Boost­ing jobs in con­stituen­cies

Jamaica Gleaner - - OPINION & COMMENTARY - Vanus James and Ros­alea Hamil­ton Guest Colum­nists Vanus James, PhD, and Ros­alea Hamil­ton, PhD, Sco­tia­bank chair, En­trepreneur­ship & De­vel­op­ment, UTech. Email feed­back to col­umns@glean­ and rhser­ or sco­tia­

THIS FIS­CAL year, the Gov­ern­ment plans to spend $459.4 bil­lion, or 79% of the Bud­get, on day-to-day op­er­a­tions such as salaries and util­ity bills (i.e., re­cur­rent ex­pen­di­ture) and $120.6b, or 21% of the Bud­get, on long-term de­vel­op­ment projects and pro­grammes (i.e., cap­i­tal ex­pen­di­ture). This means that we have $88.4b less avail­able for cap­i­tal ex­pen­di­ture than we had last year, to rev up the en­gine of growth and cre­ate the jobs in con­stituen­cies promised by mem­bers of par­lia­ment (MP).

It is this cap­i­tal ex­pen­di­ture that is crit­i­cal for driv­ing growth in the econ­omy and en­abling the coun­try to achieve the 1.7% growth in FY16-17 pro­jected in the IMF’s 11th and 12th EFF re­views. But how does this cap­i­tal spend­ing trans­late to boost­ing jobs in con­stituen­cies? Per­haps it is time to find a sus­tain­able an­swer to this ques­tion.

To avoid job­less growth, what must be de­cided is which forms of cap­i­tal spend­ing most di­rectly sup­port the ex­portready, job-cre­at­ing firms. While the ben­e­fits of broad-based cap­i­tal spend­ing are foun­da­tional and im­por­tant, suc­cess­ful job cre­ation also re­quires that a por­tion of cap­i­tal spend­ing be di­rected to sup­port­ing the firms that are ex­port-ready and can cre­ate jobs.

Some of this speci­ficity comes from gath­er­ing and study­ing mi­cro-data from busi­nesses, such as the Sco­tia­bank En­ter­prise-Wide Risk Man­age­ment and Fi­nanc­ing dataset col­lected by the Sco­tia­bank Chair in En­trepreneur­ship & De­vel­op­ment at the Uni­ver­sity of Tech­nol­ogy (UTech), Ja­maica. Such data en­able us to bet­ter iden­tify the ex­port-re­spon­sive firms in spe­cific con­stituen­cies and com­mu­ni­ties.


We can es­ti­mate that the high­est con­cen­tra­tion of the ex­port-ready cre­ative firms is in Kingston (12% of all firms). The other sig­nif­i­cant con­cen­tra­tions are the neigh­bour­ing St An­drew (8%) and St Cather­ine (7%). Sig­nif­i­cantly, the data en­able us to pro­vide tar­geted sup­port to these firms in the con­text of Kingston’s new des­ig­na­tion as a Cre­ative City of Mu­sic by UNESCO.

It should not be too dif­fi­cult to as­sem­ble these firms for a di­a­logue about the type of pub­lic phys­i­cal and so­cial cap­i­tal in­fra­struc­ture that will most sig­nif­i­cantly boost their ca­pac­ity to ex­port. For ex­am­ple, in­vest­ing in a sta­teof-the-art per­for­mance cen­tre or mu­sic mu­seum is an im­por­tant in­vest­ment pro­posed by mu­sic/cul­tural stake­hold­ers for some time now. This can build global de­mand for high-qual­ity en­ter­tain­ment that will at­tract an in­ter­na­tional mar­ket on an on­go­ing ba­sis and sup­port cul­tural tourism. This is the difference be­tween pub­lic cap­i­tal spend­ing on in­fra­struc­ture and sus­tain­able job-cre­at­ing cap­i­tal spend­ing.

Some of the speci­ficity also comes from hav­ing ac­tive, on­go­ing di­a­logue about cap­i­tal spend­ing be­tween the peo­ple and en­ter­prises in con­stituen­cies and the sit­ting MPs in­volved in the Bud­get De­bate. Un­der the lead­er­ship of the MP, this ac­tive di­a­logue in­fuses tar­geted jobcre­at­ing projects and re­lated cap­i­tal spend­ing into the bud­get process.

If this is com­ple­mented by the ini­tia­tives of firms in the con­stituen­cies that are in­volved in forg­ing in­ter­na­tional part­ner­ships to at­tract for­eign in­vest­ment to help do­mes­tic firms be­come ever more ex­port-ca­pa­ble, job cre­ation would fol­low along with a more com­plete mar­ket re­sponse to the ini­tia­tives that seek to im­prove the balance of pay­ments and bud­getary prob­lems.


The lead­er­ship of the MP can­not be un­der­stated in this process. In ad­di­tion to be­ing able to com­man­deer data from the min­istries, the MP has the moral au­thor­ity to as­sem­ble the full spec­trum of busi­ness lead­ers in his or her con­stituency to con­sider how best to cre­ate jobs through tar­geted cap­i­tal spend­ing. The con­stituents, how­ever, must be will­ing to di­a­logue with their MP and make their voices heard.

En­gag­ing di­a­logue around the Bud­get is now much eas­ier with the as­sis­tance of the Ja­maica’s Cit­i­zens’ Bud­get and Guide, pre­pared by the In­sti­tute of Law and Eco­nomics in col­lab­o­ra­tion with the Sco­tia­bank Chair in En­trepreneur­ship and De­vel­op­ment at UTech. This guide will as­sist Ja­maicans in un­der­stand­ing many as­pects of the Bud­get, in­clud­ing the Gov­ern­ment’s plans for cap­i­tal ex­pen­di­tures.

Now more than ever we need to use mi­cro-level data with avail­able bud­get in­for­ma­tion and re­think our re­la­tion­ship with our MPs by mak­ing our voices heard, es­pe­cially the voice of en­trepreneurs, to en­sure that we get the most from our cap­i­tal spend­ing to boost the much-needed jobs in con­stituen­cies across Ja­maica.

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