Cameroon’s Informal Labor Market

Abstract

Cameroon’s informal labour market largely harbours female workers, engaged mainly in low-productivity and low-paying jobs. We investigate the sticky-floor - a wider earnings-gap at the top end of the earnings-distribution and glass-ceiling phenomena - a wider earnings-gap at the bottom in the informal labour market as a whole and across its segments. We use the 2010 Cameroon labour market survey and a framework that enables us to account for selectivity bias, resolve the index number problem of the standard decomposition, and examine earnings differentials across the unconditional earnings distribution. We find compelling evidence of a sticky-floor phenomenon in the informal labour market manifested essentially among wage earners. Returns to experience mitigate the gender earnings gap at the mean, and 10th and 50th percentiles of the unconditional earnings distribution. Female workers have an unambiguous human-capital-based advantage over their male counterparts at the mean, lower tail, and median of the distribution.