Paper short abstract:

This paper uses mixed methods to explores a key component of firm-level productivity and productive capabilities of international export-oriented firms in the Ethiopian apparel sector - the training and development of local middle-level managers by both firms and government.

Paper long abstract:

Manufacturing exports from Ethiopia have increased sharply in recent years, driven by growth in foreign direct investment. Low wages and comparatively easy access to consumer markets mean the country is attracting labour-intensive apparel manufacturing. These investments are bringing firms linked into sophisticated global production networks into a labour market with limited available manufacturing skills. Key to the further expansion of Ethiopian light manufacturing is the ability of transnational producers to profitably serve the global lead firms that control these production networks by increasing their productivity.

This paper explores a key component of firm-level productivity, the training and development of local middle-level managers. In Ethiopia, most such middle managers in FDI firms are Ethiopian nationals with limited prior manufacturing experience. Middle-level managers develop skills through a mixture of education, formal training, and informal training acquired through work experience. Developing the skills needed to adopt the basic organizational capabilities required to ensure cost-effective production to tight deadline has become a key focus of company managements. At the same time, government industrial policy is struggling to provide relevant training at scale in a rapidly changing industry. We draw on an original dataset comprising both quantitative and qualitative data collected between 2016 and 2020 to provide a detailed analysis of how firms, governments and workers struggle to develop skills and maintain competitiveness in highly hierarchical global production networks. We then compare public and private initiatives in Ethiopia to the experiences of leading apparel producing countries in Asia.