• Wednesday, February 28, 2024
businessday logo

BusinessDay

Job creation versus value creation: Dissecting the myth and reassessing the facts

businessday-icon

The scope, breadth and depth of African Economic reforms put in place by the government to reinvent its economy are alarming in recent economic history. A focus is the strong empirical evidence of how the development of public sector aimed at creating jobs had yielded poor results and undermined the growth of African economy. Unfortunately, job creation has been the major economic objective of all aspiring politicians but is not often met. Kenyan President, Uhuru Kenyatta promised to create a million jobs every year, Nigerian government, more than 460,000 jobs by 2018, President Robert Mugabe(Zimbabwe) over 2million jobs by 2018, President Sata(Zambia), says 436,363 jobs had been created by his administration between October 2011 and July this year. But of what essence is Job creation with little or no economic importance? Sadly, citizens wait for government to create jobs for them and use this as a yardstick for measuring governmental success and to vote during election.

The governments often use the Labour-Intensive technique to paint a rosy picture of its administration which increases its numerical achievement for campaign and neglect wealth creation- the meaningful reason for creating Jobs. Gilbert Didier Edoa, the MINEPAT Secretary General of Cameroon, confirmed that the labour-based approach used in constructing roads, schools and hospitals has helped to create a lot of employment for the administration, but at this point, it is important to draw the government’s attention to what such jobs can do and never do.

Job directly created by government only increases the quantitative and not the qualitative value needed for wealth creation. It is very easy to count the numbers of jobs created and neglect the essence of creating such jobs. Works are meant to create economic value and increase income flow in the economy, and not to give numerical strength for campaigns, and to showcase achievements. When government decides to go into business or create employment, they are very fast in counting the thousands of Jobs created, neglecting the fact that these works are relatively unproductive, characterised by low wages, inefficiency, and about 80% are temporary low-skilled Jobs.

The Algeria National Statistics Office(ONS), for instance, revealed that the Algerian government claimed it had slashed unemployment from 30% in 2000 to 9.8% in 2013, and also boasted of 3.5M jobs between 1999 and 2008. Algerians do not only have little faith in these figures but have also protested its credibility. Just recently, dozens of young men and women stood-up against these policies. Each and everyone have a story to tell about the absurdity of the system, where job titles never match the positions offered. Economics, Law, Medicine, Engineering and other graduates end up securing temporary low-skilled Jobs paid between 10,000 and 15,000 dinars per month(i.e. $125 to $200), leaving about 900,000 pre-emplois (temporary Jobs) in hope for permanent jobs.

Unfortunately, not only the government got it wrong here; citizens’ protest also called for the wrong intervention by requesting government to give out permanent jobs. Governmental policies should encourage innovations, human talents, entrepreneurship, individual participation in market and enabling environment for business operations. Public policies aimed at correcting economic recession and reducing unemployment has only been a bad justification for increase in borrowing, government spending, taxation, aids and corruption.

Pursuing a carrier in Economics, I realized that Academic curriculum has placed government to be the savior of the economy and has identified Job creation as the primary role of government. A good start is to adjust academic scheme and clear the air that Job creation is not the role of government. Entrepreneurship should be emphasized as the means to stimulate the creativity and innovation necessary to create a better economy. Graduates should not wait for government to create Jobs for them but convert their knowledge into intellectual productive ventures. A focus of growing labour intensive industries would mean much less growth would be needed to achieve much high level of employment.
Finally, growth and development as a peculiar objective of a society can only be realistic when citizens are apostolic to their innovative ingenious life under conducive mechanisms for sustainable development.

Peter Oluleke