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This paper attempts to explore how to estimate labour redundancy after the privatisation or restructuring of a state-owned enterprise. This paper estimates labor redundancy by comparing employment levels across enterprises with different degrees of state ownership.

The article finds that:

• if the state share of capital was brought down to zero, roughly half of the workers in the corresponding enterprises would be redundant. This is more than ten times the estimate by the current directors of the enterprises
• there is a wide dispersion of redundancy across sectors of activity
• there is a weak correlation between the estimated labor redundancy and twelve ad hoc indicators of profitability, productivity and labor cost

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