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Economic & Sector Work :: Other Poverty Study

Job Creation in Mozambique : Is Labor Law Reform the Answer?

ABSENTEEISM ANNUAL LEAVE AVERAGE WAGES BANKS BARGAINING AGREEMENT BARGAINING POWER BARGAINING SYSTEM CASUAL WORKER COLLECTIVE BARGAINING COLLECTIVE BARGAINING AGREEMENTS COLLECTIVE DISMISSAL DEBT DEBT CRISES DEVELOPMENT ECONOMICS DISMISSAL DOMESTIC MARKET ECONOMIC ANALYSIS ECONOMIC CONDITIONS ECONOMIC DEMOCRACY ECONOMIC GROWTH ECONOMIC REFORM ECONOMIC THEORY EDUCATIONAL LEVEL EFFICIENCY OF LABOR EMPLOYEE EMPLOYERS EMPLOYMENT EMPLOYMENT AGENCIES EMPLOYMENT CONTRACTS EMPLOYMENT CREATION EMPLOYMENT EFFECT EMPLOYMENT GROWTH EMPLOYMENT IMPACT EMPLOYMENT OPPORTUNITIES EMPLOYMENT OUTCOMES EMPLOYMENT SECURITY EMPLOYMENT SIZE ENTREPRENEURSHIP EXPORT MARKETS EXPORT PROCESSING ZONES FACTOR MARKETS FIRING FIRING COST FIRING COSTS FIRM LEVEL FIRM SIZE FIRM SURVEYS FISCAL POLICY FOREIGN WORKERS FOREIGN-OWNED FIRMS FORMAL SECTOR WORKERS FREE TRADE GENERAL EQUILIBRIUM HIRING HUMAN CAPITAL HUMAN RIGHTS INCOME INDIRECT COST INDUSTRIAL RELATIONS INFLATION INFORMAL ECONOMY INFORMAL SECTOR INNOVATION INTEREST RATES INTERNATIONAL LABOUR ORGANIZATION JOB CREATION JOBS LABOR CONFLICTS LABOR CONTRACT LABOR COST LABOR COSTS LABOR DEMAND LABOR DISPUTES LABOR ECONOMICS LABOR INSPECTION LABOR LAW LABOR LAWS LABOR LEGISLATION LABOR MANAGEMENT LABOR MARKET LABOR MARKET FLEXIBILITY LABOR MARKET POLICIES LABOR MARKET REFORM LABOR MARKET REFORMS LABOR MARKETS LABOR ORGANIZATION LABOR REDUNDANCIES LABOR REGULATION LABOR REGULATIONS LABOR RELATIONS LABOR SUPPLY LABOR UNIONS LABOR-INTENSIVE PRODUCTION LABOUR LABOUR MARKET LAYOFFS LEGAL FRAMEWORK MACROECONOMIC CONDITIONS MACROECONOMIC EFFECTS MACROECONOMIC STABILITY MACROECONOMICS MANPOWER MARGINAL VALUE MARKET ECONOMY MEDIATION MIGRATION MINIMUM WAGE MINIMUM WAGES ORGANIZATIONAL PERFORMANCE ORGANIZED LABOR PAYROLL TAX PERMANENT EMPLOYMENT PERMANENT JOBS PERMANENT WORKERS POLITICAL ECONOMY PRIMARY EDUCATION PRIVATE ENTERPRISE PRIVATE ENTERPRISES PRIVATE FIRMS PRIVATE SECTOR PRIVATE SECTOR JOBS PRIVATIZATION PRODUCT MARKET PRODUCT MARKET COMPETITION PRODUCT MARKETS PRODUCTION PROCESSES PRODUCTIVITY PROFITABILITY PROPERTY RIGHTS PUBLIC ENTERPRISES PUBLIC POLICY RECOMMENDATIONS REDUNDANCY REORGANIZATION SAFETY SAVINGS SENIORITY SEVERANCE PAY SICK LEAVE SKILLED LABOR SMALL BUSINESSES SOCIAL COSTS SOCIAL PROTECTION SOCIAL SECURITY STAFF STRIKES TAXATION TEMPORARY JOBS TEMPORARY WORKERS TERMINATION TOTAL EMPLOYMENT TOTAL LABOR FORCE TOTAL WORKERS TRADE REFORMS TRAINING PROGRAMS TRANSPORT TRIPARTITE UNEMPLOYMENT UNEMPLOYMENT ASSISTANCE UNEMPLOYMENT COMPENSATION UNEMPLOYMENT INSURANCE UNEMPLOYMENT RATE UNION MEMBERSHIP UNIONIZATION UNSKILLED LABOR URBAN WORKERS WAGE DIFFERENTIALS WAGE EARNER WAGE EMPLOYMENT WAGE INCREASES WAGE LEVELS WORKER WORKERS WORKING HOURS
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World Bank, Washington, DC
Africa | Mozambique
2013-03-20T22:44:58Z | 2013-03-20T22:44:58Z | 2006-11

This paper analyzes the potential economic impact of changes to the labor laws proposed in 2006. The economic logic behind these reforms is reviewed, and the conditions under which the reforms could be expected to have the maximum impact on employment are isolated. Next, the experiences of selected developing countries which have undertaken similar reforms are reviewed, which showed the importance of initial conditions and economic trends outside of the labor market in ensuring a successful reform. Third, the main provisions of the proposed reforms are explained. The analysis concludes that given Mozambique s initial conditions, including strong demand from private sector employers for change, the scope of proposed reforms, and the potential for continued economic growth, the reforms should increase firms' profit margins, and as a result, a positive employment effect is possible in the medium term. The analysis also shows that although the reforms are deep compared with the starting point, even if reforms are enacted, Mozambique's labor market would still be classified as rigid by international benchmarks. The report concludes with a discussion of the possible social and poverty effect. In the short run, there is a danger of layoffs in some of the larger firms which had previously reported being overstaffed. If this happens, the poverty effect would certainly be negative in the short run. The concluding section notes that other countries have avoided these types of layoffs by introducing transition arrangements.

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