Labour Market Efficiency

The Global Competitiveness Report 2016–2017 compiled ten indicators that measure labour market efficiency. Below is a short description of each:[107]

1.Cooperation in labour-employer relations
[1 = generally confrontational; 7 = generally cooperative]

2.Flexibility of wage determination
[Wages generally set: 1 = by a centralised bargaining process; 7 = by each individual company]

3.Hiring and firing practices
Regulations allow flexible hiring and firing of workers [1 = not at all; 7 = to a great extent]

4.Redundancy costs (in salary weeks)
The cost of advance notice requirements, severance payments, and penalties for terminating a redundant worker

5.Effect of taxation on incentives to work
Taxes & social contributions reduce the incentive to work [1 = to a great extent; 7 = not at all]

6.Pay and productivity
To what extent is pay related to employee productivity? [1 = not at all; 7 = to a great extent]

7.Reliance on professional management
Who holds senior management positions in companies? [1 = usually relatives or friends without regard to merit; 7 = mostly professional managers chosen for merit and qualifications]

8.Country capacity to retain talent
To what extent does your country retain talented people? [1 = not at all; 7 = to a great extent]

9.Country capacity to attract talent
Does your country attract talented people from abroad? [1 = not at all; 7 = to a great extent]

10.Female participation in labour force
Ratio of women to men (aged 15-64) in the labour force | 2015

Egypt’s rankings in comparison with those of Morocco, South Africa and Nigeria are provided in the table below.

Table 5.35: Regional comparison: Labour market efficiency (Rank out of 138) (2016–2017)

Labour market efficiency indicator Egypt Morocco South Africa Nigeria
Value Rank Value Rank Value Rank Value Rank
Cooperation in labour employer relationships 4.1 96 3.7 122 2.5 138 4.2 86
Flexibility of wage determination 5.0 72 5.3 47 2.8 135 5.4 40
Hiring and firing practices 3.9 61 3.3 103 2.3 135 4.8 16
Redundancy costs, weeks of salary* 36.9 129 20.7 91 9.3 28 15.4 64
Effect of taxation on incentives to work 3.4 104 4.1 54 4.0 59 5.1 11
Pay and productivity 3.2 125 3.4 114 3.6 98 3.9 71
Reliance on professional management 3.1 133 4.0 84 5.5 21 4.8 33
Country capacity to retain talent 2.9 104 3.2 91 3.5 69 3.3 80
Country capacity to attract talent 2.7 103 3.4 68 3.6 53 3.7 50
Female participation in the labour force ratio to men* 0.31 133 0.34 132 0.81 69 0.76 83

Source: World Economic Forum, 2016[108]
Note: Values are on a 1-to-7 scale unless otherwise annotated with an asterisk (*)

Egypt performs worse than Morocco and South Africa on most labour market efficiency indicators and lags behind Nigeria on all indictors. The country ranks worse than all three of the other countries in seven of the ten labour market indicators.

The country’s lowest rankings (133rd) are for ‘reliance on professional management’ and ‘female participation in the labour force ratio to men’, as discussed in greater detail above.

Egypt’s top indicator is ‘hiring and firing practices’, for which it ranks 61st of 138 countries, well ahead of both Morocco (103) and South Africa (135), but far behind Nigeria (16). This suggests that hiring and firing workers is fairly easy from a regulatory standpoint, a fact that is illustrated by the frequent firing of striking workers discussed above.[109]

Ongoing development of HR practices and the profession

Egypt’s two major human resources associations are briefly discussed below.

Egyptian Human Resource Management Association

The Egyptian Human Resource Management Association is a non-government non-profit organisation devoted to the service of the HR profession. The Association offers its members opportunities to network, research and learning opportunities, training programmes and workshops addressing and a periodical newsletter.[110]

According to its website, the association, which was established in 2000, has over 230 members (HR mangers and practitioners). However, the association’s current activities are uncertain, since information on its website is out of date.


  • To promote the human resource management profession as an integral component of the economic development of the community-at-large in Egypt and throughout the region.


  • To gain global recognition as the leader and voice of the human resource management profession in Egypt and through the region.

Egyptian Association for Human Resource Development

The Egyptian Association for Human Resource Development was founded by members of the US-based Society for Human Resource Management (SHRM) in 2009. The association produces an online magazine entitled “The HRs” (available here: It also runs a regular of events that can be viewed on its website. The aim and mission of the association are outlined below.


  • To provide knowledge, skills, abilities, and competencies HR professionals need to address current and future problems.
  • Affiliate the association with other organisations, societies, associations and universities.



  • Educate, train, develop and certify HR professionals, so they can assist in the enrichment of their organisation’s competitiveness abilities. Form a group of top HR specialists to exchange knowledge and expertise of the profession. Thus create a platform where other HR professionals come together to improve on their knowledge of the HR profession and share best practices.
  • Country Profile
  • Introduction
  • Broad Economic Indicators
  • Currency and Exchange Rate
  • Competitiveness and Ease of Doing Business
  • Foreign Investment and Largest Companies
  • Foreign Aid
  • Country Strategic Framework
  • Summary of Economic Conditions
  • Implications, Challenges and Recommendations
  • Population
  • Living Standards and Poverty Levels
  • Healthcare
  • Implications, Challenges and Recommendations
  • Qualifications Profile of the Population and Workforce
  • Levels of Schooling and Basic Education
  • Technical and Vocational Education and Training
  • Tertiary Education
  • Innovation in Egypt
  • Implications, Challenges and Recommendations
  • Labour Force
  • Employment by Sector
  • Employment by Skill Level
  • Employment by Occupation
  • Labour Productivity
  • Unemployment and Job Creation
  • Expatriates, Immigrants and the Egyptian Diaspora
  • Wage and Salary Trends and Social Insurance
  • Industrial Relations Framework
  • Labour Market Efficiency
  • The Fourth Industrial Revolution
  • Implications, Challenges and Recommendations

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