Employment in small‐scale manufacturing in Cairo: a socio‐economic survey

Abstract

One of the major problems in the economic development of Third World countries is the low growth rate of the secondary sector. Since the number of jobs created in industry is insufficient to absorb the increasing urban labour force, the service sector is rapidly expanding, particularly in the large metropolitan areas. This general rule, however, cannot be applied to the Greater Cairo Region. Here the service sector lost almost 4 per cent of the share of total employment between 1960 and 1976. During the same period industry and construction were able to increase their share of the labour force from 25 to 34 per cent, with manufacturing alone accounting for 26 per cent of total employment in the Greater Cairo Region. The majority of these jobs in manufacturing (55%) were supplied by private sector firms with an average work force of around five (GOPP, 1983: 1.15-16). Compared with the national total, Cairo accommodated 50 per cent of private manufacturing employment and about 61 per cent of the nation's artisans (PADCO, 1981: 156). Thus, small private manufacturing is not only centred in Cairo, but within the city it is the largest source of industrial employment. Since the late 1970s the rate of increase in the number of small-scale manufacturing establishments has accelerated in an unprecedented manner. The economic liberalization under the Open Door Policy (infitdh) and the general rise in demand, due to the massive influx of remittances from Egyptians working abroad, presented quite favourable sales conditions for small enterprises. In the lower-class quarters of Cairo, in particular, the number of workshops producing basic consumer goods for the local population has risen dramatically. So far, however, neither the extent of this development, nor the socio-economic situation of the labour force employed in this expanding sector of the metropolitan economy is known. What is the structure of the small-scale manufacturing enterprises? How is their labour force composed as regards social relations, age, origin, and place of residence? To what degree do the workers participate in international labour migration and what is its impact on the development of small-scale manufacturing? In order to find answers to these questions a socio-economic survey of small-scale manufacturing enterprises in Cairo was carried out by the author.