Recently, Mozambique has suffered from the financial crisis but also from major natural disasters related to climate change that have affected national development. They created major opportunities for infrastructure investments that would make the country more resilient to climate change and could turn it into a development opportunity. Similarly, UNEP and ILO research on green jobs suggests that investments in energy efficiency, renewable energy, sustainable agriculture, forestry and other sectors could create large numbers of jobs and contribute to sustainable economic and social development.

Public investment, in particular in infrastructure and construction, may play a key role in this regard. Due to the high level of sectoral investment and their significant contribution towards growth and development, agriculture, mining and infrastructure sectors have the highest potential for creating job opportunities in Mozambique and considerably helping in reducing the current unemployment rate. In order to realize this objective, employment should be made central to both national and sectoral policies and practical measures should be adopted to optimize the increased use of local resources. Increasing the use of locally available resources also contribute towards local economic development through the production of marketable products and increased business activity.

Since early nineties, Mozambique has been practicing employment intensive investment (EII) in the infrastructure sector especially in the road sub sector.

Country Strategy

To analyze, through simulations, the possible impact of the economic crisis on Mozambique’s labour market (different groups of workers disaggregated by selected elements such as age groups, sex, regions, rural/urban) and in particular on the poor (by income, household groups). At a second stage, we would like to find out which would be the most effective public spending (public works, employment guarantee act, universal social protection, targeted cash transfer programmes) to socially mitigate the negative impact of the crisis.

This project is part of the above-mentioned major project (“Mainstreaming Employment Intensive Investment Strategies and Social Protection in Government Operations”) whose objective is to support the creation of an employment and social protection promotion unit within GoM. This unit will promote Mozambique to effectively utilize public investments, in particular in infrastructure, but also public spending for social protection in order to contribute to its developmental objective, improve the labour market situation and the situation of the poor in general.

This promotion unit can be promoted through the following project activities:

Collect relevant data and develop a concrete methodology, a dynamic Social Accounting Matrix (SAM), to evaluate the impact of mainly public investment, with main focus on infrastructure (roads), but also other sectors (mining, agriculture) on employment, poverty and other development objectives of the countries (e.g. MDGs). This methodology will also be used to assess the impact of public spending on social protection on poverty and income inequality.

The unit will start by using the developed methodology in the concrete case of an employment impact assessment study which may show a) results on employment of past investment decisions or b) provide information on future possible scenarios comparing various options of the use of (public) investment (e.g. capital versus labour-intensive) on employment (including green jobs) and related issues, such as the use of local resources, link to social transfer schemes, social protection in general resources allocation mechanisms, other development objectives. Target groups could be ex-combatants, or groups disaggregated by gender, age (youth) or income (poor households, working poor).

Capacity building of unit staff. The consultants will work and develop the methodology and the study in close cooperation with local unit staff (learning by doing). At the end of this project activity, local staff should be able to independently use the methodology.

Disseminate information on the results of the study (e.g. awareness workshop with important actors from the Government, donors, development banks, academia and others) and advocate through policy advice, based on the results of the study, the effective use of employment intensive approaches through all available media including media, workshops, networking, etc

Expected impact

The Government will have a flexible and user-friendly tool at its disposal and be able to use it on a regular basis in order to make effective decision on policy options (e.g. public works versus tax exemption for specific enterprises versus microfinances) with regard to:

  • Optimize the employment impact of public investment (or other public policies, e.g. industrial, agricultural policies)
  • Target effectively specific groups of workers (e.g. by gender, age groups, skill level)
  • Target effectively specific types of jobs and methods of production (e.g. green jobs, capital versus labour-intensive methods)
As a result, the employment impact of public decision will be optimized, which will contribute to integrate larger parts of the population into (more) productive employment and thus contribute to a more sustainable and inclusive growth path.