Discouraged workforce, a cause for concern

WITH a total of 26,8 percent of the unemployable population in Zimbabwe being discouraged workers according to Zimbabwe National Statistical Agency (ZimStat), the country needs to work on stimulating the jobs market.

Expanded unemployment rate increased from 45,2 percent in the second quarter of 2023 to 47,8 percent in the quarter under review due to cyclical employment in the agricultural sector as most of the crops are planted during the November to May season.

Of the 47,8 percent a total of 26,8 percent are discouraged job seekers who are not actively looking for work and are not participating in the labour market.

As a result, on a quarterly basis, the 2023 third quarter unemployment rate increased by 1,3 percentage points to 21 percent compared to the second quarter of 2023.

“Year-on-year comparison shows that the 2023 third quarter unemployment rate increased by 0,9 percentage points compared to the same quarter of 2022,” the report said.

Economist, Dr Prosper Chitambara, said the country needs to work on making the environment conducive for investment and increase jobs in the country.

“It all comes down to what government needs to do in order to increase the participation of private money in building the economy and creating jobs in the process. All this is caused by fatigue which comes with not finding a job in a year or two whilst needing it,” he said.

Another economist, Enerst Mhlanga, noted that government should also let the small to medium enterprises (SMEs) flourish and reduce the problem.

“We see that our labour force is concentrated in SMEs so there is need to let them grow to professional levels with guidance and less restrictions especially in terms of taxes so that they employ more and reduce poverty,” he said.

Speaking of unemployed youths who were not in education or employment or training (NEET) for the 15 years to 24 years they accounted for 47,1 percent of the employment age population and 50,2 percent of the 15 years to 34 years’ category.

Labour specialist, Peter Mutasa, said the situation needs to be looked into as it is leaving most of the youths doing drugs and being a burden to their families.

“If you look at those numbers you will see that a sizeable number of youths are unemployed and are engaged in nothing, hence the need for empowering the vocational centres we have and also have venture capital firms that empower these youths because they are contributing much to poverty in the country as dependents,” Mutasa said.

Average monthly incomes across industries ranged from $43,016 in activities of households as employers of the domestic personnel industry to $2 751 651 in the electricity, gas, steam and air conditioning supply industry.

According to the agency’s poverty survey, a single person in September needed $73 236 for food only and their total consumption poverty line was $95 463 which is already more than a single person’s income of three categories surveyed by ZimStat in the second quarter.

Chitambara also believes that the high level of informal employment is associated with poverty because of the low income levels and low productivity associated with the employment level.

“We need to expunge or reduce the level of informality, but in order to do so we need to deal with factors such as tax reforms, business reforms and educational reforms, which means we need a comprehensive cocktails of reforms in order to unlock the sustainable growth needed going forward,” Chitambara concluded.

Although it has declined since its peak of 2020, extreme poverty remains high in the context of cyclical agricultural production and elevated food prices.

According to ZimStat the rate of extreme poverty in Zimbabwe fell slightly to 42 percent in 2022, down from 43 percent in 2021.

This is according to the results of the latest high-frequency telephone survey, known as the Rapid-Poverty Income Consumption and Expenditure Surveys (PICES) carried out by ZIMSTAT between December 2022 and January 2023. According to the survey, the proportion of Zimbabwe’s population facing severe food insecurity dropped from 27 percent in July 2020 to 9 percent during the December 2022-January 2023 period.

The African Development Bank in its country outlook in March wrote; “The extreme poverty rate was estimated at 44 percent in 2022, and the Gini coefficient was 0,503 in 2023.” The Gini coefficient, is a measure of statistical dispersion intended to represent the income inequality, the wealth inequality, or the consumption inequality within a nation or a social group measured between 0 and 1, with the higher it is, the higher the inequality.