Monday, October 25, 2021

Are unemployment numbers mocking the actual reality?

Local economists have continually denounced unemployment as a serious problem in Botswana and in recent times given it a grim face but the latest unemployment figure released by Statistics Botswana seems to counter that description.  At 17.7 percent the new unemployment rate is three percentage points lower than it was in 2013 at 20 percent, indicating a decline.   

A study by the International Labor Organisation (ILO) titled ‘Statistics of Employment, Unemployment, Underemployment: Economically Active Population’ makes an important remark that, “it is often argued that employment statistics, as presently compiled, provide a misleading picture of the actual work situation,” which it attributes to the issue of existing differences in the way the concept of employment is defined in theory and the way it is measured in practice. Could this be the case in Botswana? 

Unemployment trend (1981 ÔÇô 2015/6) 
Between 1981 and 2013 the highest unemployment rate recorded was 26.2 percent in 2008 as was derived from Botswana AIDS Impact Survey III (BAIS III). Four years earlier, in 2004, the unemployment rate was 24.6 percent coming in second to the highest rate.  The year 2002/03 also recorded a high rate at 23.8 percent as was derived from the Household Income and expenditure Survey (HIES). During the period between 1981 and 2013 the lowest rate was in 1981 at 10.2 percent as was determined from the census. Following 2008 the unemployment rate depicted a declining trend falling sharply from 26.2 percent to 17.8 percent the next year in 2009/10 as was deduced from the Botswana Core Welfare Indicator Survey (BCWS). Two years later in 2011 the unemployment rate increased slightly to 19.9 percent as was established from the census and then picked up marginally to 20 percent in 2013 as was worked out from the Botswana AIDS Impact Survey IV (BAIS IV). The current unemployment rate at 17.7 percent as was derived from the 2015/16 Botswana Multi-Topic Household Survey is consistent with the observed fall off trend. 

Economically active population trend 
In 2008 economically active population was recorded at 695, 865. Economically active refers to individuals who are currently employed and those who are actively seeking work. Out of this population 513,608 was employed and 181,257 was unemployed. The following year in 2009/10 the economically active population increased to 705,447 with 579,429 people that were employed and 126,018 that were unemployed. Keeping to the momentum the economically active population rose to 801,518 in 2011 out of which 642,065 individuals were employed and 159,453 unemployed. The climb remained consistent to 2013 with the economically active population recorded at 900,337 from which 720,296 people were employed and 180,041 unemployed. The latest figures of 2015/16 broke off the rising trend of economically active population with the number having fallen to 844, 049 out of which 694, 749 people are currently employed and 149, 300 are unemployed and actively seeking work. From the employment indicators it can be deduced that the number of people that were employed demonstrates a build up between 2008 and 2013 with the trend cutting off in 2015/16 as indicated by a decline. A comparison between 2013 and 2015/16 shows that 25, 547 people who previously held jobs found themselves out of employment. This represents a 3.5 percent shed off.  Still comparing the two, the figures indicate that less people did not have jobs in 2015/16 as shown by the number of unemployed people falling by 30 741. This represents a 17.1 decline.  

Analysis 

The unemployment trend depicts fluctuating rates. The figures don’t seem to provide an adequate representation of the unemployment situation in Botswana except that in the past decade unemployment rate has been on a downward trend.   

At 82.3 percent the rate of employment nullifies the finding by local analysts that the economy is unable to generate adequate employment opportunities both within formal and informal sectors. On the contrary the rate of employment suggests a high job creation within the economy.   

A reduced unemployment rate suggests that either the economy opened up on job opportunities or that people have given up on the prospect of finding jobs. Brothers Wilright Malema, University of Botswana Associate Professor, on his report titled ‘Unemployment and the Attributes of the Unemployed in Botswana,’ expresses the view that “the reduction of the unemployment rate through employment creation rather than discouragement is key in fighting the three evils of poverty, unemployment and inequality.” 

Statistics Botswana could not provide analysis to the reduction in unemployment when quizzed by this publication on account of overwhelming inquiries it received regarding the survey results and promised to respond at a later time. “It is important to note that this is a preliminary report and as such, more information and more in-depth analysis will be provided in the comprehensive survey report which is still to come,” stated Lillian Setimela, Manager in Communication, documentation and dissemination department at Statistics Botswana. 

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