The COVID-19 crisis has caused economic damages, destroying the livelihood of many. An economic recovery strategy by Ghanaian policymakers should be centered on transformative reforms that ensures the participation of the vulnerable, the poor and those at risk of extreme poverty amid the crisis. Key to this approach is the creation of millions of jobs as a strategy to restart growth which is both inclusive and sustainable.
Global economies have faced economic distress following the ongoing COVID-19 crisis and are still recovering from the devastations it has left in its wake. The imposition of containment measures (social distancing, lockdown and border closure) has led to growth contraction for many countries. For some observers, the pandemic is likely to plunge the global economy into a recession that rivals the Great Depression. And while some countries have had V-shape recession and recovery, the shock on many economies could leave a scar. Macroeconomic indicators glaringly show that the effects of the fallout on economic growth have been immoderate. Anecdotal evidence also suggests that the impact of the crisis on vulnerable groups have been more radical.
Consequently, the crisis has negatively impacted employment levels. livelihoods have been destroyed mostly in the tourism and hospitality sector and among certain groups such as women and youths. This has led to a reduction in income levels, consumption and savings rate which is disturbing as it serves as the perfect ingredient to complete the recipe for reversing the gains chalked by poverty reduction efforts, further widening the inequality gap and increasing extreme poverty levels. As a result, policymakers should give attention to recovery strategies that ensure that the economic damage of Covid-19 is not long-lasting.
Ghana has had its share of the fallout with reports from the Ghana Health Service indicating 86,248 confirmed cases and 734 deaths. But whiles, it has had fewer death cases relative to other countries, the economy-wide implication has been far-reaching, affecting every sector of the economy.
The government’s relief packages such as the decreasing of the policy rate, the extension of the tax filing date, the granting of a six-month moratorium for the airline and hospitality industry, the provision of free water and electricity by the government and the establishment of a Covid-19 fund did provide some breathing space for Ghanaians. But whiles these efforts are laudable, they do not address the damage the pandemic has had on the economy in a permanent and sustainable fashion.
An Inclusive approach
A recovery strategy by the government should be one that assumes an inclusive posture. It must capture the poor, the vulnerable and those affected by the pandemic in the recovery process. In other words, the economic recovery strategy by Ghanaian policymakers should focus on the extent to which the poor and vulnerable are participating in the recovery process. Consequently, making job creation central to the economic recovery process has the potential to bring back Ghanaians from the fallout of the pandemic in a sustainable fashion. Policymakers cannot afford to use macroeconomic indicators as the only measure for progress after the pandemic has fizzled out. Therefore, adopting job creation as a strategy, is an inclusive way of ensuring that the poor, vulnerable and those at risk are not left behind in the recovery process.
Domestic Private Sector Support
Policymakers can support job creation effort by creating an enabling business environment for the domestic private sector. The current lack of support for domestic private businesses in Ghana has accounted for the country’s economy being dominated by foreign capital. This has culminated in economic growth generated within the country but not resident in the country. As a result, Ghana’s economic growth and development have been largely driven by foreign capital. This cannot be the narrative post-Covid-19. In an economy where 80%-90% constitute the informal sector, it will take the domestic private sector to drive a job creation agenda. Policymakers should therefore collaborate with the private sector to make the economic recovery process a job-rich one.
Education and Skill development
To ensure a job-rich recovery, government has to ensure that education and skills development aligns with the demands of the industry. Ghana’s labour force is characterized by a weak human capital resource base that is of low quality that can affect the transformational and sustainable development agenda for a post-Covid-19 recovery. Thus, one of the major challenges facing Ghana in the generation of employment is in the area of skill development.
Graduate numbers from tertiary institutions and other learning centers keep increasing without jobs to absorb them – partly due to the mismatch between labour demand and supply. Requisite skill set required for existing jobs are lacking. The government therefore, should encourage Centers of learning to revise and review their curriculums to ensure that the next generation of students are prepared to meet the current industry demands and the future of work (industrial 4.0). The dawn of the industrial revolution presents a lot of opportunities and at the same time threats. Government, therefore, has to ensure that skill development leads to employment generation, job-creation, are entrepreneurial in nature and responsive to the future of work. In this way, jobs that are created will be maintained for the foreseeable future.
Developing and tracking employment data.
To sustain the job creation outcomes, government and relevant stakeholders must develop and track data that captures annually, jobs created and people employed. Ghana lacks comprehensive data on jobs created and the number of people employed in different sectors of the economy, especially those created by the domestic private sector. Government institutions (Ministry of Planning, Ministry of Finance, Ghana Statistical Service and Bank of Ghana) together with other relevant stakeholders (Think tanks and Civil Societies) should work together to develop reliable data and track employment data
In conclusion, as Guy Ryder (Director-General of ILO) rightly indicates “for millions of workers, no income means no food, no security and no future. As the pandemic and the jobs crisis evolve, the need to protect the most vulnerable becomes even more urgent.” To this end, the government must enact policies and measures that support and sustain lives post-Covid-19 by creating an enabling for domestic private businesses to create jobs, provide requisite education and skills and develop and tracking employment data.
The writer is a PhD student interested in the Private Sector growth in Ghana