The most important factor influencing the labor market in Eritrea is the GSE’s National Service program, which, in practice, due (the GSE claims) to a long-standing state of emergency, subjects a large portion of the labor force to indefinite government service, working at very low wages across a large swath of the employment spectrum and unable to pursue alternative employment on penalty of imprisonment. All university graduates require a release from National Service before they can legally pursue other employment opportunities.
There is no reliable data on unemployment. Foreign labor is mostly unknown, aside from the small number of multinational companies. Migrant labor, in the sense of Eritreans moving from place to place for work, is mostly restricted to the agricultural sector, and even there it is a small part of the labor force given the dominance of subsistence farming in the agricultural sector. Female participation in the economy is high.
While there are shortages of specialized labor in many sectors of the economy, particularly in the areas of administration, the international mining facilities are largely able to find enough sufficiently skilled workers; in many cases these are National Service employees seconded from a relevant ministry. Many small Eritrean companies blame National Service for the paucity of skilled employees available in the market. Leaving a National Service position without authorized release can result in imprisonment. Due to National Service, Eritrea is a Tier 3 country for Trafficking in Persons, which results in sanctions against the government.
The informal economy plays a significant role in the Eritrean economy, though there is no data to show how significant. Those who evade National Service are only able to work in the informal economy. Domestic work is completely unregulated.
According to the GSE’s stated policy, the large international mining facilities currently operating in Eritrea are required to hire Eritrean workers wherever possible and to offer training programs for Eritrean workers.
All workers have the right under Eritrean law to severance if removed from a job, regardless of the reason for removal (termination for cause, layoff, or resignation.) The amount of severance depends on the salary and the length of accrued service. Moreover, notice must be given any time an employment agreement ends, with some exception for malfeasance on either side, again determined by how long the employee has worked. There are no known official safety nets for those laid off for economic reasons. Officially, no labor laws have been waived in order to attract or retain investment, but as most large investments are completed through private negotiations between the government and/or PFDJ and the outside entity, it is impossible to know the exact nature of provisions of these agreements.
There is one legal labor union in Eritrea, the National Confederation of Eritrean Workers (NCEW). The NCEW engages in collective bargaining for those workers who qualify, but as most workers are in National Service, very few benefit. The NCEW also represents workers in labor dispute management. Eritrea has a Labor Relations Board which hears disputes, made up of seven members of the NCEW, seven members of the employers’ association, and one government official.
There have been no labor protests or strikes during the past year.
The use of those serving in National Service for civilian jobs, and the indefinite nature of that service, continues to pose reputational risks for organizations doing work in Eritrea. A Canadian company that used to run a mine in Eritrea was sued in Canadian court over accusations that it employed National Service workers; the case was settled confidentially out of court in 2020. An EU development project has come under fire after accusations of forced labor. There are a number of other areas (informal sector, child labor, minimum wage) where Eritrean law does not meet international standards. No new laws have been introduced in the last year, nor are any new laws expected.