Wages and Compensation in Ethiopia’s Industrial Parks : Evidence from a Firm Survey
Jobs in exporting industries tend to pay higher wages than comparable jobs in firms focused on the domestic market. In Ethiopia, where the government has pursued an ambitious industrialization agenda, systematic data on wages in industrial parks ha...
| Main Authors: | , , |
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| Format: | Working Paper |
| Language: | English |
| Published: |
World Bank, Washington, DC
2021
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/834531617685578320/Wages-and-Compensation-in-Ethiopia-s-Industrial-Parks-Evidence-from-a-Firm-Survey http://hdl.handle.net/10986/35391 |
| Summary: | Jobs in exporting industries tend to pay
higher wages than comparable jobs in firms focused on the
domestic market. In Ethiopia, where the government has
pursued an ambitious industrialization agenda, systematic
data on wages in industrial parks has been scarce. This note
provides an overview of worker compensation using novel
firm-level data. The data shows that before the Coronavirus
disease (COVID-19) pandemic, a majority of industrial park
firms’ base salary exceeded the cost of basic needs as
measured by the local poverty line. When bonuses, overtime
pay, incentive pay, and in-kind benefits are taken into
account, the median monetary value of the total compensation
package is roughly fourfold of the cost of basic needs.
Nevertheless, there is significant variation in pay, both
within and between industrial parks with 21 percent of the
surveyed firms reporting a base pay below the local poverty
line. Much of the variation can be explained by the
different industries in which these firms operate. Although
lack of reliable data on the broader labor market makes
rigorous comparisons challenging, the survey data suggests
that base pay in the industrial parks is comparable with pay
in the labor markets surrounding the parks. |
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