Xth African Regional Meeting: Decent work for Africa’s development: Signs of hope

Half of Africa’s population, over 300 million people, live in extreme poverty on the equivalent of US$1 a day or less – the highest intra-regional poverty level and the widest gap between rich and poor in the world. Strategies for reducing such poverty and closing this gap through a job-centred development agenda are the main items on the table at the ILO 10th African Regional Meeting, on 2 to 5 December, in Addis Ababa. What are the key issues facing Africa today and what can be done about them?

Africa today is a continent in search of decent work. It is shouldering a huge poverty burden and battling the barriers of an unfair system of international economic rules while tackling the massive challenges of job creation and poverty reduction.

And yet, there are signs of hope. African nations are forging a new dynamic development process founded on their own collective endeavours. Community-based projects are improving skills, spawning small enterprises, extending microinsurance and microfinance, eliminating child labour, and ending gender and other forms of discrimination.

Ratifications of the eight fundamental Conventions of the ILO are remarkably high. And in manufacturing, for example, inroads are being made against discrimination which shuts women out of the workplace.

The launching of the African Union (AU) in 2002, and the New Partnership for Africa's Development (NEPAD) in 2001, are among such dynamic new developments. The ILO report notes that the decision by the AU Heads of State and Government, in Maputo in July, to convene an Extraordinary Summit of Heads of State and Government on Employment and Poverty Alleviation in Africa, in 2004 in Burkina Faso, holds the promise of connecting the new regional initiatives to the daily experience of Africa's working families

African employers, unions and employment and labour ministers who will gather in Addis Ababa for the ILO Xth African Regional Meeting, know better than anyone the challenges of creating opportunities for women and men to work productively and earn a decent livelihood for themselves. What is the situation they face today?

Building on the Director-General's report, "Working out of poverty"

" Working out of poverty", is based on three fundamental points:

•  First, the poor do not cause poverty. Poverty is the result of structural failures and ineffective economic and social systems. It is the product of inadequate political responses, bankrupt policy imagination and insufficient international support.

•  Second, poverty is expensive. It hinders growth, fuels instability, and keeps poor countries from advancing on the path to sustainable development.

•  Third, there is another face to poverty. People living in conditions of material deprivation draw on enormous reserves of courage, ingenuity, persistence and mutual support to stay on the treadmill of survival. Simply coping with poverty demonstrates the resilience and creativity of the human spirit. In many ways, the working poor are the ultimate entrepreneurs.

Eradicating poverty is the biggest social challenge we face today, but it is also the biggest economic opportunity. Employers, workers, labour ministries and community leaders know better than anyone the challenges of creating opportunities for women and men to work productively and earn a decent livelihood for themselves.

From Working out of poverty , Report of the Director-General, International Labour Conference, 91st Session 2003, International Labour Office, Geneva, ISBN 92-2-112870-9.

The face of poverty in Africa today

In contrast to other parts of the world, Africa's poverty level is high and getting higher. Across all points in time, close to half the region's population - or about 300 million people - live in extreme poverty on US$1 a day or less. The percentage of poor people in sub-Saharan Africa is close to twice that of the world average of 24 per cent. In northern Africa, some 2.8 per cent of the population, or about six million people, live below the poverty level of US$1 per day or less.

Unemployment in formal sector jobs is increasing, from 13.7 per cent in 2000, to 14.4 per cent in 2002. This sector has been unable, over an extended period of time, to create long-term, sustainable employment, a challenge which will grow enormously since the regional labour force is expected to double in 25 years from its current 34 per cent of the population. What's more, sub-Saharan Africa has the second-fastest growing labour force in the world (2.6 per cent, on average, per year). These factors bring forward issues relating to low-income job security, poor conditions of work and similar concerns.

The report highlights that "unemployment is a serious problem in most African countries. However, equally if not more disturbing is the high incidence of underemployment characterized by low productivity and inadequate income. Poverty in most African communities is less the outcome of unemployment than it is of the inability of work to secure decent wages. This is particularly the case in the informal economy, the agricultural sector and rural economies."

The report also warns that the concentration of productive activity in rural areas should not be overlooked, and that rural-based employment and labour market initiatives may be bypassed in the haste to concentrate solely on urban-based activity.

Rural poverty is particularly acute among women and girls - many of whom work in the agricultural sector. Despite evidence that sub-Saharan Africa has a fairly large proportion of women in the labour force - in fact, higher than the international average - women and girls are frequently trapped in the lowest paid, least skilled and most precarious occupations.

Youth unemployment is another major concern. It is very high, representing nearly 80 per cent of the unemployed in some countries, while the female share of youth unemployment is consistently higher in all countries. In countries where data are available, it is estimated that only 5 to 10 per cent of new entrants into the labour market can be absorbed by the formal economy, while the bulk of new jobs is generated by the informal economy. Overall, about 55 per cent of Africa's population is under 18 years of age.

One of the most serious challenges to African policy makers today is the epidemic of HIV/AIDS. Within some countries, the overall labour force participation is beginning to show sharp declines. In South Africa, male labour force participation rate went down from 79.1 per cent in 1995, to 63.3 per cent in 2002; in Lesotho, it declined from 85.2 per cent in 1995, to 69.2 per cent in 1997, while in Botswana, the drop was from 83.5 per cent in 1995, to 60.1 per cent in 1999. If these trends continue and spread, the prospects for reducing poverty could worsen dramatically.

Seeking solutions

In order to halve poverty by the year 2015, as set out in the United Nations Millennium Development Goals (MDGs), Africa's economies will need to grow by 7 per cent a year, nearly double the current rate.According to the United Nations Economic Community for Africa (ECA), growth levels picked up from 3.2 per cent in 2002, to about 4.2 per cent in 2003. However, except in a handful of countries, it will be very difficult to reduce open unemployment, underemployment and poverty, unless growth perspectives improve dramatically.

"Although poverty has many facets, lack of access to income is one of the main determinants of household poverty and inequality," the ILO report says, noting that millions of Africans are caught in a "household poverty trap", spending up to 70 per cent of their income on basic "livelihood security"; i.e., food.

In response, recent political developments, such as the creation of the AU and NEPAD, together with global initiatives, have paved the way for a reorientation of the development strategies, with a new focus on productive employment and decent work.

"Together we must continue to build support for our basic premise that decent work is the main route out of poverty," the ILO report says. "Over the course of next year, the ILO and its tripartite constituents have the opportunity to help shape the African Union Extraordinary Summit of Heads of State and Government on Employment and Poverty Alleviation."

"African social partners and governments should make employment a priority item on the development agenda," the ILO report adds. "In the fight against poverty they need to make a long-term commitment to take common initiatives on all levels for a continuous increase in productivity. The foundations of a decent work approach to strategies for the reduction of poverty must be laid - and this is an urgent task.Priorities include employability, entrepreneurship, equal opportunity and employment generation, and can best be achieved through participatory consultation on national development policy making."

The ILO report says progress on four key objectives will provide a way of breaking out of the cycle of poverty:

• Ending the discrimination and social exclusion which marginalizes millions of African families and hamstrings economic development

• Raising the productivity and earning power of work on the farms and in the small businesses which are the heart of Africa's production system

• Uniting to win a better deal for the continent in the world trade and financial system

• Strengthening the mechanisms of social dialogue, representation and accountability at the workplace, at the national level and in the emerging new structures for regional development cooperation.

Social dialogue in African development

Strengthening social dialogue is a strategic objective of the ILO and contributes to the formulation, implementation, monitoring and adjustment of policies related to the world of work, including employment for development. Social dialogue enhances the capacity of countries to choose their own path towards growth and development. A number of Governments have found that social dialogue with employers' organizations and trade unions can help achieve a convergence of expectations about economic developments. Below are two examples of social dialogue programmes in Africa.

Since 1995, the ILO has worked with its South African constituents to gain access to justice for hundreds of thousands of ordinary workers, who were historically excluded from fair and effective redress for wrongs committed in the workplace. In the immediate aftermath of the apartheid era, this helped to ensure that the advantages of democracy were translated into fairer workplaces and the creation of a stable labour relations environment.

The ILO helped to establish the Commission for Conciliation, Mediation and Arbitration (CCMA) of South Africa, as an independent institution of dispute settlement. Apart from the impact on the lives of the individuals who benefited directly from these services - notably domestic workers, farm workers and other casual workers - the establishment of a dispute resolution system, which had the confidence of both business and labour, contributed to deepening democratic governance and promoting social, economic and political stability in the new South Africa.

The ILO, working with the representatives of government, business and labour in South Africa set up the institutional structures (Head Office in Johannesburg and offices in each of the nine provinces), trained over 100 full-time and 300 part-time conciliators and arbitrators, developed an electronic case management system and deals with over 120, 000 cases each year. For example, the incidence of strikes over wages was reduced by more than 60 per cent in its first year of operation.

The CCMA of South Africa is now a model for building similar institutions of dispute settlement in seven other countries in the Southern Africa region (Namibia, Botswana, Swaziland, Lesotho, Mozambique, Angola and Zimbabwe). The ILO is now building on its experience in South Africa to work with the social partners in these countries to develop the capacity, expertise, knowledge and skills to manage labour market conflict and enhance the prospect of peace and stability.

The Regional Programme for the Promotion of Social Dialogue in French-speaking Africa (PRODIAF) was launched in 1998, and is funded by the Belgian and French Governments. It helps a wide range of francophone countries strengthen tripartite cooperation structures at national and subregional levels, enabling the Government and its social partners to evaluate social dialogue and tripartite cooperation systems, and making improvements, changes and reinforcements where they are deemed necessary.

PRODIAF also focuses on institutional and organizational aspects of tripartite consultation and negotiation mechanisms, strengthening research activities and creating a network of African social dialogue practitioners/experts.

Between 1998 and 2003, the PRODIAF worked with 22 African countries on over 80 exploratory missions, national studies on social dialogue and tripartite cooperation, and sensitization and capacity building workshops. The interest expressed by major donors, such as the European Union within the context of the ACP/EU Cotonou Agreements, augurs well for the future of the programme.

Gender and poverty: Finding a way out

Today, poverty remains particularly acute for African women and girls - many of whom work in agriculture or in rural areas. Although sub-Saharan Africa has a large proportion of women in the labour force - in fact higher than the international average - women and girls are frequently trapped in the lowest paid, least skilled and most precarious occupations. What's more, gender discrimination remains a deep-seated impediment to growth and development. While the share of women's wage employment in the non-agricultural sector in sub-Saharan Africa increased from 18.9 per cent in 1990 to 28.6 per cent in 2001, male participation rates across the region were until recently above 80 per cent.

Globally, women have come a long way in the labour market, now representing half the labour force in some countries. Still, labour markets remain strongly segregated and an extremely high number of women are locked in jobs few men will take because of their low status and precariousness. Even for similar work, women typically earn 20 to 30 per cent less than men.

Are there solutions? Promoting more and better jobs for women has been shown to be essential for fighting poverty. The report, Decent work for Africa's development, argues that the emergence of small enterprises is increasingly generating meaningful and sustainable employment opportunities - especially for women. The emergence of micro-finance institutions (MFIs) also provides much-needed access to credit and savings outside of traditional banking schemes.

One such programme is the support programme for mutual benefit societies and savings and credit cooperatives (PASMEC), carried out jointly by the ILO and the Central Bank of West African States (BCEAO), involving grass-roots initiatives, such as village banks and women's savings groups. ILO Director-General Juan Somavia's report entitled, Working out of poverty, says microfinance is now a macro business in Benin, Burkina Faso, Cote d' Ivoire, Mali, Niger, Senegal and Togo, with over 300 MFIs serving 4.2 million members, representing one out of five households in the region.

The ILO Programme on Boosting Employment through Small Enterprise Development (IFP/SEED), and its team working on Women's Entrepreneurship Development and Gender Equality (WEDGE), are also working with women entrepreneurs, helping to build confidence and promote gender equality at all levels - from cities to villages. Says one woman who produces and markets soaps, "While others participating in trade fairs choose to have their photographs taken alongside influential men, I am selling my soaps and handing out my business cards to their wives."

YEN: A matter of youth

About 55 per cent of Africa's population is under 18 years of age - and are particularly hard hit by unemployment and poverty. Youth unemployment represents about 60 per cent of total unemployment in Africa, with the female share of youth unemployment consistently higher in all countries. The ILO estimates only 5 to 10 per cent of new entrants into the labour market can be absorbed by the formal economy, and that the bulk of new jobs will be generated by the informal economy. As a result, the "brain drain" of educated and highly skilled young people from sub-Saharan and North Africa, compounded by South-North migration of the youth labour force, is depriving Africa of its human capital and hope for the future.

Youthful energy, aspirations, and capacity for innovation are assets society cannot afford to squander. Continued youth unemployment poses high costs to economic and social development, perpetuates the inter-generational cycle of poverty, and is associated with high levels of crime, violence, crises, substance abuse and the rise in political extremism.

Through its role alongside the United Nations and the World Bank in the Youth Employment Network (YEN), the ILO views youth employment as an integral route towards meeting the Millennium Development Goals. With so many young people living in Africa today, creating jobs for them is essential in tackling the broader agenda on employment and the fight against poverty.

The ILO and its YEN partners, including the social partners and youth organizations, are working to provide innovative policy solutions to help countries develop national action plans on youth employment, as called for by the United Nations General Assembly Resolution on Promoting Youth Employment.

Egypt, Namibia and Senegal have stepped forward as lead countries ( Note 2) of the YEN in Africa, and many other African nations have expressed an interest in ILO assistance on youth employment.

Senegal has initiated the United Nations General Assembly Resolution on promoting youth employment, which was adopted with 106 cosponsors in December 2002. In Egypt, the ILO is assisting the Government to develop its National Youth Employment Programme, with technical support and expertise on youth employment policy. The Government of Kenya has created a stakeholder roundtable on youth employment, comprising government ministries, workers' and employers' representatives, and civil society groupings including youth organizations. The roundtable is working to harmonize national policies on youth employment by reviewing existing programmes, and mobilizing resources and support for entrepreneurship schemes aimed at young women and men.

The plenary session on Decent Work for Youth at the 10th African Regional Meeting will discuss the role the ILO social partners can play in broadening YEN activities on the continent. Youth employment will be discussed within the overall framework of the ILO Global Employment Agenda, setting the stage for acknowledgment at the highest political level of the importance of tackling youth employment in Africa, before the African Union ExtraOrdinary Summit on Employment and Poverty Alleviation in Africa, to be held in Ouagadougou, in 2004.

Social security: Campaign launch in Africa

The Global Campaign on Social Security and Coverage for All will be presented to African ministers, and workers' and employers' representatives at the 10th African Regional Meeting on 2 to 5 December 2003, in Addis Ababa, Ethiopia.

Extending social security coverage on a continent where up to 90 per cent of working people are engaged in informal employment represents a major challenge in the fight against poverty. In many sub-Saharan African countries, less than ten per cent of the working population have any coverage at all. At the same time, HIV/AIDS threatens the financial viability of already fragile social security systems.

Experience on the ground demonstrates that the situation can be improved. Tunisia increased health and pension coverage from 60 per cent in 1989, to 84 per cent in 1999. South Africa's tax-financed State Old-Age Pension (SOAP) reaches 1.9 million beneficiaries, about 85 per cent of the eligible population - thereby reducing the poverty gap for pensioners by 94 per cent. And in West Africa, micro-health insurance schemes rooted in self-help or cooperative movements are providing an increasing number of people with basic health-care coverage.

Under the auspices of the campaign, the ILO will seek to work with governments and the ILO social partners to define national action plans, support local efforts to extend coverage, share good practices, and raise the priority of social security extension on the development agenda for Africa.

Note 1: