Deepening Integration in SADC - Fes-botswana.org

In order to harmonise the labour market policies and other
macroeconomic policies, a phased work plan reflecting priorities and
feasible macroeconomic policies should be elaborated.
While the overall policies framework are rather in the medium and
long-term processes, immediate interventions are needed to improve
the quality efficiency, and relevance of the current labour market policy.
In order to evaluate ex-ante the possible effects of ALMP, it is useful
to consider:
If and how the needs/problems to be addressed by the policy have
been assessed (this implies an analysis of the labour market in which
the policy will be operating);
If, according to the available theoretical models, the planned
interventions may answer the problems/needs of the (local) labour
market;
What are the expected direct and indirect, positive and negative
effects of the policy and the expected costs?
Theoretical justifications for the provision of labour marker derive both
from equity and efficiency reasons. Equity and redistributive reasons
are at the basis of targeting these policies to the most disadvantaged
in the labour market, as the lack of employment appears to be one of
the major pathways to poverty in Europe. Efficiency arguments are
based on the mobilisation of labour supply both in quantitative and
qualitative terms that may improve the functioning of the labour market
and increase productivity without increasing wage pressures.
According to economic theory, labour market policies may have
other indirect effects:
(i) Inactive individuals may be induced to participate, so that increasing
employment due to ALMP may not produce a decline in
unemployment;
(ii) Job search may be reduced during participation in these programmes
(especially in the case of training programmes, or temporary jobs in
the public sector) and
(iii) Wage pressures may increase if these measures are perceived as
reducing costs associated with unemployment.
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