# SUMMARY

This paper uses a variety of sources from the current literature to review some of the more salient features of labor markets and employment in Ghana during economic decline and changes before and after the Economic Reform Program. We begin in Section 1 with an outline of the basic structure of labor markets in Ghana, identifying the critical segments, and the interrelationships between them. We discuss _inter alia_ the aspects of government policy which specifically impinge on theses segments. It is argued that in Ghana, as in most developing countries, the narrow view of labor market policy is inappropriate, since it focuses specifically on the formal sector which is a small part of the labor market. A more helpful view of labor market issues is obtained by including the self-employed, the wage earners in the informal sector as well as the formal wage employees in the scope of the discussion. However, the data on earnings and employment in the formal sector tend to be more comprehensive in these economies, and in any case the formal sector is a large part of the monetary or non-subsistence economy. Thus, after a brief review in Section 2 of the essential aspects of Ghana's macroeconomic evolution and policies in recent years, the discussion turns to the formal sector in Section 3. It focuses on the employment and wage implications of the phenomena decline and partial recovery of the Ghanaian economy, and pays particular importance to the relative performance of the private and the public sectors and to the changes in the differential in wage levels between them. We turn in Section 4 to the topic of the difference in wages between small and large firms within the manufacturing sector of Ghana. It is interesting to see that, even after a prolonged period of wage decline, which might be expected to lead to a squeezing of wage differentials of all kinds, the scale related wage differential continues to be as important in Ghana as in other developing countries. Some detailed data exist for the manufacturing sector in Ghana due to special enterprise surveys conducted by the Research Program of Enterprise Development (RPED) sponsored by the World Bank. These surveys, three waves spanning the years from 1991 to 1994 in a number of African countries, obtained data from enterprises and their employees covering the entire spectrum of sizes, ranging from micro to large firms. This material is especially useful for studying the wage structure in the manufacturing sector in Ghana in a comparative context. A brief review of the structure of the informal sector activities, undoubtedly the largest sector of employment activity of the poor, is given to complement the more comprehensive formal sector employment. In the following Section _5_ we utilize the three waves of data collected from a sample survey of households over the years 1987-91 (called the Ghana Living Standard Survey-- GLSS) to study another important aspect of the labor market-the relationship between education and earnings. Lastly, in Section 6 we turn to the larger issues of differences in the levels and distribution of earnings in the rural and the urban sectors of Ghana, and the related issues of labor market behavior and poverty. The treatment here is historical as we are interested in following the trends over time as they have evolved with the macro-economic development of Ghana. Section 7 concludes with the general findings of this paper and suggestions for further analysis to supplement the results reported in this paper; particularly we highlight gaps which could be filled through further analysis of the Ghana Living Standard Survey (GLSS) data sets. The appendices deal with role of labor in Ghana's economic growth using growth accounting and project poverty in Ghana up to 2000 using various growth projections based on Ghana CAS for 1997.