This report, produced as a background paper to the World Bank Systematic Country Diagnostic (SCD), provides a detailed overview of the Seychelles labor market. It emphasizes the relationship between changes to the overall structure of the economy and employment levels . An overview of the economy and the labor market is provided respectively, based on the 2011 and 2014 labor force survey (LFS) data. We then discuss employment across major themes, such as changes to employment levels by sector and skills type; migrant labor; and employment in the informal sector. We also discuss unemployment and wage levels using econometric evidence to investigate premiums earned according to age, education, skill, tenure or gender. Our analysis suggests that future economic growth in the Seychelles is dependent on increasing overall labor absorption levels in a manner which ensures that high quality employment opportunities grow at a sufficient pace to absorb the rising number of labor force participants. At the centre of this challenge must be the growing issue of youth unemployment, that if not suitably addressed, could thwart the future economic development trajectory of this island economy.
