After Textiles, Agriculture: Who's Next?
28 April 2006
Read by 2210 persons
Regular Creation and Chaotic Destruction
Is the employment question really well-posed in the face of new growth challenges? The sectors that provide the most jobs are themselves being restructured. The textile and clothing industry may overcome the contingencies of the dismantling of the Multifibre Agreement if it invests more, repositions itself in short circuits, provides better quality at competitive prices.
But will the sector be able to continue recruiting as much (it is the leading employer in industry with more than 200,000 people)? The cost of labor may remain affordable, and the proximity of Morocco is a definite asset.
However, the repositioning of textile companies involves much more machinery and management than "the human sewing machine". Moreover, in the first half of 2005, according to AMITH (Moroccan Association of Textile and Clothing Industries), an estimated 15,000 to 20,000 jobs were lost. As for agriculture, over this decade, it is the only sector to have lost jobs in absolute terms. Between 1990 and 2002, Morocco actually created 64,000 net jobs, mainly since 1998, "despite strong labor mobility, as evidenced by the scale of the gross creation and destruction figures" (650,000 and 586,000 respectively)... As a reminder, the Kingdom should create four million jobs by 2015 to stabilize its current unemployment level... Hence, probably this incessant search for this "Moroccan miracle".
FEMISE points out that creation is fairly regular: 11.8% between 1990 and 2002. But destruction is chaotic and almost as high: 10.6%. The explanation is tautological: destruction is linked to the economic situation, while creation is planned. Moreover, according to FEMISE data, it appears that more jobs are being destroyed, which explains the slowdown in net creation. In other words, it is necessary to create, but the company must survive for a relatively long time. However, the failure rate of companies less than five years old remains very high in Morocco. So there is a reconfiguration of the most important sectors: textiles and leather (46.7% of manufacturing employment in 2002), chemicals (19.4%), and agri-food (18.7%) have seen their relative contribution to total employment decline over the past decade. The electrical and electronics industries are seeing their position strengthen. The dynamism of job creation matches the increasingly important place of this sector. Between 1990-1995, the change in net job creation was -0.9%. Between 1996 and 2002, the change was 77.2%. "However, the sector's still modest share does not make it capable of taking over from the textile and leather sector in the short term," says the report.
And "apparently, Moroccan industry has not yet initiated a transition process towards a higher growth regime that would meet its employment constraints." It is dominated by branches employing low-skilled labor and producing little added value.
"The structure of employment is changing little. In 2002 as in 1990, nearly 51% of total employment is unskilled. The share of skilled jobs and supervision rates remain around 39% and 10% respectively. The stagnation is too long-lasting, even though Morocco has been reconfiguring its industrial strategy over the same period. This undoubtedly explains the pale and erratic growth performance (Source: FEMISE)"
L’Economiste 06/04/2006
Is the employment question really well-posed in the face of new growth challenges? The sectors that provide the most jobs are themselves being restructured. The textile and clothing industry may overcome the contingencies of the dismantling of the Multifibre Agreement if it invests more, repositions itself in short circuits, provides better quality at competitive prices.
But will the sector be able to continue recruiting as much (it is the leading employer in industry with more than 200,000 people)? The cost of labor may remain affordable, and the proximity of Morocco is a definite asset.
However, the repositioning of textile companies involves much more machinery and management than "the human sewing machine". Moreover, in the first half of 2005, according to AMITH (Moroccan Association of Textile and Clothing Industries), an estimated 15,000 to 20,000 jobs were lost. As for agriculture, over this decade, it is the only sector to have lost jobs in absolute terms. Between 1990 and 2002, Morocco actually created 64,000 net jobs, mainly since 1998, "despite strong labor mobility, as evidenced by the scale of the gross creation and destruction figures" (650,000 and 586,000 respectively)... As a reminder, the Kingdom should create four million jobs by 2015 to stabilize its current unemployment level... Hence, probably this incessant search for this "Moroccan miracle".
FEMISE points out that creation is fairly regular: 11.8% between 1990 and 2002. But destruction is chaotic and almost as high: 10.6%. The explanation is tautological: destruction is linked to the economic situation, while creation is planned. Moreover, according to FEMISE data, it appears that more jobs are being destroyed, which explains the slowdown in net creation. In other words, it is necessary to create, but the company must survive for a relatively long time. However, the failure rate of companies less than five years old remains very high in Morocco. So there is a reconfiguration of the most important sectors: textiles and leather (46.7% of manufacturing employment in 2002), chemicals (19.4%), and agri-food (18.7%) have seen their relative contribution to total employment decline over the past decade. The electrical and electronics industries are seeing their position strengthen. The dynamism of job creation matches the increasingly important place of this sector. Between 1990-1995, the change in net job creation was -0.9%. Between 1996 and 2002, the change was 77.2%. "However, the sector's still modest share does not make it capable of taking over from the textile and leather sector in the short term," says the report.
And "apparently, Moroccan industry has not yet initiated a transition process towards a higher growth regime that would meet its employment constraints." It is dominated by branches employing low-skilled labor and producing little added value.
"The structure of employment is changing little. In 2002 as in 1990, nearly 51% of total employment is unskilled. The share of skilled jobs and supervision rates remain around 39% and 10% respectively. The stagnation is too long-lasting, even though Morocco has been reconfiguring its industrial strategy over the same period. This undoubtedly explains the pale and erratic growth performance (Source: FEMISE)"
L’Economiste 06/04/2006
