Growth and Employment in the Dominican Republic: Options for a Job-Rich Growth

IMF Working Papers, February 8, 2013

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Growth and Employment in the Dominican Republic: Options for a Job-Rich Growth

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Bibliographic details

• Authors: Umidjon Abdullaev, Marcello M. Estevão
• Published: February 8, 2013
• Series: IMF Working Papers
• DOI: https://doi.org/10.5089/9781475518573.001

Summary

• The Dominican Republic has posted high rates of output and productivity growth over the past 20 years, but labor market indicators have remained weak.
• Rapid productivity growth originates in a few sectors, while the bulk of job creation is concentrated in other sectors.
• The speed of job creation has not been enough to raise employment rates.
• Lackluster real earnings and still-rampant labor market informality suggest that most of the new jobs are of low quality.
• Low real wages and low labor force participation imply a need to raise market wages above fallback incomes to attract individuals to the labor force.
• Full text also available in Spanish.

Key findings and diagnostics

• Productivity growth is concentrated in a few sectors rather than broadly shared across the economy.
• Job creation is concentrated in sectors different from those driving rapid productivity growth.
• Employment rates have not meaningfully increased despite robust output growth.
• Real earnings are described as lackluster, and labor market informality remains rampant, indicating low job quality.
• Low labor force participation is linked to market wages being insufficient relative to fallback incomes.

Policy recommendations and options

• Raise market wages above fallback incomes to attract non-participants into the labor force.
• Improve education to enhance workers' skills and employability.
• Reduce product market distortions and pursue product market reform to improve allocation and job quality.
• Consider job-search assistance or a search assistance program as part of measures to improve employment outcomes.

Content in this bundle

• _wp1340 - References
  • _wp1340 - References (Markdown version)
  • _wp1340 - References (PDF)
• Crecimiento y empleo en la República Dominicana: Opciones para un crecimiento generador de empleo
  • Crecimiento y empleo en la República Dominicana: Opciones para un crecimiento generador de empleo (Markdown version)
  • Crecimiento y empleo en la República Dominicana: Opciones para un crecimiento generador de empleo (PDF)