 paid to the state from the Mozal aluminium smelter and estimated $21 leaves the country.
‐ Mozambique also has the lowest average years of schooling in the world. The low skill level means that companies often import skilled labour, especially from Portugal where there is high unemployment. There is in particular demand for vocationally educated labour.
‐ Two trade union federations exists, OTM‐CS and CONSILMO. OTM‐CS was created by the ruling FRELIMO party and a common criticism of OTM‐CS is that it retains too close ties to FRELIMO. OTM‐CS has recently been acting more independent than in the past, by criticised the government for not being consulted on poverty reduction plans and for the INSS scandals.
‐ There are good working relations with the employers’ organisations and CONSILMO and OTM‐CS also cooperates.
‐ Compared to similar Sub‐Saharan African countries and the high rate of poverty in Mozambique, the minimum wage at $125 is higher in Mozambique.
Labour Market Developments
‐ Questions of how to handle foreign nationals working and investing in Mozambique has gained increased government focus in 2012. Foreign investors are often accused breaking the labour law leading to several industrial disputes, Chinese nationals were expelled for working illegally,1 a managing director and French national was almost expelled for alleged mistreatment of workers2 and quotas of foreign nationals in firms were established.
‐ Mediation of industrial disputes is getting more institutionalised, as mediation and arbitration centres have opened in all provinces in 2012. The centres are to resolve industrial disputes before they go to court.
‐ The INSS, which runs the main social security schemes, was rocked by corruption scandals in 2012, since much of the funds that should have gone to pensions had disappeared. Assets were freezed and top leaders were fired. OTM‐CS and CTA called for reform of INSS
‐ The food subsidy programme (PS) was replaced by a Basic Social Subsidy Programme (PSSB) for households with no adults able to work, and a public works programme, for households with an adult able to work. Benefits are to more than double to about 239 Metical per month ($8).
‐ The Public Sector Workers Union SINAFP has not yet been legalized. A draft law has been submitted to the parliament for approval. OTM expects that the law will be approved.
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Contents
Trade Unions ........................................................................................................................................................... 3
Trade Unions in Mozambique ........................................................................................................................................ 4
Employers’ Organisations ........................................................................................................................................ 5
Central Tripartite Structures .................................................................................................................................... 5
National Labour Legislation...................................................................................................................................... 6
ILO Conventions ...................................................................................................................................................... 6
Trade Union Rights Violations .................................................................................................................................. 7
Working Conditions ................................................................................................................................................. 8
Workforce ............................................................................................................................................................... 9
Unemployment and underemployment ...................................................................................................................... 10
Sectoral employment ................................................................................................................................................... 10
Migration ...................................................................................................................................................................... 11
Informal Economy ........................................................................................................................................................ 12
Child Labour ................................................................................................................................................................. 12
Gender .......................................................................................................................................................................... 12
Characteristics of the Working Age Population ....................................................................................................... 13
Social Protection .................................................................................................................................................... 15
General Economic Performance ............................................................................................................................. 16
Trade ..................................................................................................................................................................... 17
Trade agreements ........................................................................................................................................................ 17
Export Processing Zones ............................................................................................................................................... 17
References ............................................................................................................................................................ 18
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TradeUnions
Trade unions in Mozambique(2012) Number of trade unions 23
Dues (standard) N/A
Members of trade unions (OTM) 128,710
Trade union members share of labour force 1.13 %
Trade union members to waged workers 13.8 %
Female member share of trade unions (OTM) 25 %
Number of CBAs (OTM) 1,297
Workers covered by CBAs (OTM) 207,735
Share of waged workers covered by CBAs 22 %
Labour force (2011)3 11.3 million
(OTM‐CS) Organizaco dos Trabalhadores de Mocambique – Comite Sindical4
The Mozambican National Trade Union Centre (OTM‐CS) was established in 1976 as a trade union federation for all Mozambican workers, albeit with a very strong link to the ruling party, FRELIMO. In the mid 1980’s, OTM‐CS became officially independent and began to establish unions for the various sectors. OTM‐CS has 14 affiliated national unions. Not counting the unions not yet legally recognised, or the informal economy umbrella association associated with OTM‐CS, with approximately 60.000 members. OTM covers all provinces in Mozambique and is affiliated to ITUC.
OTM‐CS highest authority is the Congress, which convenes every five years. The Executive Secretariat, composed of four members including the General Secretary Mr. Alexandre Munguambe, is in charge of daily operations.
OTM‐CS has been through a range of restructuring exercises since the beginning of the 1990’s, both as part of becoming more independent from government as well as to strengthen the affiliated unions.
According to the Friederich Ebert Stiftung,5 OTM‐CS retains close ties to the ruling FRELIMO party.
The mission of OTM‐CS covers organising of workers in Mozambique and improvement of their living and working conditions, participation in tri‐partite negotiations with the government and the employers around changes in the labour law and negotiations of minimum salaries with the government and employers.
The Public Sector Workers Union SINAFP, which is affiliated to OTM, is in the process of being legalized According with a draft of law to legalize SINAFP, state officials who occupy positions of leadership, confidence and leadership, senior officials and entities named by the President, functions and diplomatic careers and inspection and agents with fixed‐term contracts are prohibited to be in unions, according to the proposal of law This standard does not cover employees with provisional appointment, retired, dismissed or expelled and on leave indefinitely and recorded.
The draft Law on Public Administration Unionization in Mozambique still excludes employees and agents assigned to the Presidency, the entities responsible for collecting taxes, foreign trade, the forces of defense and security, correctional services, the national service public welfare and the magistracy.
(CONSILMO) Confederacao Nacional dos Sindicatos Independentes e Livres de Mocambique
CONSILMO has four member organisations with a total of 106,000 members.6 CONSILMO was founded in 1992 as a breakaway union from OTM‐CS, due to the ties to the FRELIMO party. It is headed by Secretary General Mr. Jeremias Timana. It is involved in the CCT (tripartite working commission) at the national level.
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Trade Unions in Mozambique9
Members, Dues, Collective Bargaining Agreements (CBA) and Occupational Safety and Health committees
Trade Union / Trade Union Centre
Affiliation To national trade union
centre
Total Members (2012)
Female Members
Dues (share of
salary)
Number of CBAs
Workers covered by CBAs
Number of OSH com‐mittees at workplaces
OTM‐CS Organizaco dos Trabalhadores de Mocambique – Comite Sindical
128,710 32,066 1,297 207,735
CONSILMO Confederacao Nacional dos Sindicatos Independentes e Livres de Mocambique
SINPOCAF Port and Railways Workers Union
OTM‐CS 2,826 254 4,938
SINTIQUIGRA Chemical, Graphic and Rubber Workers Union
OTM‐CS 7,323 1,793 13,417
SINTIME Metallurgic and Energy Workers Union
OTM‐CS 9,923 1,010 17,124
SINTIA Sugar Workers Union OTM‐CS 21,816 3,928 30,385
SINECOSSE Commerce and Service Workers Union
OTM‐CS 11,492 4,823 23,408
SINTIMAP Marine and Fishing Workers Union
OTM‐CS 8,236 436 13,480
SNEB Bank Workers Union OTM‐CS 4,776 2,492 8,452
SINTAC Aviation and Communication Workers Union
OTM‐CS 4,116 1,348 5,475
SINTIC Cashew Nut Workers Union OTM‐CS 4,650 2,050 6,500
SINTIAB Food and Drinks Workers Union OTM‐CS 8,274 1,709 12,561
SINPEOC Dock Workers Union OTM‐CS 4,673 55 7,059
SINTAF Agriculture and Forester Workers Union
OTM‐CS 36,460 9,553 60,012
SINTESPGM Security and Private Guard OTM‐CS
SINTELMO OTM‐CS 2,145 645 2,678
SINAFP Public Sector Workers Union OTM‐CS (Affiliated, not legally recognised)
20,256
SINED Education Sector Workers Union 2000 1,970 2,246
ASSOTSI Association of Informal Economy Operators and Workers
OTM‐CS (Associated organisation)
SINTRAT National Union of Road Transport Workers
CONSILMO
SINTIHOTSI National Union of Workers in the Hotel Industry, Tourism and Related Industries
CONSILMO
SINTESP National Union of Worker of Private Security Companies and Guards
CONSILMO
SINTICIM National Union of Workers of Civil Construction, Woodworkers and Miners
CONSILMO
SNJ National Union of Journalists Non‐affiliated
SNP National Union of Teachers Non‐affiliated
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Employers’Organisations
(CTA) Confederação das Associações Económicas de Moçambique7
CTA the Confederation of Economic Associations of Mozambique, was established in 1996 as the Working Commission of Associations a few years after the end of the civil war. CTA changed its name in 1999. It is headed by President Mr. Rogério Manuel.
The mission of CTA is to create a business environment favourable to the development of the
private sector, and a strong employers’ organisation movement able to influence policies, be participatory, socially responsible, and promote economic competitiveness and quality of business.
CTA maintains a structured dialogue with the government and publishes several studies of sectors.
70 trade associations, chambers of commerce, federations and forums are members of CTA.
CentralTripartiteStructures
Mediation and Arbitration
Collective disputes are governed by the Labour Law.13 A dispute must be mediated by a body chosen by the parties in the dispute, or otherwise a Labour Mediation and Arbitration Commission. The parties can choose voluntary arbitration, whereas arbitration is compulsory in essential services, a broad definition that includes workers in the Export processing Zones. An arbitration committee is appointed, with three members, one from the parties in the dispute and one appointed by the mediation and arbitration body. Cases unresolved by mediation or voluntary arbitration are referred to the labour court.
Mediation is getting more institutionalised into labour mediation and arbitration centres, which were
extended to all provinces in 2012.8 The mediation and arbitration centre (COMAL) is extended to all the provinces and reports indicate that in 2010 there were 793 requests for mediation. 500 reached agreement, 84 were pending and 2.064 were in an impasse. In 2012, they were a total of 8847 cases from which 6357 have reached agreement, 985 are pending and 1505 are in an impasse. The figures show that in fact the body is functioning.9
Mediation is a compulsory step according to the Labour Law, however in 2011 the constitutional court declared this unconstitutional. The CCT has called for
the constitution to be amended so it can become compulsory.10
National Labour Advisory Commission (Comisión Consultiva del Trabajo ‐ CCT)11 The tripartite CCT analyzes and gives advice on: restructuring and development policies, participation of representative organizations of employers and workers and comments the ILO's standard‐setting instruments.
Other bi/tripartite organs4
- National Social Security Institute (INSS) - National training and professional institute
(INEFP) - NEPAD - PARPA - PARPA II - Resolution and Arbitration Forum - Mozambican deputy group
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NationalLabourLegislation
Constitution12
The constitution from 1990 guarantees the freedom of association and unions. It recognises to strike except in essential services and prohibits lockouts. The constitution also guarantees the right to work, fair remuneration, health and safety at work, equal pay for equal work. It prohibits forced and child labour. It also specifically mentions different industrial sectors and means of production.
Labour Law13
The Labour Law of 2007 sets general principles and regulates individual employment relations, such as for hiring, firing, working hours, remuneration, occupational safety and health, vocational training, social security and labour inspection. The law also regulates collective labour relations, by regulating and establishing rights of trade unions and employers’ organisations.
The Labour Law is the most important labour legislation. Several other legislations exists which regulates and sets standards and restrictions for the labour market.14
ILOConventions
Ratified ILO Conventions15
Subject and/or right Convention Ratification date
Fundamental Conventions
Freedom of association and collective bargaining
C087 ‐ Freedom of Association and Protection of the Right to Organise, 1948 1996
C098 ‐ Right to Organise and Collective Bargaining Convention, 1949 1996
Elimination of all forms of forced labour
C029 ‐ Forced Labour Convention, 1930 2003
C105 ‐ Abolition of Forced Labour Convention, 1957 1977
Effective abolition of child labour
C138 ‐ Minimum Age Convention, 1973 2003
C182 ‐ Worst Forms of Child Labour Convention, 1999 2003
Elimination of discri‐mination in employment
C100 ‐ Equal Remuneration Convention, 1951 1977
C111 ‐ Discrimination (Employment and Occupation) Convention, 1958 1977
Governance Conventions
Labour inspection C081 ‐ Labour Inspection Convention, 1947 1977
C129 ‐ Labour Inspection (Agriculture) Convention, 1969 Not ratified
Employment policy C122 ‐ Employment Policy Convention, 1964 1996
Tripartism C144 ‐ Tripartite Consultation (International Labour Standards) Convention, 1976 1996
Up‐to‐date Conventions
Working time C014 ‐ Weekly Rest (Industry) Convention, 1921 1977
Fundamental Conventions are the eight most important ILO conventions that cover four fundamental principles and rights at work. Equivalent to basic human rights at work.
Governance Conventions are four conventions that the ILO has designated as important to building national institutions and capacities that serve to promote employment. In other words, conventions that promotes a well‐regulated and well‐functioning labour market.
In addition, there are 71 conventions, which ILO considers “up‐to‐date" and actively promotes.
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TradeUnionRightsViolations
According to ITUC:16 Employers continued to ignore collective agreements, as an example at a cashew nut factory showed. There was concern about the increasing use of casual and agency labour, as employers tend to exploit their more vulnerable position and seek to keep unions at bay. There are good relations between trade unions and employers’ organizations at national level, whereas the local level suffers from employer hostilities towards
According to the U.S. Annual Human Rights Report:17 Workers exercised some of their rights in practice. For example strikes, were infrequent but did occur. Similarly, although the law provides for the right of workers to organize and engage in collective bargaining, such contracts covered less than 2% of the
work force. Furthermore, there were reports that many companies continued to engage in antiunion discrimination by replacing people at the end of contracts, dismissing workers for striking, and not abiding by collective bargaining agreements.
The country’s leading trade union organization, OTM‐CS, was widely perceived to be biased in favour of the government and the ruling party, FRELIMO, but during the year it acted more independently than in the past. For example, in April OTM‐CS criticized the government for not consulting with it on plans for measures to alleviate the rising cost of living, despite the organization’s membership in the tripartite forum on cost of living issues.
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WorkingConditions
Wages and earnings Monthly average, median and legal minimum wages
Source
Current Metical
2011 US
Dollar
Minimum wage in manufacturing (2012)
Club of Mozambique
18
3,585 125
% minimum wage to value added per worker (2012)
Doing Business
19
15 %
Wage Share Unadjusted (2009)
Global Wage Report
20
26 %
Growth of real average wage (2008‐2012)
15 %
Growth of real minimum wage (2004‐2011)
32 %
% of minimum wage to value added per worker denotes the minimum wage share of labour productivity. Reported as ratio of minimum wage to value added per worker in the Doing Business Report.
19
The Wage Share is the share of GDP that goes to wages and other forms of labour compensation. It is not adjusted for the self‐employed, and can therefore underestimate the amount of GDP that goes to workers, if there are many self‐employed in the economy.
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Mozambique has nine minimum wages in different industries, with the highest monthly minimum wage in Financial Services at 6,171 metical, and the lowest in Agriculture at 2,300 metical. The manufacturing industry had a minimum wage of 3,585 metical per month, and had seen a real minimum wage increase of 44% since 2008.18 The minimum wage is usually raised every year at the 1st of May.
According to the U.S. Annual Human Rights Report,17 a minimal liveable wage required to provide for a family of five was around $268, somewhat below the mandated minimum wage. Many employers are reported not to implement the new minimum wages. Health and environmental laws exists to protect workers, but these laws were not always enforced. There were significant violations of labour laws in several companies and industries.
The wage share of labour is medium for the Sub‐Saharan region. At 26% it ranks 7 out of 17 Sub‐Saharan countries.
With a monthly minimum wage of around $125 in the manufacturing sector, the minimum wage is still higher than many other African countries, where the national minimum wage tends to be around $40‐$80 per month.
According to the latest labour survey from 2004/05,21 many Mozambicans supplemented their income with secondary economic activities. Many had secondary activities (8.7%), with the highest among rural men (15%). Most were self‐employed without employers (75%), and secondary activities were most common in the sectors of agriculture (37%), trade & retail (30%) and the manufacturing industry (21%). The overwhelming reason given (90%) for secondary activities, was that it provided extra needed income.
A 2009 ILO survey of reported working conditions for urban workers, with the breakdown below. The survey shows that work is often in unsafe environments, many work either few or many hours, and many are not aware of their rights or the safety risks of their work.23 A comparable survey was carried out in Tanzania, and working conditions and awareness are either similar or better in Mozambique.22
Working conditions(2009)23
Physical work environment and risks
Physical hazards (% of workers who are exposed to the following hazards around 3/4 of the time or more)
Noises 27 %
High temperatures 18 %
Smoke, fumes, dust 31 %
Dangerous people (thieves, poachers and so on)
18 %
Being well informed of safety risks 44 %
Work and health
Work affects your health 32 %
Absent due to health problems (%, over the past 12 months)
18 %
Awareness of legal entitlements
Minimum wage 64 %
Working Time 59 %
Maternity protection 71 %
Weekly working hours
Short hours (less than 30 hours) 22 %
Long hours (more than 50 hours) 59 %
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Workforce
Men and women have the same employment rates, though women have a slightly lower rate than men at age 25+ and a higher rate in their youth. The lower employment rates for men in their youth would usually imply that young men are being prioritised for education and therefore not active on the labour market. Though women have lower education levels, their enrolment into schools is only slightly lower than men. Youth unemployment rates are also lower for men, so the difference is not because of more men being unemployment.
That women age 15+ have higher employment rates than men is unusual for most economies, and indicates that women are very active participants on the Mozambican labour market.
Mozambique has considerably more working poor than the Sub‐Saharan average. Consistent with its many working poor Mozambique had a small middle class, with only 7% living for $2‐4 a day and 2.6% for $4‐20 a day, compared to Sub‐Saharan Africa where 14% lived for $2‐4 a day and 10% for $4‐20 a day.24
Mozambique has experienced years of high growth and it is expected to increase, due to new coal and gas extraction. However, the growth has largely been in
extractive industries, which create few jobs compared to investment. As example, the Benga coal mine has an investment of 13.6% of Mozambique’s GDP, but has only created 150 direct jobs and a projected 4,500 jobs.25
Working Poor3 Age 15+
Share of workers
in total employment
Region 1.25 USD a day
2 USD a day
Mozambique (2008) 58 % 81 %
Sub‐Saharan Africa (2008)
45 % 68 %
Sub‐Saharan Africa (2011)
44 % 67 %
Working poor measures employed people living for less than US$1.25 and US$2 a day, as proportion of total employment in that group
Employment rates3 (2011), Age and Sex distribution
Sex Age Employment
rate
Male & female
Total 15+ 79 %
Youth 15‐24 59 %
Adult 25+ 90 %
Male Total 15+ 78 %
Youth 15‐24 54 %
Adult 25+ 91 %
Female Total 15+ 81 %
Youth 15‐24 64 %
Adult 25+ 89 %
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
15+
15‐24
25+
Male and female Female Male
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Unemployment and underemployment
Somewhat outdated information exists on unemployment and underemployment from a labour force survey of 2004/05. The unemployment rate was rather high at 19%. Unemployment was more common in urban areas, and in particular among the youth. Women were more likely to be unemployed than men, both in general and the youth. The unemployment number is very high considering the general poverty and lack of social protection in Mozambique, and likely covers persons, who have some mean of support.
The concept of underemployment does sometimes also include those who are employed below their skill‐level, whereas the measure for Mozambique is confined to time‐related underemployment, indicating those who involuntarily worked less than 40 hours per week.
Underemployment was more common in rural areas, because many rural men are underemployed, likely because of seasonal changes in activity.
The survey also showed that underemployed women tend to be in urban areas, whereas underemployed men tend to be in rural areas. Underemployment is about the same level for youth as for the total labour force.
Urban youth unemployment is a large problem. As with most other African countries, the formal sector produces grows to slow to absorb the estimated
300,000 young people entering the labour market each year, and many therefore end up in precarious or informal jobs.26
Interpretation of the open unemployment and employment rates as indicators of a well‐functioning labour market is problematic in developing countries. When unemployment is not an option where a person can survive, work of some sort has to be found, often casual and informal work. Unemployment should therefore be understood in relation to the strength of social safety nets, the prevalence of informal employment and how much of informal employment is underemployment due to few formal employment possibilities.27
Unemployment, youth unemployment and underemployment21 (2004/05)
Un‐
employment
Youth Unemployment
age (15‐19) ‐ (20‐24)
Under‐employment
Total 19% 37% ‐ 27% 13%
Urban 31% 57% ‐ 45% 10%
Rural 13% 26% ‐ 17% 14%
Male 15% 37% ‐ 23% 17%
Female 22% 37% ‐ 30% 8%
Sectoral employment
Employment (2003)3 & GDP share (2010)26 Sector & Sex distribution – (Graph without Agriculture)
Sector Male
employment Female
employment GDP share per sector
Mining and quarrying 37,200 4,600 1.5 %
Manufacturing 54,793 5,574 13.2 %
Electricity, gas and water 0 0 4.7 %
Construction 161,508 4,975 3.1 %
Trade, restaurants and hotels
332,755 225,219 17.9 %
Transport and communication
75,730 3,059 10.1 %
Finance, real estate and business services
265,744 133,191 7.0 %
Public administration, education & health
186,221 58,765 4.0 %
Other services N/A N/A 7.6 %
Agriculture 2,507,329 3,881,815 30.9 %
0% 5% 10% 15%
0 400,000 800,000 1,200,000
Male Female GDP share by Sector
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Agriculture is by far the single largest employment sector in Mozambique, employing around 80% of the labour force, though only contributing with 31% of GDP. The large difference between people employed in agriculture and the contribution to GPD is reflected in other sectors, where there is a much higher contribution to GDP compared to workers in the sectors.
It is far more common for women to be working in agriculture (90%) than men (70%). Outside agriculture, women find employment in trade, business services and public administration. All of these sectors have more men employed.
Unlike most other African countries, the GDP share of agricultural is growing at the expense of especially the service sector. Cereal yields have increased steadily since a low in 2005,50 though agricultural yields are otherwise reported to have been stagnant in the last decade and 95% of agricultural workers work on small
plots with little technology or access to extension services.28
Sectors Share of GDP50
Migration
At 1.2% of GDP, Mozambique receives about half of the amount of remittances than the Sub Saharan average. Considerably fewer people also migrate out of Mozambique at a rate of 1 out of every 5,584 inhabitants, however years of high growth has also attracted many migrants, which are deducted in the net migration.
The top three destinations for migrants are South Africa, Malawi and Zimbabwe.29
The high growth rates and shortages of skilled domestic labour have also created a demand for skilled foreign labour. With a certain historical irony, many unemployed Portuguese have moved to Mozambique to find jobs in the last couple of years.30
11,821 foreign nationals applied for work registration in the first nine month of 2012, and 11,000 in the same period in 2011.31
Migration50
Net migration (2006‐2010)
Mozambique ‐ 20,000
Net migration to average population per year (2006‐2010)
Mozambique ‐ 1 : 5,584 inhabitants
Sub‐Saharan Africa
‐ 1 : 2,048 inhabitants
Personal transfers i.e. remittances received, % of GDP (2011)
Mozambique 1.2 %
Sub‐Saharan Africa
2.6 %
0%
10%
20%
30%
40%
50%
60%
Agriculture
Industry
Services
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Informal Economy
The Friederich Ebert Stiftung estimates that only 5.1% of the total labour force is in formal employment.5 Most informal employment is in subsistence farming, which is a large sector as agricultural employment constitute 80% of total employment and self‐employed constitute 91%. Outside agriculture the informal sector is still the largest employer, and it grows at a rate of 7%‐8% per year.4 This is largely because the formal sector produces too few jobs to absorb the estimated 300,000 young people entering
the labour market each year, who therefore end up in informal jobs. The formal sector is estimated to be only about 700,000 jobs.
ASSOTSI is an informal workers association, which again is associated to OTM‐CS. With around 60,000 members, it is the largest single organisation associated to OTM‐CS. ASSOTSI is not an affiliated organisation of OTM‐CS like regular trade unions, but is in the process of becoming one, and it receives technical support from OTM‐CS.4
Child Labour
Child labour is common in Mozambique and at 22% it is slightly lower than in Sub‐Saharan Africa.
Child labour is higher in rural (25%) areas than urban (15%). Girls (24%) were slightly more likely than boys (21%) to be engaged in child labour. Older children at the age 12‐14 (27%), were also more likely to be engaged in child labour than younger at the age 5‐11 (21%).
The HIV/AIDS pandemic is a major cause of child labour in Mozambique, as children who have lost one or both of their parents are more likely to be engaged in child labour.32
Working children Proportion of all children in age group
Region Year Type Proportion
Mozambique33
(age 5‐14) 2008 Child labourers 22.2 %
Sub‐Saharan Africa
34
(age 5‐17) 2008
Children in employment
28 %
Child labourers 25.4 %
Hazardous work 12.7 %
Children in employment includes all children who conduct some kind of work, whereas child labourers is a narrower term without mild forms of work. Hazardous work is the worst from of child labour as defined in ILO C182.
Gender
As noted elsewhere in this report: Fewer girls enrol in schools than boys, especially in tertiary education, but the gender differences are smaller than the Sub‐Saharan average. Women have less education than men, though Mozambique has the lowest education level in the world. Slightly more girls are engaged in child labour than boys. Women have higher rates of employment than men, because more young women participate on the labour market. It is far more
common for women than men to be working in agriculture. Women have higher rates of unemployment, youth unemployment, but lower rates of underemployment, because many rural men are underemployed.
An Enterprise Survey from the World Bank in 2007 reported that 14% of full time employees were women, less than the Sub‐Saharan average at 21%.35
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CharacteristicsoftheWorkingAgePopulation
With only 1.2 years, Mozambique has the lowest of average schooling per capita in the world. It is in stark contrast to neighbouring countries such as Zimbabwe and Zambia, with averages of 7.3 years and 6.7 years respectively. Of those who have education, most have however completed primary education.
Undoubtedly, the 15 year long civil war which in 1992, and later political conflict between the FRELIMO and RENAMO parties has been a deterrent on enrolling into education. However even for a conflict affected the country, the education level is very low. The civil
war did destroy vital infrastructure including schools, but a lot of Mozambican’s also have no schooling because the Portuguese rule actively prevented schooling and therefore empowerment of the local population.
Women are underrepresented in all types of education, having less total schooling and a more unequal distribution of the education among women. The graph above shows the educational attainment of all Mozambican above 25 years, therefore gives a glance of the human capital of the labour force.
Enrolment in Primary, Secondary and Tertiary schools (2000‐2011)50 Total and Female, Mozambique and Sub‐Saharan Africa
Net enrolment is the ratio of children of official school age, who are enrolled in school to the population of the corresponding official school age. Gross enrolment is the ratio of total enrolment, regardless of age, to the population of the corresponding official school age. Gross primary enrolment is therefore sometimes higher than 100 %.
40%
50%
60%
70%
80%
90%
100%
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
Net primary school enrolment
0%
10%
20%
30%
40%
50%
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
Net secondary school enrolment
0%
2%
4%
6%
8%
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
Gross tertiary school enrolment
Mozambique , Total enrolment
Mozambique , Female enrolment
SSA , Total enrolment
SSA , Female enrolment
Highest level attained and years of schooling in the population36 (2010), Population 25+, Total and Female
Highest Level Attained Total Female
No Schooling 74.5 % 83.3 %
Primary Begun 9.2 % 6.4 %
Completed 12.6 % 8.6 %
Secondary Begun 1.5 % 0.5 %
Completed 1.6 % 0.7 %
Tertiary Begun 0.2 % 0.1 %
Completed 0.3 % 0.2 %
Average year of total schooling 1.2 years 0.7 years
Educational Gini Coefficient 0.80 0.87
Primary, secondary and tertiary is the internationally defined distinction of education. In Denmark these corresponds to grundskole, gymnasium & university.
The educational Gini Coefficient is similar to the Gini Coefficient, but instead of measuring the distribution of income in a population, it measures the distribution of education measured as years of schooling among the population.
37
0% 20% 40% 60% 80% 100%
Total
Female
No Schooling Primary ‐ Begun Primary ‐ CompletedSecondary ‐ Begun Secondary ‐ Completed Tertiary ‐ BegunTertiary ‐ Completed
14
Enrolment rates into primary education is higher than Sub‐Saharan Africa, as primary schools have are free and compulsory, though registration fees are required.
Enrolment into both secondary and tertiary education is much lower in Mozambique than other Sub Saharan African Countries, though no recent data exists for enrolment into universities. Only around 92% of students in secondary schools completed their education in 2008, limiting their skills at the labour market skills. Dropouts were mainly due to financial constraints.38
According to the African Development Bank,26 the low skills level of the labour force remains a significant issue both for employers who are unable to engage qualified labourers as well as for promoting a culture of entrepreneurship. The low education level has led some foreign companies to import labour, and the government has therefore set a quota on number of foreign workers per enterprise.
Domestic skilled labour is especially scarce in the booming extractive industries.39
Though still lower than the Sub‐Saharan average and with a too small output and outdated training
materials, vocational education and training is comparable better in Mozambique. UNESCO data record 34,176 pupils enrolling in vocational training in 2011,40 whereas The African Development Bank reports that the national Vocational Training Institute (IEFP) is turning out 156,000 per year.26
A National Authority for Professional Education (PIREP) is planned. It will establish professional education centres in the provinces, and will be supported by a new Professional Education fund financed through a 1% tax on private sector wages.26 The process is still ongoing, however there are training schools for the public sector, which are using the model designed by PIREP
Vocational Training50
Pupils in vocational training (2011)
Mozambique 34,176
Ratio of pupils in vocational student to all pupils in secondary education (Average 2006‐2010)
Mozambique
6 %
Sub‐Saharan Africa
7.4 %
Ratio of pupils in vocational training out of 15‐24 year olds (Average 2006‐2010)
Mozambique 0.7 %
Sub‐Saharan Africa
1.8 %
15
SocialProtection
All workers are entitled to social security in the Labour Law.13
Social protection in Mozambique has three levels:41
Compulsory social insurance is for formal private and public workers giving sickness allowance, relocation allowance, old‐age pension, disability pension, survivor’s pension, funeral benefit and maternity allowance. About 2% of the workforce is covered by this scheme.
Complementary social security is optional higher pensions for workers in the compulsory social insurance.
Non‐contributory Basic Social Security is transfers and welfare services to the most vulnerable. It involves two assistance programmes, a food subsidy programme to the elderly, ill or disabled, and direct support programme to those who require immediate assistance. In 2011, 252,842 households benefitted from the food subsidy programme. In 2012, the food subsidy programme (PS) was replaced by a Basic Social Subsidy Programme (PSSB) for households with no adults able to work, and a public works programme, for households with an adult able to work. Benefits are to more than double to about 239 Metical per month ($8).42 Three development schemes are also part of the basic social security. These are a micro credit scheme, with 5,000 beneficiaries in 2007, a labour market integration scheme with 3,000 beneficiaries in 2007 and a region support scheme, which supported 280 communities in 2007.
Few social protection mechanisms exist for the informal and self‐employed workers, which are small family or community run schemes. However, the social security law of 2007 aims to extend the compulsory social insurance system to self‐employed workers.14 The social security system is therefore open for informal or self‐employed workers. There is an addendum to the law of social security which entitles these workers to be part of the system. However, the
system is not yet well organised and therefore many of the people from the informal sector are not registered.
The Instituto Nacional de Segurança Social (INSS), which runs the compulsory scheme has been rocked by scandals of corruption. At least USD 8 million disappearing between 2002 and 2008,43 in 2012 the labour minister freezed INSS bank accounts,44 and the General Manager and the chairperson of INSS was fired for corruption,45 Both OTM‐CS and CTA has called for INSS reform.46
The ILO convention 183 on maternity leave protection has not been ratified. Following the labour law maternity leave is set at 60 days fully paid, as of 2007 the compulsory social insurance finances the benefits, according to the law on social protection.47
Public spending on social protection schemes (2006)
Public social protection expenditure, excl. health
2006 Metical 1.26 billions
2011 USD 55 millions
% of GDP48 0.7 %
per capita $ 2.6
per worker $ 5.5
of government revenue 2.6 %
Public health expenditure
% of GDP48 3.3 %
Coverage of contributory schemes to potential demographic49 Contributors to scheme (2008)
Life insurance 2.1 %
Disability 2.1 %
Old age pension 2.1 %
Old age pension recipient ratio 65+ 15.4 %
16
GeneralEconomicPerformance
Key Facts (2011)
GDP50
GDP per capita
50
(PPP)
GNI50
Human Development
Index51
Gini Coefficient (2008)
50
12.8 billion USD
982 USD
12.8 billion USD
0.322 0.46
192 of 201 countries
184 of 187 countries
116 of 156 countries
Doing business
52
Control of corruption
53
Government effectiveness
53
Rule of Law53
139 of 183 countries
‐0.41 ‐0.55 ‐0.56
124 of 212 countries
137 of 212 countries
142 of 212 countries
Mozambique is experiencing a boom in economic growth. Growth had for long averaged 9%, the financial crisis only decreased it to 6.3% in 2009, and growth was back at 7.5% in 2012.54
The long periods of growth has not been matched by job creation or reduction in poverty. With a GDP in per capita measured in Purchasing Power Parity at $982, Mozambique is a very poor country, and Mozambique is projected to stay behind the Sub‐Saharan average for years. Mozambique also has one of the lowest ranks in the world on the Human Development Index.
FRELIMO, the former Marxist liberation movement party turned towards market economy, dominates the political landscape. RENAMO, the former rebel army turned into a conservative political party, called supporters back to their old military base in 2012. Chief among RENAMO’s complains is that the newfound wealth is kept among the elite of FRELIMO.55
Inflation has been high for many years, but is projected to fall, and was indicated to be as low as 1.2% in September 2012.54
Inequality is increasing in Mozambique due to the increased growth. The Gini coefficient ranks Mozambique at a medium to lower end at 116 out of 156 countries.
The doing business indicator ranks Mozambique medium to low at 139 out of 183 countries. A high
ranking means the regulatory environment is more conducive to the start‐up and operation of a local firm. Mozambique scores high on starting a business and protecting investors, but very low on getting electricity. Mozambique also has medium to low ranks on the three Governance indicators, with a slightly better Control of Corruption.
GDP per Capita (PPP), trend and forecast56
Inflation, trend and forecast56
Gross fixed capital formation (% of GDP)50
0
500
1000
1500
2000
2500
30002000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
Current USD
Mozambique Sub Saharan Africa (excl. South Africa)
0%
5%
10%
15%
20%
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
Mozambique Sub‐Saharan Africa
0%
5%
10%
15%
20%
25%
30%
35%
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
Mozambique Sub‐Saharan Africa
17
Trade With an export of 22% and import of 34% of GDP, trade plays a medium role in Mozambique’s economy. Exports are dominated by aluminium coming from the Mozal smelter plant. The Mozal aluminium smelter was build in the late 1990s, and to attract foreign investment large tax exemptions were given to the investors. According to a report by three environment, dept relief and tax NGO’s,57
Coal extraction has begun in the Tete province and is expected to grow substantially in the coming years, as it is the largest untapped coal reserves in the world.
the tax exemptions mean that of every $1 being paid to the government from the plant, an estimated $21 leaves the country.
Newly discovered gas reserves are further expected to boost exports. When extraction reaches its full potential in 2018, an estimated 50 million liquid natural gas could be produced, which in the long term could almost double Mozambique’s GDP.58
However there is no guarantee that the increased income will benefit the wider public, as corruption is already common in Mozambique, many other African countries have experienced similar resource bonanzas with wealth benefitting the few, and the extractive industries are capital intensive industries which create few jobs compared to their investment.
25 Trade agreements Mozambique is in the 2000 Cotonou Agreement on development cooperation between EU and African, Caribbean and Pacific (ACP) countries, which reaffirms commitment to ILO’s Fundamental Conventions and includes provisions on cooperation on various labour and social issues.59
Since 2000, Mozambique has benefitted from the United States’ African Growth and Opportunity Act (AGOA), which is a Generalised System of Preferences. It allows duty and quota free access for some products. Mozambique can be removed from AGOA, if the United States deems that Mozambique among other human rights issues do not seek to uphold the ILO Core Labour Standards and have acceptable minimum wages, hours of work and occupational safety and health.
60
Export Processing Zones Due to the tax exemptions for the Mozal plant, it is similar to an export processing zone. According to ITUC, violations of collective bargaining agreements and anti-union discrimination occur. The right to strike is further undermined as work in the export processing zone is classified as an essential service, subject to compulsory arbitration in disputes. ILO only classifies groups such as hospital personnel, police, military etc, as essential services.
Trade and Foreign Direct Investment Exports61
(2011) Imports61
(2011) FDI flow62
(average 2006-10) FDI Stock61
(2011)
2.8 billion USD
4.2 billion USD
1 billion USD N/A
22 % of GDP 34 % of GDP 8 % of GDP
Products share of exports (2010)63
Mozambique's main export markets (2010)64
Animal products Vegetable products Foodstuff Mineral products Chemicals, etc. Plastics / Rubbers Leather & Furs Textiles Footwear Wood products Stone / Glass Metals Machinery / Electrical Transportation Miscellaneous Services
EU; 63%
South Africa; 20%
China; 3%
Zimbabwe; 3%
Others; 11%
18
References 1 Club of Mozambique, Mozambique expels 60 illegal workers from China, 22 June 2012 2 Club of Mozambique, Labour Minister reverses decision on "Maeva Case", 22 June 2012 3 ILO, Key Indicators of the Labour Market Database 4 LO/FTF Council 5 FES, South Africa Office, Trade Unions in Sub-Saharan Africa, 2012 6 ITUC, Trade Union Development Projects Directory 7 http://www.cta.org.mz/ 8 Club of Mozambique, Labour mediation centres operational by 2012, 30 May 2011 9 OTM-CS 10 Club of Mozambique, CCT Calls for Constitutional Amendment, 9 November 2012 11 ILO, NATLEX, Decreto núm 7/94 de 9 de marzo, por el que se crea la Comisión Consultiva del Trabajo 12 ILO, NATLEX, Constitución de la República de Mozambique 13 ILO, NATLEX, Ley núm. 23/2007 del Trabajo 14 ILO, NATLEX, Country Profile Mozambique, Basic Laws 15 ILO, NORMLEX, Country Profiles 16 ITUC, Annual Survey of violations of Trade Union Rights, 2012 17 U.S. Department of State, Annual Country Reports on Human Rights Practices, 2011 18 Club of Mozambique, Government approves new minimum wages, 19 April 2012 19 IFC, World Bank, Doing Business 2013, 10th ed. 20 ILO, Global Wage Report 2012/13 21 Instituto Nacional de Estatística, Inquérito Integrado à Força de Trabalho (IFTRAB 2004/05), 2006 22 ILO, TRAVAIL, National Profile of Working Conditions in Tanzania, 2009 23 ILO, TRAVAIL, National Profile of Working Conditions in Mozambique, 2009 24 African Development Bank, The Middle of the Pyramid: Dynamics of the Middle Class in Africa, April 2010 25 World Bank, World Development Report, Jobs, 2013, p. 200 26 AfDB, African Economic Outlook, Mozambique Country Note, 2012 27 Kucera D. & Roncolato L. (2008), Informal Employment: Two contested policy issues, International Labour Review, Vol. 147 (2008). No. 4 28 World Bank, World Development Report, Jobs, 2013, p. 191 29 World Bank, Migration and Remittances Factbook 2011 30 The Guardian, Portugal's migrants hope for new life in old African colony, 22 December 2011 31 Club of Mozambique, Number of Foreign Workers Increases Slightly, 8 November 2012 32 ILO, NORMLEX, Observation (CEACR) - adopted 2011, published 101st ILC session (2012), Worst Forms of Child Labour Convention, 1999 (No. 182) - Mozambique (Ratification: 2003) 33 UNICEF, Mozambique Multiple Indicator Cluster Survey 2008 34 ILO, Accelerating action against child labour, International Labour Conference, 99th Session 2010 35 World Bank, Mozambique Enterprise Survey, 2007 36 Barro, Robert and Jong-Wha Lee, April 2010, "A New Data Set of Educational Attainment in the World, 1950-2010." NBER Working Paper No. 15902 37 Calculation from based on Thomas, Wang & Fan (2001), with data sets fromBarro-Lee (2010) and Psacharopoulos and Arriagada (1986). 38 Nuffic, Alignment of higher professional education with the needs of the local labour market: The case of Mozambique, 2011 39 Club of Mozambique, Natural resources need skilled labour, 8 November 2012 40 UNESCO, Institute of Statistics 41 Centro de Informação em Proteção Social, Moçambique 42 ILO, GESS, Social Protection Floor in Mozambique, Summary, 8 September 2011
19
43 allAfrica, Mozambique: INSS Must Defend Contributors and Beneficiaries, 18 February 2010 44 Club of Mozambique, Labour Minister freezes INSS bank accounts, 20 June 2012 45 Club of Mozambique, Prime Minister sacks INSS chairperson, 13 August 2012 46 Club of Mozambique, Union and Employers call for INSS reform, 7 August 2012 47 ILO, TRAVAIL, legal database, 2011 48 ILO, GESS, World Social Security Report, 2010/2011 49 ILO, Social Security Department, Social Security Inquiry 50 World Bank World dataBank 51 Human Development Report, Global Report, Statistical Annex, 2011 52 World Bank, Ease of Doing Business Index 53 World Bank, Worldwide Governance Indicators 54 World Bank, Mozambique Overview 55 The Southern Times, Dhlakama back in the bush, 29 Oktober 2012 56 IMF, World Economic Outlook Databases 57 Friends of the earth, Jubilee Dept Campaign, Tax Justice Network, Whose development is it?, Investigating the Mozal aluminium smelter in Mozambique, 2012 58 Weekendavisen, Hede drømme om gas og kul, 11. januar 2013 59 Ebert & Posthuma, ILO, IILS, 2011, Labour provisions in trade agreements: current trends and provisions 60 http://www.agoa.gov 61 CIA, World Fact Book, 2011 62 World Bank World dataBank 63 MIT, Alexander Simoes, The Observatory of Economic complexity, What does Mozambique Export? 64 European Commission, DG TRADE, Bilateral Relations, Statistics