11,657 formal private sector jobs lost due to COVID-19 – Employment Ministry

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Photo: Ignatius Baffour Awuah, Minister of Employment and Labour Relations

A survey commissioned by the Ministry of Employment and Labour Relations has revealed that 11,657 jobs have been lost due to the effect of the Coronavirus pandemic on the operation of enterprises.

According to the survey which covered 878 formal private sector establishments, the figure represented 31.5 percent of the total jobs created by the targeted establishments for the survey. The survey was done to give the government an understanding of the state of Coronavirus induced job losses and fashion programmes to mitigate the plight of persons who have been affected.

Speaking at the 12th National Development Planning Commission Forum on the theme: The Future of Work in Post COVID-19 Ghana, the Minister of Employment and Labour Relations, Ignatius Baffour Awuah said: “Some employees had to cope with job losses and pay cut for their enterprises to cope with the disruption in the supply chain caused by the pandemic. We have observed that while the pay cut was rampant in large and medium scale establishments, workers in micro and small enterprises suffered most of the job losses.

In terms of pay cuts, large and medium scale establishments had to adopt pay cut strategies to keep some workers on their payroll.  Generally, the 878 non household establishment surveyed recorded 31.5 percent job losses. In terms of pay cuts, 40 percent of the workers interviewed suffered between less than 10 and more than 50 percent pay cuts to keep their jobs.”

The survey gave little attention to workers in the informal sector which employs over 80 percent of the country’s workforce. The Minister believes that the figure could have been way above what has been recorded if the informal sector was factored.

Also, the public sector was eliminated from the survey because the government ensured they receive full salaries even though there were some major job destruction. The minister pointed out that, public sector involvement in the survey had the potential to reduce the figures recorded.

“It is important to note that the picture would have been more devastating if the survey was extended to workers in the informal sector where over 80 percent of the workforce is engaged. We concentrated mainly on the formal private sector even though there was some bit of informal sector addition.

We took away public sector institutions because the public sector is mainly paid by the government and during the period the government tried to pay all of them. If we had included them the percentages would have come down,” Mr. Baffour Awuah told the forum.

It is believed that this survey would be factored into the development of the National Unemployment Insurance Scheme which the Minister of Finance, Ken Ofori-Atta, announced during the presentation of the mid-year budget review to Parliament.

“Government will inject liquidity into the system to ease cash flow difficulties of businesses and protect workers by honouring obligations to contractors and suppliers in a timely manner,” he said, adding that through the Ministry of Employment and Labour Relations (MELR), government would collaborate with the social partners (labour and employers) to establish a National Unemployment Insurance Scheme.

“The scheme will provide temporary income support to workers that are laid off and also provide them access to re-training to help them take advantage of employment opportunities in new fields,” Mr Ofori-Atta said.

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