Farole, Thomas C.

Person:
Farole, Thomas C.

Global Practice on Social Protection and Jobs

Author Name Variants

Farole, Thomas, Farole, Tom

Fields of Specialization

Trade, Investment, Competitiveness, Economic Geography, Special Economic Zones, Private Sector Development

Departments

Global Practice on Social Protection and Jobs

Last updated:December 17, 2024

Biography

Thomas Farole is a Lead Economist in the World Bank’s Social Protection and Jobs Global Practice, where he works on the intersection between jobs and productivity, trade, and private sector development. Prior to joining the Jobs Group, he was a senior economist in the Trade & Competitiveness Global Practice and country economist for Botswana. His recent articles have appeared in IZA World of Labor, The Journal of Economic Geography, and World Development. He holds a PhD in Economic Geography from the London School of Economics and Political Science (LSE), an MSc in Local Economic Development from the LSE, and a BSc in Economics from the Wharton School of the University of Pennsylvania.

Full item page

Publication Search Results

Now showing1 - 10 of 35

Towards a National Jobs Strategy in Kuwait
(World Bank, Washington, DC, 2022) Koettl, Johannes; Radwan, Ismail; Farole, Thomas; Sanchez-Reaza, Javier; Chartouni, Carole; Alaref, Jumana Jamal Subhi; Rivera, Nayib; Sundararaman, Venkatesh; Afif, Zeina; Dexter, Gharam Alkastalani; Ajwad, Mohamed Ihsan
This report is one of the main deliverables outlined in the legal arrangement of September 10, 2019, between the General Secretariat of the Supreme Council for Planning and Development (GS-SCPD) in Kuwait and the World Bank. A separate overview report is also available. The social contract in Kuwait is at risk. Kuwaiti citizens are used to the state providing public sector jobs, free education, free healthcare, and subsidized fuel to all citizens. These benefits have been bought and paid for using Kuwait’s oil revenues, however, the sustainability of the social contract has been questioned by three mutually reinforcing challenges. First, oil demand is projected to steadily decline the next few decades. This decline is partly the result of changing consumer preferences away from carbon-based fuel sources, and partly the result of increasingly cost-effective alternative energy sources becoming available. Second, with mounting fiscal deficits, the size of the wage bill for the government is a growing concern. Third, the needs in the labor market will continue to grow as Kuwait’s population is young and growing. Central to these structural challenges are challenges to Kuwait’s labor market. A growing number of young Kuwaitis are entering the labor market with high expectations of well-paid, secure, public sector jobs. In the private sector, employers are dependent on low-cost and largely unskilled foreign workers. The 2019 COVID-19 global pandemic, which has led to an oil price crisis and a global economic slowdown, has intensified the debate surrounding jobs challenges in Kuwait. These jobs challenges need to be addressed to ensure the sustainability of the economic growth model and avoid major social disruption. The government has asked The World Bank for assistance to formulate a National Jobs Strategy to help confront these challenges, based on evidence and best practices. Reforms are recommended in four areas, or pillars: (i) make the public sector more sustainable, (ii) improve human capital, (iii) support private sector growth, and (iv) build a social protection system. In addition, the jobs strategy covers two cross-cutting themes: behavioral economics, and monitoring and evaluation, also embedded in the four pillars. This introduction briefly explains the critical challenges facing Kuwait that require substantial changes in policy. The subsequent sections analyze the major issues of these four topics, with recommendations for policy change to improve sustainability and enhance incomes.
Putting the Green Back in Greenbacks: Opportunities for a Truly Green Stimulus
(World Bank, Washington, DC, 2021-07) Taheripour, Farzad; Chepeliev, Maksym; Damania, Richard; Farole, Thomas; Lozano Gracia, Nancy; Russ, Jason Daniel
Can countries reorient their productive capacity to become more environmentally friendly and inclusive? To investigate this question, this paper uses a standard input-output modeling framework and data from 141 countries and regions to construct a new global data set of employment, value-added, greenhouse gas emissions (disaggregated into carbon dioxide and non-carbon dioxide elements), and air pollution (including nine categories of air pollutants such as fine particulate matter multipliers from supply-side investments. The analysis finds that many of the traditional sectors in agriculture and industry have large employment multipliers, but also generate male dominant, lower skill employment, and tend to have higher emissions multipliers. It is in economies dominated by these sectors that trade-offs to a “greener” transition will emerge most sharply. However, the analysis finds substantial heterogeneity in outcomes, so even in these economies, there exist other sectors with high employment multipliers and low emissions, including sectors that are more conducive to female employment. In addition, the analysis finds a high correlation between industries that generate greenhouse gas emissions, which cause long-term climate impacts, and those that generate air pollution, which have immediate harmful impacts on human health, suggesting that policies could be designed to confer longer climate benefits simultaneously with immediate health improvements. The results confirm some of the findings from recent research and shed new light on opportunities for greening economies.
Managing the Employment Impacts of the COVID-19 Crisis: Policy Options for Relief and Restructuring
(World Bank, Washington, DC, 2020-07) Carranza, Eliana; Farole, Thomas; Gentilini, Ugo; Morgandi, Matteo; Packard, Truman; Santos, Indhira; Weber, Michael
This note discusses policy options for managing the employment impacts of the COVID-19 (coronavirus) crisis aimed at relief and restructuring. The note pays attention to the labor market and institutional context of most low and middle-income countries where informality is large and where existing institutions often lack mechanisms to effectively reach businesses and workers in the informal economy. The note covers complementary policies aimed, in the relief phase, at: 1) Helping businesses survive and retain workers; 2) providing protection for those who do lose their jobs and see their livelihoods significantly affected; and 3) facilitating alternative employment and employability support for those who are out of work (collectively known as active labor market programs, ALMP). The note further differentiates between these relief responses and the restructuring response when countries start to reopen for businesses and policies need to aim to support firms' and workers' transition to a "new normal", hopefully a "better normal" that supports a resilient recovery.
Jobs in the Horn of Africa: Synoptic Brief
(Washington, DC: World Bank, 2021-06-21) Sahr, Tove; Farole, Thomas; Viollaz, Mariana; von der Goltz, Jan
This note provides an overview of labor markets and job outcomes in the Horn of Africa. This background note was prepared for the Horn of Africa Regional Economic Memorandum. It provides an overview of issues related to jobs in the five countries of the region, Djibouti, Eritrea, Ethiopia, Kenya, and Somalia. It first discusses labor market characteristics, notably labor force participation, unemployment and underemployment,as well as demographics of the labor force. Secondly, it compares employment patterns, focusing on the type and sector of employment. Finally, it looks at the limited information available on jobs outcomes – notably, wage levels. It seeks to provides a relatively succinct synoptic summary of the common trends among the five countries as well as some distinct features. With the exception of Eritrea, the World Bank has recently analyzed jobs outcomes in all countries of the region.
Supporting Export Competitiveness through Port and Rail Network Reforms: A Case Study of South Africa
(World Bank, Washington, DC, 2016-01) Pieterse, Duncan; Farole, Thomas; Odendaal, Martin; Steenkamp, Andre
Transport and logistics infrastructure is a critical determinant of the competitiveness of a country's producers and exporters. Well-functioning transport and logistics infrastructure relies not just on hardware, but critically on the operating environment that emerges from the interaction between private sector operators; national policies and regulatory regimes; and, in many countries, state-owned owners and operators of core infrastructure. This paper looks at the case of South Africa, where constraints in access, pricing, reliability, and network interfaces, particularly in the port and rail network, are eroding the competitiveness of South African exporters. The paper draws on interviews with a wide range of exporters along with secondary research to examine South Africa's port and rail network, and explores the underlying factors contributing to these constraints, including chronic underinvestment, an inadequate regulatory environment, insufficient private sector participation, and weak regional integration. The paper concludes with a review of the reforms needed to deliver a more broadly accessible and competitive rail and port sector based on international case examples. It highlights the need for institutional reforms to promote competitive pricing; private sector participation to increase investment and improve service delivery; information and coordination to address market failures and improve access; and cooperation to improve intermodal, interregional, and institutional interfaces.
Special Economic Zones : Progress, Emerging Challenges, and Future Directions
(World Bank, 2011-08-01) Akinci, Gokhan; Farole, Thomas
Ask three people to describe a special economic zone (SEZ) and three very different images may emerge. The first person may describe a fenced-in industrial estate in a developing country, populated by footloose multinational corporations (MNCs) enjoying tax breaks, with laborers in garment factories working in substandard conditions. In contrast, the second person may recount the 'miracle of Shenzhen,' a fishing village transformed into a cosmopolitan city of 14 million, with per capita gross domestic product (GDP) growing 100-fold, in the 30 years since it was designated as an SEZ. A third person may think about places like Dubai or Singapore, whose ports serve as the basis for wide range of trade- and logistics-oriented activities. In this book, the author use SEZ as a generic expression to describe the broad range of modern economic zones discussed in this book. But we are most concerned with two specific forms of those zones: (1) the export processing zones (EPZs) or free zones, which focus on manufacturing for export; and (2) the large-scale SEZs, which usually combine residential and multiuse commercial and industrial activity. The former represents a traditional model used widely throughout the developing world for almost four decades. The latter represents a more recent form of economic zone, originating in the 1980s in China and gaining in popularity in recent years. Although these models need not be mutually exclusive (many SEZs include EPZ industrial parks within them), they are sufficiently different in their objectives, investment requirements, and approach to require a distinction in this book.
Bangladesh Jobs Diagnostic
(World Bank, Washington, DC, 2017-10-01) Cho, Yoonyoung; Farole, Thomas; Bossavie, Laurent; Aterido, Reyes
This Jobs Diagnostic presents the characteristics and constraints of the labor market in Bangladesh, identifies the objectives of the jobs agenda, and proposes a policy framework to progress toward them. This multisectoral diagnostic assesses the relationships between supply- and demand-side factors that interact to determine job creation, quality, and inclusion outcomes. Understanding the factors that influence jobs outcomes requires a holistic approach capturing issues such as access to markets, inputs, capital, technology, skills, and matching of supply and demand. Standard labor analysis tends to miss crucial aspects of the demand side of job creation, while growth diagnostics have no direct link to jobs. The Jobs Diagnostic thus intends to provide the comprehensive evidence base to support the development of a national jobs strategy that focuses on policies to foster an environment for more, better, inclusive jobs in Bangladesh.
The Capabilities Driving Participation in Global Value Chains
(World Bank, Washington, DC, 2016-08) Pathikonda, Vilas; Farole, Thomas
Global value chains have altered the nature of global trade and offer significant opportunities for developing countries to expand exports, access technology, and raise productivity. Policy makers rightly seek to understand what it takes to participate in global value chains. In practice, this means understanding what it takes to attract lead firms and upgrade to higher value-added activities. Recent literature has pointed to a range of underlying characteristics that may drive participation in global value chains. Using a modified factor-content methodology, this paper shows that proximity to markets, efficient logistics, and strength of institutions are among the most important capabilities. However, the paper also shows that each sector has a unique mix of capability requirements. Fixed structural characteristics limit the range of sectoral possibilities for a given country, but, by reducing policy-related gaps, a country may be able to increase its competitiveness for participating in global value chains. The paper applies the methodology to Southern African Customs Union countries, and demonstrates that, by filling gaps in underlying capabilities, these countries could increase participation in certain global value chain sectors.
Rethinking Lagging Regions: Using Cohesion Policy to Deliver on the Potential of Europe's Regions
(World Bank, Washington, DC, 2018) Goga, Soraya; Farole, Thomas; Ionescu-Heroiu, Marcel
As the World Bank’s 2012 Golden Growth report emphasized, the European Union, since its founding, has been a ‘convergence machine,’ generating wealth and a higher quality of life for the poorest in the 28 EU member states. More recently, the Growing United report highlighted that while the convergence machine still works, it is not working for everyone. And among the fault lines emerging in the convergence machine, regional inequality represents a potent threat to Europe’s economic well-being, and to its social and political cohesion. In this context, Rethinking Lagging Regions highlights the nature and implications of regional inequalities in Europe and recommends how cohesion policy can be leveraged to maximize its impact on lagging regions, and on the businesses and people in these regions. The report has several key messages: regional inequalities are high and likely to rise; Europe’s lagging regions are going in opposite directions, but face common challenges; cohesion policy can maximize its impact on lagging regions by explicitly targeting regional potential and equality of opportunity rather than convergence; cohesion policy priorities can be rebalanced to help deliver on regional potential; and delivery of regional policy needs to engage ever more deeply at the ground level. This report aims to contribute to the debate on the future of cohesion policy, with a specific focus on lagging regions. It calls for a further shift in the objectives of cohesion policy towards an increasingly ‘region-centered’ approach that aims to maximize potential in all regions, while seeking convergence of opportunities for individuals, no matter where they live.
Job Creation in the Private Sector: An Exploratory Assessment of Patterns and Determinants at the Macro, Sector, and Firm Levels
(World Bank, Washington, DC, 2017) Ferro, Esteban; Farole, Thomas; Michel Gutierrez, Veronica
Why do some countries create more jobs than others? To consider this question, in this paper we focus on one of the most basic relationships, between growth and employment. In practice, the private sector responds very differently to growth (and decline) across countries. Understanding the patterns and drivers of private sector decisions to expand and shed jobs may be important to guide policy approaches for job creation. This paper analyzes the output-employment relationship in the context of business cycles at three levels: the macro-economy; industry (in manufacturing); and firms. The results highlight major differences in private sector job creation responsiveness to growth across stages of development and economic structures, but a critical finding is that economies (and firms) where formal sector job creation was more responsive to growth cycles generated more jobs overall. In addition, results from both the macro analysis and the sectoral analysis suggests significant complementarity between capital and labor. Finally, the findings may help to frame a broad policy agenda for job creation, including: macro-economic fundamentals, responsive labor markets, access to finance, competition, and a facilitative business regulatory environment. These are not surprising, but nevertheless frame a set of issues that could be explored in further research.