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06.11.2019 Opinion

Ghana’s Unemployment Rate Cannot Be 7.1%; Government Is Either Lying Or Sucks At Numbers!

By Amodani Gariba
Ghana’s Unemployment Rate Cannot Be 7.1%; Government Is Either Lying Or Sucks At Numbers!

In Ghana, unemployment for some time now has become a passionately debated issue and has since, dominated discussions on the media and influenced political party manifestoes. In fact, one of the key issues that affected the outcome of the 2016 general elections a great deal was unemployment. I must concede that there have been numerous attempts to tackle the canker; from stakeholders’ forums to policies from the government. However, it seems the quagmire is defying every antidote tailor-made for it.

The turnout of things has made us wonder whether the persistence of the problem is the result of a deliberate effort to keep some Ghanaians unemployed or it’s purely an issue of sheer incompetence on the part of our leaders. The unemployment rate amongst graduates, in particular, has skyrocketed in recent times.

According to theInstitute of Statistical, Social and Economic Research (ISSER) at the University of Ghana, about 10% of graduates find jobs after the first year of graduation. They noted that it could even take others up to 10 years to find employment.

Why You Should Doubt The Cited Figure For Unemployment Rate In Ghana

The figure for unemployment in Ghana comes with a slight variance depending on your source. Different departments have different figures but the difference is not that significant. The minister of Employment and Labour relations, Ignatius Baffour-Awuah, puts the unemployment rate in Ghana at 7.1 percent. I must admit that I have not carried out any survey to determine Ghana’s unemployment rate, so I do not have any definite figure with which I intend to dismiss the government’s. The purpose of this write-up is to prove how the government’s figures are wrong using simple mathematics and logical reasoning.

From basic economics, we know the unemployment rate in a country is given by the ratio of unemployed people seeking employment over the total labor force of a country, multiplied by 100percent. Ghana’s total labor force according to the Ghana Statistical Service (GS) is 13.6 million. To find the number of unemployed persons using the variables we know, we multiply the total labor force by the rate. This gives us a figure of 965,600 as persons of working age without jobs in Ghana. But the sheer insignificance of the number betrays the lie it is.

If this figure is something we should take seriously, then unemployment, particularly under President Nana Akuffo Addo’s administration should have been a thing of the past by now. I say this because according to Ghana’s Minister for Food and Agriculture, the government through its flagship policy of ‘Planting for Food and Jobs’ in 2018, created more than one million jobs.

Notwithstanding that, Ghana’s Vice-President, Dr. Mahmud Bawumia, at a program organized by the National Youth Authority at the University of Ghana claimed that additional 350,000 jobs have been created in the formal sector alone. If these were true, unemployment will not only be solved but it would have become necessary for Ghana to import almost 400,000 more people from neighboring countries to fill the vacant posts. But on the contrary, we are seeing many Ghanaians fleeing the country for the Mediterranean in search of greener pastures.

This government rode on the grave dissatisfaction of the people of Ghana to win the 2016 elections. People voted for this government with the hope that the ills of the last government will cease. Almost three years into the reign of this government, the way things have been steered suggests that not much has been done to address the issue of unemployment.

Unemployment Is Bad, But Underemployment Is Worse

As a nation, we are so fixated on unemployment that we tend to miss out on the harsh realities of underemployment. I find underemployment worse than unemployment for the simple reason that the former is nothing other than crass exploitation. Underemployment is defined by the Miriam-Webster’s as the condition in which people in a labor force are employed at less than full time or regular jobs or at jobs inadequate with respect to their training or economic needs.

According to the Labour Force Survey conducted by GSS in 2015, about seven million Ghanaians (6,830,267) were engaged in what it termed ‘vulnerable employment’. Vulnerable employment here means underemployment. Out of the number captured under underemployment, 843,194 were engaged in a subcategory known as ‘contributing family workers’ which virtually comes with no monetary gain, whiles the rest were engaged in what was termed as ‘Owned Account workers’. In all honesty, it does not make any sense for GSS to consider contributing family workers as employed.

Admittedly there are some self-employed workers who make more money than their counterparts on the government’s or Private Company’s payroll. But the thing is how many of such people are there? Market women, petty traders, street hawkers, petty farmers and many others who are all considered self-employed actually occupy the rock bottom of the pay hierarchy. This view is even more corroborated when one juxtaposes the level of poverty the majority of Ghanaians are facing.

According to the World Bank, a person is in extreme poverty if he/she depends on less than $1.9 a day. Going by this metric, one out of every three Ghanaians is living in extreme poverty. In a survey conducted by myjoyonline.com, more than nine million Ghanaians cannot afford 5 cedis a day, an equivalent of $0.94. Going by governments’ statistics, I cannot conclude that more than 9 million people in Ghana are not employed.

What I can, however, say from the statistics from government and myjoyonline.com is that 9 million Ghanaians are either unemployed or underemployed. The stats from myjoyonline.com, not only calls out the bluff of government on poverty reduction but reveals how the government has been taking us for a ride on the issue of unemployment.

It's Just Plain Lies

The Economic Management Team (EMT) is a group of Ghanaian professionals tasked with proposing sound economic policies with which the country would be governed. These professionals cannot be to be dummies and hence the reason why government figures on unemployment are not accurate. For instance, the chairman of the EMT who doubles as the Vice President of Ghana, Dr. Mahmud Bawumia, is a Cambridge University-trained economist.

This is not to say Cambridge is the only university where good economists are produced; I believe there are many universities around the world that could do the same if not even better. But given the track record of Cambridge in producing professional economists, I need to emphasize to drive home the point that it is inconceivable to imagine Dr. Bawumia or the finance Minister, Ken Ofori Atta, being dummies. Dr. Bawumia got all his economics right when his party was in opposition. He rightly stated in 2016, a few months before his party won the elections, that when the government settles its debt to the Electricity Company of Ghana (ECG), the woes of the company would be over.

Today, as the vice-president, he is bent on privatizing the company, a stance he previously criticized, exposing his double-standards. The cross carpeting of Dr. Bawumia epitomizes the dishonesty that has come to plague the governance process in Ghana. Ghanaian politicians say one thing today and say the exact opposite the next day. It is this lack of insensitivity on the part of our politicians that have kept us hoodwinked over the issue of unemployment.

We must not acknowledge 7.1% as the prevailing unemployment rate in the country for it fails to reflect the realities on the ground. With the millions unemployed and underemployed, the unemployment rate should be, even in conservative estimates, in the range of 40-50%. It is only when we stop romanticizing about the problem of unemployment that we can find its real-time solutions.

The writer is Amodani Gariba, chairman of the Nkrumahist Circle, based in Accra, Ghana.

Disclaimer: "The views/contents expressed in this article are the sole responsibility of the author(s) and do not neccessarily reflect those of Modern Ghana. Modern Ghana will not be responsible or liable for any inaccurate or incorrect statements contained in this article."

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