Thursday, August 18, 2022

Unemployment a global headache

Unemployment poses a double whammy ÔÇô on one hand people will find it very difficult to find jobs in the near future, and on the other, people will not possess the skills required to perform those jobs as their skills would be outdated. In layman’s terms, the skills needed for today’s economy will be irrelevant in tomorrow’s economy.
At the recent 2016 spring meetings of the International Monetary Fund it was observed that the global economy is underpinned by volatility, uncertainty and demographic changes particularly that of China. These factors have a significant bearing on the anticipated future growth. This new paradigm gives the impression that the rapid changes taking place will result in economies shifting. It should also be noted that while these economic changes are taking place, people’s skills sets won’t be moving with the changes. If the current skill sets remain dormant it denies people the opportunity to learn and develop new skills, which often is the case when people have employment. Generally employment grants people further training which is necessitated by the evolving needs which the market place must constantly respond to.
Being outside the on-the-job learning environment means that unemployed people are made redundant even before they hold the jobs. In fact, even those who currently hold jobs are not absolved from the threat of redundancy. A recent report published under the World Economic Forum (WEF) brings to the fore a paradigm termed as the Fourth Industrial Revolution. This revolution warns of impending mass unemployment for some categories of workers, combined with lack of skills in other categories ÔÇô and the political and social implications of such imbalances. It makes individuals, governments and society aware of the imminent risks of massive job losses and urges a concerted, systemic and sustainable model that is able to counter the adverse effects. The harsh reality is if the employed face such an expungement from the market place, the growing displacement of those outside the market place appears to emulate a much more difficult issue to address. It simply means then that the odds building against those unemployed will need a supreme force to be dealt with.
One should ask how issues such as unemployment become integrated with the local business environment, on the basis that the perception by businesses regarding the issue is an important part of the way in which it is addressed. The engagement of the business community with the issue of unemployment needs to demonstrate a targeted and involved approach so as to ensure that imbalances do not become part of the new economy. Bank of Botswana conducts the Business Expectations Survey (BES) twice a year seeking to find out the perceptions by the business community regarding the state of the economy and future prospects.
The BES conducted between August and September 2015 whose results cover three distinct periods: the second half of 2015, the first half of 2016 and the twelve-month period to December 2016 cite that inadequate skilled labour remains a major constraint in doing business, but is currently overshadowed by much pressing problems to do with water and power deficiencies. It would seem however that the business community does not have the capacity to absorb idling skills sets from the society.
“Companies expect to reduce borrowing in both domestic and international markets during the first half of 2016 and the twelve-month period to December 2016; this is particularly pronounced in the case of borrowing from South Africa,” cites the BES. This was despite their expectation of reduced borrowing costs which was considered to be due to the reduction of the Bank Rate from 6.5 percent to 6 percent. The limitations of the business community suggest that the issue of unemployment will continue to be passively dealt with.


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