ILO says HIV/AIDS impact on African development 'underestimated'

BARCELONA (ILO News) - The economic and social impact of HIV/AIDS in sub-Saharan Africa is far more severe than previously thought and will seriously undermine the development prospects of affected countries, the International Labour Office (ILO) says in a new analysis released today.

ILO experts told the XIV International AIDS Conference meeting here that previous attempts by economists to measure the costs of HIV/AIDS in sub-Saharan Africa "are likely to be significant underestimates of the social and economic value of the losses of 'human capital' that are being experienced".

"The epidemic affects social and economic life in ways we have never seen before", said Franklyn Lisk, Director of the ILO's Global Programme on HIV/AIDS and the World of Work. "The main socio-economic impact of HIV/AIDS is its decimation of the labour force and the level and allocation of savings and investment. This portends a huge humanitarian disaster with dire economic and social consequences".

A new study by the ILO ¹ launched at the Conference shows that across all occupational sectors in sub-Saharan Africa it is becoming increasingly difficult to replace skilled as well as unskilled labour lost to HIV/AIDS. What's more, the study found that as AIDS affects public and private sector workers who provide essential services, many countries are increasingly unable to find the resources badly needed to sustain even current levels of economic development.

"Decades of gains in development, training, skills and education are being lost forever", Mr. Lisk said. "The belief that these losses can be replenished from a vast pool of unemployed or underemployed labour is a fallacy."

Here are some of the key findings of the study:

• The epidemic is eroding the capacity for development through its effects on labour supplies, saving rates, national security and social cohesion. As a result, social and economic development will be most adversely affected in countries with high levels of HIV prevalence, where death and illness will cause huge losses in labour. This will be compounded in countries where HIV infection rates increase with social and occupational status.
• Health care and education will be affected directly by the same problems of replacing lost labour and skills that afflict other sectors. In addition, the education and training systems are failing to make provisions to replace the current and likely loss of skills in the workforce.
• AIDS is preventing both men and women from providing their full contribution to development, maintaining the structure of families and to sustaining productive capacity over the longer term.
• The epidemic is also eroding the savings capacity of households, formal and informal enterprises and governments through its direct effects on flows of income and levels of expenditure. Over time this will lead to falling demand, reduced investment and output and declining per capita income ² . Governments are failing to amend or adapt their five-year development plans to take account of the loss of skills and labour.

Scope of the epidemic

The epidemic is primarily concentrated in the working age population (aged 15 to 49), placing a disproportionate burden on an age group with critical social and economic roles. In Africa, the epidemic places a greater burden on women who experience more infections at an earlier age than men, with a consequent greater loss of healthy years of life and a greater share of the burden of care.

AIDS killed an estimated 2.3 million Africans in 2001, and has caused a cumulative total of about 20 million deaths since the start of the epidemic, according to the United Nations Joint Programme on HIV/AIDS. UNAIDS reported an estimated 3.4 million new infections in 2001, and estimates that some 28 million Africans are currently living with HIV.

Some 50 million people will have died of HIV/AIDS before the end of the present decade, the report says, adding that assuming that about five people within each immediate family are affected for every person who dies, some 250 million Africans will be closely affected by HIV/AIDS within 10 years.

Efforts to address these onslaughts against African economies will have long-term implications because of the difficulty in training new workers, the loss of opportunities for on-the-job learning due to the deaths of more experienced workers and the increase in the number of children who must go to work, thus missing opportunities for education and skills training.

One of the most worrying developments is the severe impact of the epidemic on education in sub-Saharan Africa, worsening the performance of an already underperforming sector, the report says. Among secondary school teachers in Malawi, for example, the rate of excess mortality due to AIDS is nearly double expected mortality due to non-AIDS causes, while among primary school teachers, an additional 60 per cent die due to the epidemic.

"It is hard to see how the stock of human capital can be maintained given the erosion of capacity in the education sector presently underway", the report says. "The implications of this for sustainable development in the region cannot be assessed accurately given our present knowledge of the complex interactions that are involved. However, even the most optimistic assessment is that indicators of social and economic development are significantly lower as a result of the epidemic."

In the public sector, for example, overall mortality in some countries has risen by ten times over the past decade largely due to AIDS and will result in governments losing the ability to supply essential goods and services. In Botswana, for instance, increased mortality of healthcare workers is reducing the capacity to meet higher demands for care for people with HIV and AIDS. Meanwhile, among police officers in Malawi, the epidemic is having a severe impact on junior officers aged 20 to 40, thus affecting the quality of service and the structure of security.

In the informal sector, which in most African societies accounts for the majority of workers, especially in agriculture, data on the impact of HIV/AIDS is limited due to lack of research. However, studies in Kenya and the Côte d'Ivoire found that sickness and mortality due to AIDS resulted in the dramatic depletion of savings, the loss of key skills and organizational capacity and a fall of up to 50 per cent in food production in households where only one member was sick with AIDS.

Rethinking policy

The report says a "rethinking of policies and programmes are needed to reconsider current policies and adapt those to the new reality of a world characterized by AIDS". These include:

• Redefining the objectives of the education system to be more inclusive and less hierarchical and adaptable to the changing needs of economies. This may mean reallocating resources for higher education to primary and secondary schooling to create a new base of education and skills;
• Redefining attainable tasks in the health sector and realigning health training to meet the new demands of HIV/AIDS and provide new mechanisms of delivery for an increasing number of persons with HIV/AIDS;
• Seeking alternative ways of ensuring that traditional skills are made available to children, especially in rural areas, to offset the loss of knowledge and learning that has been passed down through generations of adults now lost to HIV/AIDS; and
• Developing new technologies to substitute for the increasing scarcity of labour, both skilled and professional as well as unskilled. This may require new ways of planning rather than relying on endogenous forces of product and capital markets which are unable to adopt rapidly enough to the changing realities of the African labour market.

The ILO report also called for greater involvement of both employers and organized labour in efforts against HIV/AIDS and for support to governments in assessing and mitigating the impact of the epidemic.

"There have been no consistent workplace programmes for AIDS", Mr. Lisk said. "We must remedy this by providing advice and technical assistance for workers and employers based on the ILO Code of Practice on HIV/AIDS launched at the UN General Assembly Special Session on AIDS last year. So far, the resources allocated to this effort have been pitifully inadequate. The international community and African leaders must work together to find the resources and the will to establish workplace policy and programmes across the continent."

1 Desmond Cohen, "Human capital and the HIV epidemic in sub-Saharan Africa", ILO/AIDS Working Paper 2, Geneva, 2002, ISBN-92-2-113238-2.

2 UNAIDS estimates that annual per capita income of half the countries of sub-Saharan Africa is falling by 0.5-1.2 per cent, and that GDP in the hardest hit countries may decline by 8 per cent by 2010.