Narrowing wage gaps between the public and private sectors and better working conditions for recruiters are the two main policies that can help ameliorate the “biased labour supply situation” in Egypt, according to a study conducted by the Brookings Institute.
The “Designing youth employment policies in Egypt” survey said that if the monthly wage offered in the public sector is 90% (around EGP 900) higher than the private sector, then the probability of young Egyptians choosing to join the public sector would be 67% higher than their opting for a private sector offer.
The study surveyed engineering students who studied at Cairo University, El-Shorouk Academy, Ain Shams University, Mansoura University, Matareya Helwan University, Minia University, Modern University, British University in Egypt and the Higher Technology Institute in the 10th of Ramadan. The total respondents for the survey comprised 1,259,891 males and 368 females.
The study revealed that if the gap between the wages offered by the two sectors is narrowed to EGP 300, the probabilities of selecting jobs between the public and private sectors decrease to 6.4% among males and 15% among females. The recent increases in private sector salaries have resulted in widening the sector gap even further, the study added.
“An improvement in non-wage job attributes can also make private sector jobs more attractive than those in the public sector,” the report said, adding that the attributes involve better social benefits and an improvement in IT infrastructure.
The survey also pointed out that health insurance support can result in a significant rise in the private sector’s uptake by around 26% among males and females.
“Our findings revealed that with educational support during a contract, good IT infrastructure, and support for medical insurance, the respondents in both countries are willing to give up a section of their wages [for such benefits],” the report read.
The study findings also showed that young Egyptian males are not influenced by the workload when selecting a job due to their eagerness for employment.
According to the report, housing support was defined as an influencing factor among young Egyptians who seek overseas employment opportunities.
On the shortcomings of Egyptian employment, the research stated that the Egyptian economy is still unable to create demand for young labour. The report added that the educational system does not provide students with needed training and skills required by employers.
“The labour demand and supply mismatch combined with the rapidly growing number of new entrants to the labour market leads to a protracted transition from school to work for Egyptian youth,” the Brookings report said.
On Sunday the Ministry of Finance, in coordination with the Industrial Trade Council (ITC), launched its third annual employment fair. Minister of Industry and Foreign Trade Mounir Fakhry Abdel Nour has previously announced that 70 local and international companies would participate in the fair and will offer 16,000 job opportunities in various industrial sectors for Egyptian youth residing in Cairo, Giza, Qaliubiya and 10th of Ramadan.
The minister pointed out that the fair comes within the ministry’s strategic framework to provide technical training for workers who are employed in various production sectors, adding that the ITC offers different training programmes and vocational education.
