The Head of Economics Department at the University of Ghana, Professor William Baah-Boateng, has urged government to take a second look at the YouStart initiative’s implementation procedure.
The government, in an effort to address the high youth unemployment situation, announced the ‘YouStart’ programme as an initiative to help young people, especially graduates, start their own business with adequate capital and other necessary support.
The YouStart initiative, Finance Minister Ken Ofori-Attah said, will have GH¢1billion budgetary support each year to catalyse an ecosystem to create 1 million jobs. It will support youth-led enterprises with district-level loans under GH¢10,000 after 2-3 months of training; soft loans of up to GH¢50,000 to help start-ups (in particular of young graduates and school leavers) and small businesses to expand; starter packs (soft loans tied to equipment acquisition) of up to GH¢50,000 for individuals and GH¢100,000 for associations/groups; and a standardised loan package of between GH¢100,000 to GH¢400,000 at concessional rates for SMEs through financial institutions.
However, while Prof. Baah-Boateng lauded the initiative, he argued that implementing YouStart as an entrepreneurship drive risks failing if it goes along the same lines as has been seen in the past.
He said: “Over the years, the entrepreneurial strategy has been to provide a meagre amount to the number of youth that does not take them anywhere.
“For instance, it was reported in the Budget that Ghana Enterprise Agency provided 302,001 successful applicants with loans amounting to GHȻ523.11million under the Coronavirus Alleviation Programme Business Support Scheme. This yields an average of GH¢1,732 per applicant, which cannot translate into transformational entrepreneurship and decent employment.”
He urged that government must relook at the implementation whereby the YouStart initiative targets transformational entrepreneurship by picking winners rather than numerous micro entrepreneurships which might not necessarily lead to decent work.
“I expect that creation of the 1 million jobs should not necessarily mean that all of them will be entrepreneurs, but few of them are going to be entrepreneurs and employ the rest – and that is what we expect from government. That is the path that, if government follows, is going to create more decent and productive employment,” he said.
He was speaking at the Ghana Employers’ Association (GEA) forum to review the 2022 National Budget with regard to existing and newly-introduced measures that affect the business environment.
He also said it is important that government takes a look at the unemployment issue critically, otherwise it will come out with policies which when implemented will not come to fruition.
“What research informs the 1million jobs? Many times, government panics when job fairs are going on – especially when it sees the number of people attending; but from a statistical perspective, not all the people attending the job fair are unemployed. Some might have jobs but need better ones. And when government panics over such numbers and comes up with initiative, it is likely to fail,” he said
He added that other ways government can reduce the unemployment numbers include revamping the private sector and providing it with an enabling environment so it can grow and absorb unemployed people.
Also, short-term measures – looking at those who don’t have skills but can do something and engage them; and middle-term – being able to provide skills to others, be they technical, vocational and so on, for the long-term.