Strategies for Job Creation In Extractives

Government strategies focused on direct employment tend to emphasize either quantitative targets (such as Ghana’s recent implementation of statutory minimum levels for the employment of Ghanaian nationals) or softer methods relying on consultation and facilitation (such as Norway’s requirements that oil and gas companies provide employment training and submit plans detailing their local employment efforts, without requiring companies to meet binding targets for employment  of Norwegian nationals).^[1]

Policies in support of the recruitment and development of domestic human capital can be grouped into three broad categories:

• Policies designed to increase the absolute and/or relative number of nationals employed in an organization or workforce. For example, in Angola, Decree No. 5/95 mandates that national and foreign companies can only employ nonresident foreign workers if at least 70 percent of the workforce is formed by Angolan nationals and the company employs more than five workers.^[2]

• Policies that promote the development of higher technical and managerial skills for national employees. For example, in Angola, Decree Law 17/09 requires companies who are engaged in petroleum-processing activities to annually submit a human resources plan and enter into a contract with the government to implement this plan. In Azerbaijan, this type of arrangement is negotiated in public service agreements on the percentage of national citizens that in different job categories over time.

•  Policies designed to restrict the number of foreign workers and the duration of their employment. These policies aim to promote local workforce recruitment and progression. For example, in Angola, Decree 6/01 establishes a policy for the recruitment of expatriate workers only upon “obtaining confirmation that no Angolan personnel duly qualified to perform the job required is available in the local market.”^[3]

These types of policies may result in supply bottlenecks in countries that have shallow labor markets or are new to extractives.

Although domestic jobs policies usually target direct employment, it is important to note that, in extractives, there is greater potential for indirect employment—. In other words, more people will be hired to supply the goods and services required by oil and gas and mining companies than will be directly employed by these companies.

Cooperative strategies, meanwhile, rely on collaboration between government and industry. Whether these focus on direct or indirect employment, they tend to be most successful if they also mobilize the active support of other interested parties, such as trade unions and civil society organizations, and involve the participation of lower levels of government. This approach involves assessing the various interests and resources of each potential stakeholder group, bringing these groups together to identify and foster points of alignment, and collaborating in the work of shifting practices and developing programs toward common goals.