Workforce and leadership characteristics in Mozambican manufacturing.

Author:Santos, Ricardo
Position::Policy Brief
 
FREE EXCERPT

FINDINGS

Firms that survived the economic downturn adopted restrictive human resources management, reducing the workforce and making it more flexible, which in turn made employment more vulnerable.

In 2017, manufacturing sector leadership appears both more satisfied and more inclined to support the training of their workers.

Entrepreneurs reveal significant aversion to risk, which will constrain their ability to invest, both in physical and human capital.

The 2017 Survey of Mozambican Manufacturing Firms builds on data collected in 2012 from surviving firms to trace how changing economic conditions have affected the development of firms over five years. The survey also takes an in-depth look at the human factor that plays a key role in firm performance: workforce and leadership characteristics.

When the previous round of the Survey of Mozambican Manufacturing Firms was implemented in 2012, the Mozambican economy showed positive signs of stable and consistent growth. Five years later, the country is facing economic difficulties. With the ongoing credit crisis and very thin external currency reserves, Mozambique has seen its currency devalue significantly and firms saw the market narrowing. Those still operating in 2017 have depended on their leadership and their management choices regarding human resources to survive.

The 2017 survey findings provide important insights about leadership characteristics of manufacturing firms, how owners and managers regard their labour force, and their reactions to the challenging economic environment.

While more educated than average, firm leadership is highly averse to risk

Based on the 2017 survey findings, the Mozambican landscape of firm leadership, overall, has seen changes.

* The share of firms led by women increased from 5% in 2012 to 12% in 2017. This occurred through succession in firms that survived and because women-led firms were relatively more robust to the economic downturn of 2015-16. Nonetheless, the share of women-led firms remains far less than half.

* Mozambican firm managers and owners demonstrate low levels of trust in other people and very high aversion to risk, with owners of microenterprises showing extreme levels of the latter. This is manifested in their market and management decisions. Owners and managers have low propensity to offer commercial credit to business partners, reducing the scale of what is a normal avenue for companies to manage their liquidity. Conversely, they also...

To continue reading

FREE SIGN UP