Impact Assessment of Formal Employment in Madagascar

I&P and FERDI (Foundation for Studies and Research on International Development) carried out a study on the social and economic impacts of employment and explored the impacts of an employment contract in Madagascar. 280 employees were interviewed in 5 portfolio companies, covering several sectors, hierarchical levels and types of contractualization.

Download the executive summary: In English | In French

Download the complete study (in French)

Main findings: what are the impacts of formalization?

→ A higher salary to sustain the entire household

• Wages are 60% higher than the national average
• About 4 people on average per household

→ A greater inclusion in the labour market

• 23% of employees have signed their first employment contract
• 57% of employees experienced a period of unemployment before working in the company

→ Essential social benefits

• 56% of employees accessing for the first to an health insurance
• A first participation to the retirement system for 55% of employees

→ Integration into the financial system

• 80% of formal employees have a bank account (versus 20% of informal employees)
• 48% of formal employees obtained a bank credit (versus 6% of informal employees)