In a nutshell
- Labor laws aim to protect workers and increase labor market efficiency.
- However, over-protective labor regulations may result in higher informality and unemployment, as well as in hurting outsiders (usually women and young workers).
- A balanced approach between flexibility in the labor market and security of workers is needed.
- Reforming social protection schemes and the introduction of unemployment insurance would protect workers rather than jobs and lead to more efficient labor markets.
![Labor Market Regulations: Job Security versus Labor Flexibility](https://erf.org.eg/app/uploads/2016/03/jackline-150x150.jpg)
Research Fellows
Jackline Wahba
Professor of Economics, University of Southampton, UK...