Wages and Income Distribution

Wages and Income Distribution

For several reasons, it is difficult to compare rural incomes with urban incomes. Agricultural workers earned income predominantly from the production of goods, rather than from the sale of labor. Much of this production was not marketed, and cash crops that were marketed were sold at prices that were, in effect, taxed by the government because of its pricing policies. By contrast, urban incomes were pretax incomes, and unadjusted comparisons exaggerate the difference between the two. In addition, urban workers often benefited from supplementary nonmarket sources of income, such as subsidized housing, access to credit on favorable terms, and rental income.

According to Ministry of Planning figures for 1974 (the most recent figures available in 1988), the group of workers whose salaries fell in the bottom 40 percent in the private sector received about 14 of total salary payments; the middle 40 percent received about 33 percent; and the top 20 percent received about 53 percent. Figures for workers in the public and parastatal enterprises (excluding the civil service) were similar: the group of workers whose salaries fell in the bottom 40 percent received 12 percent, the middle 40 percent received 32 percent, and the top 20 percent received 56 percent. In both sectors, the highest salaries were paid to expatriates, and the lowest incomes went to nonIvoirian Africans. For the civil service, the income distribution was considerably more balanced: the lowest 40 percent received 27 percent of income payments, and the top 20 percent received 35 percent. Regionally, incomes in the north lagged behind those in the south.

Salaries earned by non-Africans ranged from about twenty times the average African salary in the primary sector, to ten times the average in the secondary sector, to five times the average in the tertiary sector. In money terms, non-Africans usually received two to three times as much income as Africans in the same job classification; in addition, expatriates benefited from generous housing, travel, and educational allowances.

Since 1932 minimum wage and other worker compensation standards have been fixed. The Labor Code of 1952 established guaranteed minimum wages and working conditions, and the Advisory Labor Committee, composed of an equal number of employers and workers chosen by their representative bodies, was set up to recommend appropriate standards. The committee based its recommendations on the cost of living and the minimum subsistence requirements of various segments of the population. The committee then elaborated two minimum wage standards: the Guaranteed Minimum Agricultural Wage (Salaire Minimum Agricole Garanti--SMAG) and the Guaranteed Minimum Interprofessional Wage (Salaire Minimum Interprofessionel Garanti--SMIG).

Minimum wages have increased faster for nonagricultural workers. The SMIG rose from CFA F40 per hour in 1962 to CFA F58 per hour in 1970 and increased an additional 58 percent to CFA F93 per hour by 1974. In 1982 the SMIG was raised to CFA F191.4 per hour. By contrast, the SMAG rose only 20 percent to CFA F25 per hour between 1970 and 1974. In 1982 the SMAG was CFA F30 per hour. Most workers received wages substantially higher than the legal minimum based on scales determined by collective bargaining agreements or, in the absence of such agreements, by the government.

The government also determined other work rules. In 1988 the maximum work period was 40 hours a week for nonagricultural labor and 2,400 hours a year for agricultural labor. By law, all employers carried worker's compensation insurance. The labor code regulated labor practices, recruitment, contracts, the employment of women and children, and general working conditions such as paid holidays, sick leave, and medical care. The code also provided for collective agreements between employees and trade unions and for special courts to settle labor disputes.

As in most developing countries, measuring employment and unemployment was difficult because relatively few people were employed in the modern or formal economy, in which enumerating workers is easier; in the traditional economy, the concept of unemployment was almost meaningless. It was also difficult to determine the percentage of the population that was active in the labor force. In spite of these methodological problems, the rate of unemployment in the early 1980s was calculated to be 9 percent, with the highest rates in the Abidjan area.

By the end of 1987, the national unemployment rate was estimated to be 11 percent; the rate in urban areas was as high as 30 percent. The actual number of unemployed persons was estimated to be 600,000, although only 86,000 were officially registered with the Employment Office of Côte d'Ivoire (Office de la Main d'Oeuvre de Côte d'Ivoire--OMOCI). Contributing to the high rates of unemployment were a sharp increase in the number of high school and university graduates with inappropriate skills, migration of young people from rural areas, a continued high rate of immigration from neighboring countries, and reduced recruitment levels in the public, parastatal, and private sectors. Significantly, these problems were becoming more acute because the economically active population was growing 4 percent a year and was expected to reach 7.5 million by 1992.

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