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Ghana underutilizing 47% of potential labour – report

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ILONearly half of Ghana’s potential labour force – 47 per cent – is unemployed or underemployed, according to the International Labour Organization’s (ILO) 2016 World Employment and Social Outlook Report.

According to the ILO report, Ghana’s composite measure of labour underutilization is 47 per cent; that is the combined percentage of the working age population that is unemployed or underemployed, along with potential workers who are not part of the labour force (unemployed and looking or not looking for jobs).

Ghana is not alone, and the ILO says the vast majority of workers in sub-Saharan Africa find themselves in informal or vulnerable employment.

The ILO estimated that as at 2009, nine out of ten workers in sub-Saharan Africa held informal jobs.

There appears to be little improvement since then and by the ILO’s statistics the share of the labour market in working poverty, that is those who are moderately poor, living on $1.9 to $3.10 and working jobs that do not return enough to escape poverty – has been on the rise.

According to the ILO’s research department, working poverty rose from about 23.8 per cent in 2007 to 29.7 per cent in 2015.

The figure is projected to reach 30 per cent in 2016 and 30.4 per cent in 2017 buoyed by limited formal job opportunities available to the most vulnerable populations such as the poor, women and youth.

While the informal economy in sub-Saharan Africa contributes 50 to 80 per cent of GDP, 60 to 80 per cent of employment and 90 per cent of new jobs, the ILO says that unfortunately, most people in informal work are in low-skilled jobs and exposed to unsafe working conditions, with inadequate training opportunities, low wages, long working hours and no social protection.

“The incidence of vulnerable employment remains pervasive in the region, at almost 70 per cent of total employed against a global average of 46.3 per cent. More importantly, this share shows no sign of decreasing in the foreseeable future, casting doubts on the region’s ability to reduce informality and improve job quality,” the report said.

The ILO said unemployment in sub-Saharan Africa moved up marginally from 7.3 per cent in 2014, to 7.4 per cent in 2015.

The unemployment rate among women rose to 8.5 per cent in 2015 from 8.4 per cent in 2014, while among men it rose from 6.2 per cent in 2014 to 6.4 per cent in 2015.

Youth unemployment also rose to 11.1 per cent in 2015, up from 10.9 per cent in 2014.

By Emmanuel Odonkor

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