Jobless growth is Ghana’s biggest youth challenge

By William Baah-Boateng

Youth unemployment and joblessness together constitute a major socio-economic and political problem in Ghana and many other African countries even though Ghana’s growth performance has been quite impressive. With the exception of 2014, when growth fell below 4 per cent, the country’s GDP growth has been remarkably high, ranging between 4.3 per cent and 14 per cent. This gives an annual average growth rate of 8.1 per cent over the period 2007-2013.

But this has not translated into jobs for a rapidly expanding labour force as employment growth has not kept pace with the strong GDP growth, particularly in the formal sector. This can be seen as a crisis of jobless growth. It is estimated that each 1% of economic growth translates into 0.5% growth in employment, with most new jobs created in the informal sector (Aryeetey and Baah-Boateng, 2016). These jobs are insufficient to meet the rising number of labour market entrants.

While unemployment is a challenge among all age groups, its impact is particularly severe among the youth. Young people tend to have higher rates of unemployment and to engage in vulnerable and informal employment.

Young people between the ages of 15 and 35 make up about a third (33.5%) of Ghana’s population. They enter the job market with different levels of education and with limited or no work experience, which tends to impede their chances of securing productive and/or formal sector jobs.

The difficulties in securing adequately paid and productive jobs after school tends to increase the vulnerability of young people and can make them susceptible to social vices as well as a source of conflicts and civil disorders.

The high and increasing incidence of street hawking and the migration of Ghanaian youths across the Sahara Desert and the Mediterranean, despite the risks, are symptoms of labour market challenges and also reflect a sense of hopelessness.

The youth constitute a potential resource for growth and development if they are gainfully and productively engaged. But they can also be a source of civil conflict and social tension if this untapped resource is poorly managed. Indeed, disaffected youth without education, jobs or the prospect of a meaningful future may fuel future instability, migration, radicalization and violent conflict.

The youth face specific challenges in accessing labour market opportunities, which has the effect of lowering their chances of finding decent jobs. Indeed, the lack of experience of young people in the labour market poses specific barriers to securing productive and better paying jobs.[1] Additionally, they also stand the highest chance of losing their jobs in times of economic downturn. Underutilizing the skills of young people does not only expose the youth to social exclusion but also has a triggering effect on intergenerational poverty.

It is for these reasons that youth unemployment ranks high on the development agenda at both national and global levels.

An intriguing aspect of Ghana’s youth unemployment patterns is that youth unemployment appears higher among the educated than the less educated.  Unemployment rates are highest among young people aged 29 years and below with bachelor’s degrees. They are lowest among those with no formal education or basic education.

When it comes to the gender dimension, the unemployment rate is estimated to be higher among young females than young males in Ghana.

Although youth employment has been among issues dominating the political discourse, a solution to the problem appears elusive. In this regard, the African Center for Economic Transformation (ACET) in collaboration with the INCLUDE platform has hosted a series of national dialogues on youth employment in Ghana to help find sustainable solutions to the growing youth unemployment challenge. The dialogues bring together major stakeholders including policy makers, private sector, civil society, academia, development partners, youth networks and the media.

 

Dr. William Baah-Boateng is Associate Professor of Economics at the University of Ghana. He recently completed a sabbatical at ACET.

[1] See also Clark and Summers (1982), Freeman and Wise (1982)

2 Comments

  1. Dr. Eric Oteng-Abayie, KNUST says:

    Excellent piece. Jobless growth is a poison pill. Shared growth agenda of governments must target youth employment as a matter of priority. Harnessing this human capital will service as a catalyst in achieving the sustainable development agenda of “jobs for all”.




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  2. […] scarcity of high-quality jobs contributes to Ghanaian bachelor’s degree holders suffering from higher levels of unemployment than those with no formal or basic […]




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