Monday, April 22, 2024

Formal sector employment up by a measly one percent

The number of jobs in the formal sector increased by one percent from 341 115 in September 2015 to 344 490 in September 2016 according to the latest Bank of Botswana (BoB) Annual Report. 

The growth, according to the bank, is attributable to a slight increase in the number of private sector employees, especially in the construction sector. 

The construction sector got a boost in early 2016, when the government introduced the Economic Stimulus Programme (ESP) which was adopted to promote growth, economic diversification and employment creation.

Official figures from the government enclave peg the total expenditure by the government on this flagship programme for the 2016/17 financial year at P2.2 billion. By the end of January 2017 the contract amounts for awarded projects stood at P1.9 billion. However, Minister in the Office of the President, Eric Molale told Parliament in February 2017 that the total expenditure for ongoing and completed projects as at the end of January 2017 was P519.8 million.

Regarding employment creation, Molale said over 20 000 people were employed through awarded ESP projects by the end of November 2016. He further said that a breakdown of employed people showed that 19 907 were citizens and only 120 were non-citizens. 

Meanwhile, BoB says that the limited movements in overall and composition of formal employment by sector was maintained in the past five years, with the private sector accounting for about 60 percent of the formal sector work force.  

At the same time, the central bank says for more effective policy making and monitoring, more up-to-date estimates on unemployment are necessary.

The most recent domestic unemployment data are from the Botswana AIDS Impact Survey IV (BAIS IV) for 2013, which estimates a national unemployment rate of nearly 20 percent of the labour force. The survey further shows that the unemployment rate was higher for women than men (22.3 percent compared to 17.8 percent). 

In April 2017, the Finance and Economic Development Minister Kenneth Matambo said that he was unable to provide details of recent job losses that had been generally allied to liquidations and collapse of companies. 

Selebi Phikwe West Member of Parliament Dithapelo Keorapetse had asked Matambo to explain to Parliament the rate of job losses in the economy over the last 24 months. 

Keorapetse further requested him to break down the statistics relating to job losses by sectors due to retrenchments, liquidations as well as collapse of companies. 

In his response, Matambo stated that although the government statistics agency, Statistics Botswana, conducts quarterly formal employment surveys to monitor the state of formal employment in the economy, collected data does not detail reasons for the job losses. 

“Information on formal employment is collected from business establishments and enterprises, which include government, both central and local authorities, parastatals, companies and other entities in the formal sector. 

“I am afraid the collection in presentation of this statistical information does not detail the reasons for the job losses. My Ministry is therefore unable to provide the details of losses due to liquidations, collapse of companies or any other reason,” Matambo said. 

 In March 2015, in a similar fashion as in April, Matambo resisted calls for an ad-hoc unemployment survey calling on Parliament and the entire nation to “wait for a comprehensive national survey that will incorporate all sectors to present a well informed unemployment rate”. 

At the time, Matambo said that he was not in a position to avail the unemployment figures because such analysis would be incorrect, given signs of economic growth on the one hand, and a spate of retrenchments by some companies on the other.

Sector                                                        Job losses in percents 

Mining and Quarrying                                   2.7%

Financial Intermediaries                                3.6%

Central Government                                      0.6%

Local Government (Ipelegeng included)         1.0%

Local Government excluding Ipelegeng)        4.0%


Source: Ministry of Finance 


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