Employment Implications Of Industrialisation In Developing Countries: A Survey

The expansion of industrial manufacturing alone cannot be expected to solve the unemployment and underemployment problem in most developing countries. A manufacturing sector employing 20 % of the labour force would need to increase employment by 15 % per year merely to absorb the increment in a total work force growing at an annual rate of 3 %. The required rate of increase of manufacturing output is even greater than 15 % if increases in labour productivity are taken into account.1 In the light of these orders of magnitude, the contribution of the industrial sector to employment growth over the last decade has been disappointing in many developing economies (see Table 1 ). Ina number of countries in Latin America and Africa, despite significant investments in manufacturing, employment in the sector grew less rapidly than population, and in some cases even declined in absolute terms.