Digital skills, gender, employment and wages in the Egyptian labor market

Abstract

Purpose This study examines the effect of digital skills on wages and employment in Egypt, with particular focus on gender differences. Design/methodology/approach The study uses the 2023 wave of the Egyptian Labor Market Panel Survey (ELMPS). Our empirical methodology uses several econometric techniques, including Mincer equations, quantile regressions, Heckman and Blau et al. (2024) selection models. We also do robustness checks to address endogeneity concerns. Findings This paper has three main findings: (1) Digital skills improve labor market outcomes in Egypt, with positive effects on wages and employment probability for workers. (2) Women get higher returns from digital skills than men. In wage equations, the digital skills premium for women is approximately 1.5 times greater compared to men. This effect is even more important for women in employment probability models. (3) These gender differences occur through several mechanisms. Conspicuously, digital skills help women access formal employment and improve their chances in the public sector. It also enhances their access to high-skill occupations. Originality/value This study provides novel evidence on the wage and employment returns to digital skills by gender in a developing economy characterized by occupational segregation and underrepresentation of women.