Macroeconomic Shocks and Employment in sub-Sharan Africa: Do Labour Market Institutions Matter?

Abidemi Adegboye, Alao-Owunna Ifeoluwa and Bank-Ola Folake R.
Additional contact information
Alao-Owunna Ifeoluwa: Department of Economics, Adeleke University, Ede, Osun State.
Bank-Ola Folake R.: Department of Economics, Adeleke University, Ede, Osun State.

Zagreb International Review of Economics and Business, 2022, vol. 25, issue 2, 97-118

Abstract: The effects of macroeconomic shocks and labour market institutions on employment in sub-Saharan African countries are examined in this study. Using a sample of 27 SSA countries for the period 2007 to 2018, both linear and interactive relationships are investigated. The results show that labour market institutions (especially in terms of wage flexibility) dampen the effects of shocks on modern employment but amplify the effects of shocks on informal employment in the sampled SSA countries. There is also evidence that shocks themselves (especially those emanating from the external sector) do not matter for a huge proportion of employment changes in SSA countries. Rather, the direct effects of shocks on employment are more profound in the formal sector. The study therefore concludes that reforming the informal sector will help to ensure the effectiveness of labour market institutions in mitigating the negative impacts of external shocks on employment in SSA.

Keywords: hiring and firing; sectoral employment; terms of trade; vulnerable employment; wage flexibility (search for similar items in EconPapers)
JEL-codes: E32 J21 J38 O47 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://doi.org/10.2478/zireb-2022-0017 (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:vrs:zirebs:v:25:y:2022:i:2:p:97-118:n:1006

DOI: 10.2478/zireb-2022-0017

Access Statistics for this article

Zagreb International Review of Economics and Business is currently edited by Jurica Šimurina

More articles in Zagreb International Review of Economics and Business from Sciendo
Bibliographic data for series maintained by Peter Golla ().