Effect of Ill Health on Labour Market Earnings in Tanzania: Empirical Evidence

Abstract

Evidence shows the presence of many ill health cases in Tanzania, which in other countries have been identified as among key factors  affecting labour market outcomes. This study examines the effect of ill health on labour market earnings in Tanzania using panel  methods and data extracted from the National Panel Survey datasets. The fixed effect models of labour market earnings with chronic and  acute ill health conditions were estimated one at a time, and the results suggest that chronic ill health is significant and negative on  labour market earnings, while acute ill health is statistically insignificant. The study recommends policies that intensify efforts to improve  the health status of the population to increase labour earnings. It also recommends mainstream employment policy actions to support  those with partial work capacity from incurable ill health conditions to take up jobs and earn income.