June 15, 2018
Ghana launched its first comprehensive National Employment Policy in April 2015 with the aim of tackling the growing unemployment challenge in the country.
The core objective of the policy was to create gainful employment opportunities for the country’s increasing labour force, contribute to economic growth, promote national development, among others.
Previous policies have so far failed to significantly reduce the rate of unemployment in the country while the informal sector continues to contribute more to employment than the formal sector.
Over the last few years, Ghanaians have experienced several economic challenges including the rising cost of utilities, high rate of unemployment, currency depreciation, high levels of corruption, among others.
This backdrop has placed a huge responsibility on the New Patriotic Party (NPP) government, which assumed office in January 2017, with the promise to address most of the above challenges prior to its election victory.
Against this backdrop, in March 2017, the Institute of Economic Affairs (IEA) undertook a telephone survey to gauge the opinion of Ghanaians on what they considered to be the most pressing economic issues to be addressed by the government. A nationally representative sample of 1,641 respondents were interviewed using Random Digit Dialling (RDD).
The survey examined several key economic issues that citizens expected the government to tackle the most in 2017 and beyond including job creation, building infrastructure, ensuring economic stability, creating a friendly business environment and promoting agriculture.
Rate of unemployment
Findings of the ‘public expectations survey’ indicated that a majority of respondents (33 per cent) expected the government to give the most important priority to job creation in 2017. This comes ahead of the stabilisation of the economy (23 per cent), creation of a friendly business environment (20.1 per cent), promotion of agriculture (15.5 per cent) and the building of infrastructure (8.4 per cent) in 2017.
In fact, job creation was found to be the main concern of 37 per cent and 34.6 per cent of the 15-25 and 26-35 year groups respectively. The age groups highlighted comprised the youth who may have completed JHS, SHS or tertiary education and are unemployed. For the most part, individuals in the above groups have pinned their hopes and expectations on the government to create more jobs. On the other hand, 32.8 per cent of the 60 years and above group expected the government to prioritise agriculture.
The survey findings also shed light on an important trend – a strong positive correlation between the level of formal education and prioritisation of job creation by the government. Citizens with higher levels of formal education expected the government to deal with unemployment as a top priority. Those with tertiary education (41.2 per cent) and SHS/GCE/O-Level/A-Level education (42.1 per cent) expected the government to create more jobs.
On the contrary, those with no education preferred the government to promote agriculture (24.5 per cent), ensure economic stability (24.1 per cent) and create a friendly business environment (24.1 per cent) in order of priority.
Respondents with primary level education also prioritised economic stability (27.6 per cent) and a friendly business environment (28.7 per cent) with respect to the most important economic issues they expected the government to tackle.
Ghana’s economic growth has been mainly driven by stronger growth in the mining and construction industries, as well as the financial sector. However, these sectors create a limited number of direct jobs. The service sector has contributed more to formal employment since 2005,while the contribution of agriculture to employment generation has declined over the same period.
The key recommendation from the survey report is that concerted action is required to address youth unemployment. In fact, the government’s efforts must go beyond the current initiatives such as‘Planting for Food and Jobs’.
Measures aimed at simplifying procedures, cutting costs and constraints that limit the creation and development of private sector businesses – particularly start-ups and small-scale entrepreneurs – should take centre stage.Employment initiatives such as the development of entrepreneurial skills among high school leavers and those with tertiary education must also be considered. Overall, job creation is critical in addressing poverty and, therefore, requires urgent attention in policy formulation and action by the government.