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DATA ANALYSIS AND INTERPRETATION OF 2004 LFS

Lovemore Sungano Ziswa

Central Statistical OfficeZIMBABWE

Outline of presentation

Introduction to 2004 LFS Objectives of 2004 LFS Measuring informality in 2004 LFS(CSO) Brief findings of 2004 LFS Objectives of ILO analysis Measuring informality in the ILO analysis Main findings of ILO analysis 2009 LFS

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Introduction to 2004 LFS

the LFS is a component of the Household Surveys Programme designed to provide socio-economic indicators useful in monitoring living conditions as well as providing in-depth information on the labour force in Zimbabwe.

It has been previously carried out in1986/87, 1994 and1999.

The next LFS was due to be carried out in June 2009

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Objective of 2004 LFS

The primary objectives were primarily to provide information on:

the number of people classified according to their activity status

the size and characteristics of the economically active population, that is, the employed and the unemployed.

the informal sector employment child labour conditions of employment and work living conditions in general

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Measuring informality in 2004 LFS

The informal sector( enterprise based concept) was used:

defined in the 2004 LFS as a private enterprise which is neither registered nor licensed and employed less than 10 employees. Households employing paid domestic workers and those involved in communal farming were not considered as informal sector enterprises.

Economic activity limited to main job Short reference period of seven days was

utilized to define employment. Prompt used to capture all ‘work’ that might

otherwise go unreported as employment:

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Brief findings of the 2004 LFS

the employment-to-population ratio for the working age population(15years +) was 79.03%

‘broad’ unemployment rate was 9.34% (i.e. under relaxed ICLS definition)

informal sector employed 13.25% of the employed population.

These findings were not generally accepted by both the public and the media due to their perceptions of unemployment

In light of the above CSO invited ILO to carry out an independent re-analysis of the 2004 LFS

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Objectives of ILO analysis

The broad objectives were to: derive statistics on employment and

unemployment provide data on informality in Zimbabwe

using the enterprise-based (informal sector) and job-based (informal employment) concepts

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Measuring informality in the ILO analysis(1) Enterprise-based concept:

Formal sector enterprises: employment in all production units that are registered or registered and licensed, as well as in all international organisations, local and central governments units and parastatals

Informal sector enterprises: employment in all production units that are not registered and are not local and central government or parastatals, with the exception of households employing paid domestic workers and those involved in communal farming

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Measuring informality in the ILO analysis(2)

Household production units: all domestic workers in private homes and all communal and resettlement farmers, and all those outside the formal sector who stated agriculture or paid domestic service as their main activity

Informal employment (job-based concept): According to ICLS (2003) definition with cross-

tabulation of status in employment and type of production unit (formal/informal/households)

As a proxy all ‘paid employee (permanent)’ were classified as formal employees and all ‘paid employee (casual/temporary/ contract/seasonal)’ as informal employees

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Measuring informality in the ILO analysis(3)

To complement this analysis ILO, carried out a Survey on Informal Employment in Glen View, Harare in collaboration with the Department of Geography & Environment Science, University of Zimbabwe in November 2006.

The main objectives of the survey were to:

listen to the experiences of informal workers

understand the perception of workers on their employment status compared to their statistical classification

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Employment rates According to ILO analysis, the employment rate for the

working age population was 78.0 % Minor difference is due to re-classification of some

domestic workers as homemakers (e.g. spouse of household head)

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Employment by status

Employed population by status in employment

29

9.2

0.5

24.8

12.6

23.9

11.9

6.1

0.1

43.6

14.7

23.7

0

5

10

15

20

25

30

35

40

45

50

Paidemployee(permanent)

Paid employee(temp) Employer Own-accountworker(communal)

Own-accountworker(other)

Unpaid family worker

Men Female

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Employment by main industry

Share of employed males and females by economic activity, 2004 LFS

58.8

72.2

14.1

4.5

27.1 23.3

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Male Female

Agriculture, hunting, forestry and fishing Industry Services

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Unemployment rates

According to ILO analysis, the unemployment rate of 9.4% (relaxed international definition)

Minor difference to CSO (9.34%) due to exclusion of some domestic workers who were re-classified as homemakers

High unemployment for women(12.2%) and youth(15.5)

Unemployment rates by age and sex, 2004 LFS(%)Age group15 -24 25-34 35-54 55-64 65+

Male 11.5 6.1 2.7 1.6 9.4Female 19.5 14.2 5.2 3.1 0.6Total 15.5 10 3.9 2.7 1.6

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Employment in the informal sector Informal sector estimated to employ 711,007

people (14%) compared to CSO’s 680,594 people (13.25%)

Difference do to slightly broader definition (e.g. inclusion of enterprises that are licensed, but not registered).

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Employment by enterprise sector

Distribution of the employed female and males by enterprise sector and branch of economic activity, 2004 LFS

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Female Male Female Male

Agriculture, hunting, forestry & fishing Non-agricultural

Formal Informal Hholds

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Informal employment

Informal employment accounts for 80.7% of all jobs

Distribution of employed persons by enterprise-based and job based concept of informality (%)

Enterprise-based concept

Formal employment

Informal employment Total

Formal sector 18.2 5.5 23.7 Informal sector 1.1 13 14 Households 62.3 62.3 Total 19.3 80.7 100 Source: Luebker, 2008

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Employment by informality of job and economic activity

Distribution of workers by type of job and economic activity

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Female Male Female Male

Agriculture, hunting, forestry & f ishing Non-agricultural

Formal job Informal job

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Informality and gender Gender inequality in the labour market as there is

uneven distribution by either concept of informality

Gender distribution of employed persons by concept of informality

Enterprise-based concept

Job-based concept of informality

Total employed persons

Formal sector Informal Households

Formal employment

Informal employment

Male 72.7 48.7 44.5 73.8 46.6 51.8 Female 27.3 51.3 55.5 26.2 53.4 48.2 Total 100 100 100 100 100 100

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Survey on Informal Employment Small-scale pilot survey with 400

respondents in the suburb of Glen View, Harare (cluster sampling of persons currently present). Main results: Majority of the employed respondents are

in the informal sector (81.6%) thus highlighting the importance of the informal sector in urban areas

Using the proxy approach under the job-based concept, informal employment is 85.3% and 87.7 % under the full operationalization.

The unemployment rate under the relaxed international definition was estimated at 17.2%.

High levels of perceived unemployment by respondents (53.6 percent under self-assessment).

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Disseminating the ILO results

The launch of the two ILO research reports was held on the 24th of July 2008 at a local hotel in Harare

Using this platform the invited stakeholders were informed that the employment statistics produced by CSO are valid & produced on the basis of the international statistical definition by the ICLS.

Observations from the ILO reports fed into discussions at a stakeholder workshop for the 2009 LFS which was attended by an ILO staff member.

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Changes for the 2009 LFS(1)

In 2009 LFS the informal sector is defined as all those private establishments that are not registered under national legislation and engaged in economic activities other than agriculture.

Informal employees are those employees who lack at least one of the following: Employer contributions to pension fund, or paid annual leave, or paid sick leave.

Additional question on existence of written contract with employer

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Changes for the 2009 LFS(2)

Re-introduction of a section on secondary job

Introduction of a section to capture social security

Alignment of definitions of status in employment to ICSE-93

Migration to ISIC REV 4 Enhanced tabulations and analysis

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