WP 05/092 - Poverty, Inequality and Labour Markets in Africa: A Descriptive Overview

Haroon Bhorat

Date of Publication: 
March 2005

This paper examines, through the application of available data, the poverty, inequality and labour market challenges facing Sub-Saharan Africa (SSA). The paper illustrates that apart from levels of poverty and inequality that are inordinately high in SSA, the region is also beset with perhaps the more worrying problem of accounting for almost all of the world’s ultra-poor: namely those individuals living on less than half of the standard $1 a day poverty line. In addition we show that the both the level and nature of economic growth in SSA are not conducive to poverty reduction. In addition, the diluting effect of income redistribution through growth, suggests that much higher levels of income growth are required to maximise the impact on absolute and relative poverty levels in the region. The labour market analysis alludes to the rapid projected growth of the labour force in the region, hence further raising the importance of improving the character and level of growth rates on the continent. A caricature of the region where the dominant form of employment remains rural-based and at low skill levels, combined with burgeoning, but haphazard urban informal employment – is the underlying labour market descriptor of the welfare challengesfaced by the continent.

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