Month / May 2018

by sheilasingapore

When The Economy Speaks … Cracking the Botswana Productivity Code. Short Notes.

 

 

BATSWANA HAVE THE WORST
WORK ETHIC IN THE WORLD – REPORT

30 Oct 2017

In its 2015 survey of African workers, South Africa’s Rand Merchant Bank found Batswana to be the laziest on the continent.  The problem is actually more acute than that.

In the 2017-2018 Global Competitiveness Report, Botswana scores the worst among the 137 countries that are tracked by the World Economic Forum’s Global Competitiveness Index (GCI) on 12 pillars of economic competitiveness.  From a list of 16 factors, respondents to the World Economic Forum’s Executive Opinion Survey were asked to select the five most problematic factors for doing business in their country and to rank them between 1 (most problematic) and 5.  The results were then tabulated and weighted according to the ranking assigned by respondents.  One of those factors is “Poor work ethic in national labour force.”

With a score of 19, Botswana’s national workforce (which would include those in the public and private sector as well as NGOs) emerge as standard bearers of the poorest work ethic in the world survey.  Also doing poorly are Trinidad & Tobago (15.9), Brunei (14.4), Sri Lanka (11.1), Liberia (10.8), Bhutan (10.5), Seychelles (10.1), Malta (9.8), Georgia (9.7), Mauritius and Vietnam (9.5), Namibia (9.3), Bahrain (9.0), Kuwait (8.7) and United Arab Emirates and Jamaica (8.6).

WEF’s interest in labour productivity has to do with the fact that it impacts on business. A University of Botswana study by Professor John Makgala and Dr. Phenyo Thebe (“There is no Hurry in Botswana”: Scholarship and Stereotypes on “African time” Syndrome in Botswana, 1895-2011”) found that this lack of productivity has frustrated effort to attract foreign direct investment. Interestingly, there was a time when, according to literature that the authors quote, Botswana’s civil service “was generally believed to be the most efficient in the whole of the African continent.”

On a past trip to Singapore, former and late President Sir Ketumile Masire gained an appreciation on the efficiency of the country’s workers. Where a Motswana factory worker would produce one shirt within a given period of time, a Singaporean counterpart would produce six within the same period.

“This was productivity not in theory but in demonstrable terms.  When we say we are not productive, this is what we meant,” Masire recalled to Sunday Standard in 2015 of this experience which would lead to Botswana benchmarking with Singapore and delegations from the two countries travelling back and forth.

As one of the Four Asian Tigers, Singapore would provide one quarter of the inspiration to establish the Botswana National Productivity Centre (BNPC). The tigers are Hong Kong, Singapore, South Korea, and Taiwan. Along the way, however, the late president appears to have given up on ever inculcating the right work ethic in Batswana. On assessing the apparent resistance, he determined that Batswana’s poor work ethic was a result of their pastoralism.

“If you look at the life of pastoralists, they don’t have a good work ethic,” he had said.  The example he had cited was that beyond sinking a borehole for their livestock, letting out cattle to pasture and doing some other undemanding work, most of the time pastoralists are just lazing about as their cattle graze untended in the bush.  By Masire’s analysis, this is the work ethic that has been bequeathed to modern-day Botswana.

As a University of Botswana study shows, not one productivity intervention scheme by the government has produced the desired results. In his 2015/16 budget speech, the Minister of Finance and Economic Development, Kenneth Matambo, lamented the low levels of labour productivity in Botswana.  The best performers in terms of work ethic in the national labor force are from Zimbabwe and Venezuela underpinned by a perfect score.

Source: Sunday Standard.  http://www.sundaystandard.info/batswana-have-worst-work-ethic-world-%E2%80%93-report Retrieved May 23, 2018

Productivity Systemic Story by Ranking

Table 1:  Comparison of Botswana with 2017’s Best Global Labour Productivity Data

DID YOU KNOW?  THE AVERAGE PER CAPITA PRODUCTIVITY IN BOTSWANA
LAGS THE WORLD’S PRODUCTIVE COUNTRY BY 30-40 TIMES?

TALKING POINTS (FOR NOW):

COUNTRY’S GENERAL ECONOMIC PRACTICE:

  1. An economic system defines the mechanism of production, distribution and allocation of goods, services and resources in a society/country with defined rules and policies about ownership and administration.
  2. The most commonly followed economic system is modern-day capitalism.  It was based on a framework to secure supply of the key elements required for industry – land, machinery and labor.  A disruption in any of these would lead to increased risk and loss for the venture.

THE COUNTRY’S GENERAL ECONOMIC PRACTICE, ON THE OTHER HAND:

  1. Socialists viewed this commoditization of labor as an inhuman practice.  I am of the view, that those words are distinctively that of the female voice possibly lending itself from Marx’s known instances of showing great sympathy for peasants, and especially women, as important forces for change within Marx’s theory (and quite possibly marks the genesis of a matriarchal society – even so where women leads quietly from behind the scenes often as a response to survive in the face of absent males who  have needed to travel long distances to work in the agriculture and mining industries – and so have become increasingly ‘masculinized’).
  2. These, I believe, led to the birth of Karl Marx’s idealism on socialism and socialist economies across a few countries.

    • How does a socialist economy work?
    • The starting point to this form of economy is three-fold typically:
      • The country has substantial access to wealth generated by mining underground mineral and fossil fuel resources and which is demanded by other world economies and is traded in exchange for income;
      • Or it has traditionally enjoyed a monarchy and/or a pastoral economy and access to substantive land spaces that allows it to multiply livestock and warm crops (that does not require as much attention compared to cold crops) at rates faster than the rate at which the human population multiples with relative ease.  The monarchy supports its people when they ask for help and assist in distributing the wealth in the form of  shared resources (such as land) or meat and food as needed.
      • Either ways, the population therefore, has a tradition and work ethics unlike that of the farmers in parts of Asia, such as southern China where rice cultivation can be an intricate, laborious, multi-seasonal in a year and since the majority of whom have limited resources, they have learned to improve the returns on their labor by “becoming smarter, being collaborative, by being better managers of their own time, and by making better choices.”  In other words, more than simply working hard, they worked intelligently and strategically.  Cultures “shaped by the tradition of wet-rice agriculture and meaningful work” tend to produce students with the fortitude to “sit still long enough” to find solutions to time-consuming and complex math problems, for instance.  As such hard work given this context, can easily be perceived as more difficult than usual and therefore quite possibly regarded as inhumane.
        Source: “Rice Paddies and Math Tests,” Malcolm Gladwell
    • There are three prominent characteristics of the socialist economy:
      • That the goods and services are produced based on usage value or for their usefulness (subject to the needs of the society, and so preventing under-production and over-production).  Therefore, it eliminates the need for a demand-based market for products to be sold at a profit.   This is completely different from the common capitalist economic system, where goods and services are produced by economies of scale to generate profit and capital accumulation.  In this way, it discourages accumulation, which is assumed to be the root cause of wealth imbalance across the society.
      • It is a financial system based on the public or cooperative ownership of production.  Socialism, similar to communism, advocates that the means of production be owned by the people, either through a state-controlled agency or worker cooperative; or else property/capital might be commonly owned by the society as a whole, with delegation to representatives.  Socialist economies discourage private ownership.  For example, this includes having a mostly state-run economy, subsistence farming on lands purposed for shared or communal use, a national health-care program, government- paid (i.e. free) education at all levels, subsidized housing, utilities, entertainment and even subsidized food programs.   These subsidies compensate for the low salaries of workers, making them better off than their international counterparts in many other countries.
      • Socialism also believes that wealth and income should be shared more equally among people.  Therefore, perceiving the receipt of income as an entitlement rather than merit is acceptable within all levels of society.  “If you have it, then I should have it too.”  Taken to an extreme, that would not bode well for productivity, would it?  It therefore becomes a misnomer to say that socialism and free market economies can realistically co-exist. However, the main goal of socialism is to narrow, but not totally remove, the gap between the rich and the poor.  The government, through its agencies and policies, takes the responsibility to redistribute production and wealth, making the society fairer and leveled.
    • The consequences of the above, are as follows:
      • The economy relies on sectors whose productive practices are not apparent to the masses or there is heavy reliance on machinery and technology such as in mineral extraction and processing, real-estate and passive income business practices such as multi-level marketing. The social environment makes it difficult for the general masses to imbibe productive work ethics and practices, to a point of shunning and even dismissing those who may display such practices;
      • The dominant trade offered by the masses to foreigners and professional include domestic maid services and guard duty security services.  Neither of these services train the individual learn to generate income but rather protect and consume resources that are already there.  The element of hard work is for the most part, removed.
      • Significant masses of citizens make purchases primarily do so, not to support entrepreneurial growth but to ensure redistribution of wealth, i.e. flows from professionals, foreign investors or expatriates operating within the system to the citizens;
      • The system works on ‘forces’ that facilitate the flow of money from those who have to those who do not and who are then, in turn, amply rewarded, even if with kind words.  The following are used intentionally or otherwise, to draw special notice to it to facilitate the flow to:
        • The informal business sector with standard essential products the masses use such as airtime, sweets, fat cakes, essential foods such as vegetables, meat and milk, drinks, cigarettes, drugs and alcohol.  A significant part of the income from the sector is used with a view to make ends meet rather than necessarily to grow an enterprise.  Growing large enterprises is shunned unintentionally or perceived as too difficult and would cause the ‘flow’ within the system to slow down to accumulate or even stop.  Most therefore stay as self-employees for life which makes for ‘things’ to be easier.
        • Citizen businesses rotate two monthly to allow more to gain access to government purchase schemes (catering, uniforms, supplies, etc.) before relinquishing the turn to the next ‘business’ in the queue.  We shame or shun who otherwise overstay their dues or are engaged in sales (who are too active and over the top and are perceived as being impatient and rude to wait their turn and is therefore callous and uncultured) or even make claims they are engaged in corrupt ways.
        • Young women who have young children often present subtle pressures as to one is more deserving than others to receive help and to come to one’s aid by virtue of the number of children one has mothered or the shanty standards of living one has unfortunately fallen into.
        • Women who are open to offering sexual favours in return
        • The youth or the orphaned child
        • The disabled
        • The disenfranchised or the ostracized
        • The man who has fathered large numbers of children and is unemployed or is a self-employee.
        • The royalty and therefore are naturally privileged to entitlements
        • When left untreated, these creates the perfect conditions for the growth of beggary as an acceptable occupation on the streets during the day and crime by night.

THE RESULTANT REALITY OF THE ECONOMIC PRACTICE:

  1. Botswana’s real labour productivity per capita (when measuring the employed population’s output excluding value added by mining and real-estate sectors, against the total population of the country for a truer reflection of real per capita income of the country) is USD 2.2 per hour or USD 18 per day, and that is, before deducting costs of operations.  Luxembourg sets the pace as the global labour productivity leader at USD 93.4 per hour or USD 747 per day (or USD 16,437 per month).  At this rate, Botswana’s productivity (and therefore wealth) lags (falls behind by) at 30-40x behind that of Luxembourg.
  2. It makes one wonder, that in our efforts to avoid capitalism, apparent inhuman labour practices, wealth accumulation, and for that perfect equality in the distribution of income, at what cost have we done so?  Will our efforts to transform the manufacturing and industrialization sectors OR efforts to diversify the economy (from the tried and tested) gain traction without understanding the underlying forces that detract us from such efforts?
  3. The Question Is.
    • Would we rather continue this way as business as usual and dragging a burgeoning burden on the state in the process?
    • Would citizens know how big that burden is or what that would become of and cause to the state?
    • Would it help citizens of the country, see and learn what these distinctions stand for and what that would mean for them?
      Gaining such understanding in our mind would mean gaining the power in our hands.  If you can imagine it, then you can create it.

STEPS GOING FORWARD:

  1. However, this would deter organizations from worlds that practice capitalism, wanting to be a part of such an economic system.  These are organizations that grew their wealth by virtue of merits of their performance, have withstood the test of time being measured by defined standards and rates of growth of income and wealth and believed in reducing costs of production to accumulate business wealth so as to grow the economy.
  2. Interestingly, no pure socialist, pure capitalist or pure communist economy exists in the world today.  All economic system changes were introduced with a big bang approach and had to make “adjustments” to allow appropriate modifications as the situation developed.
  3. Eventually most state-run subsidies without high productivity standards, become insufficient to support the numerous social programs.  Despite perhaps, enormous aid received from outside itself, high poverty levels continues to persist, widening the gap of rich and poor, and becoming a massive burden on social programs.
  4. A reform will often aim to shift towards a mixed economy that would allow free-market mechanisms, remove government control of small businesses, lay off unnecessary state workers and make self-employment easier allowing up to 40% of the government workforce to move into the private sector, enabling the inception of income tax payment, which in turn will lead to more self-reliance.
  5. In the short-run, to relieve the income pressures of the economy, policies may be aimed at bringing in higher foreign investment. Tax-free special development zones are introduced for foreign companies to conduct business freely and allow transfer of tariff-free profits abroad, among other benefits. This may cause a significant change from the central “socialist” planning.  However, this cannot act as a substitute for it.
  6. Fundamental changes, however, will call for reforms (yes, even if it is aimed at our own citizens), designed to allocate wages based on  citizen or worker productivity.  Not rank.  Not seniority.  Till citizens see the direct link between their productivity and the national and personal incomes, the transformation will not be complete.

THE BOTTOM LINE

Socialist economies across the globe have existed and continue to progress. However, there may not be any standard pure socialist economy remaining.  Timely, fundamental shifts in programs and policies have allowed such economies to thrive and flourish – China being the world leader among them.  The ones taking a rigid stand are facing severe problems or developing parallel markets.

Source: Socialist Economies: How China, Cuba And North Korea Work | Investopedia https://www.investopedia.com/articles/investing/081514/socialist-economies-how-china-cuba-and-north-korea-work.asp#ixzz5GKkjPmXQ
Follow us: Investopedia on Facebook

REQUIRED RESEARCH ANALYSIS

FOR DETAILS OF DATA REQUIRED FOR RESEARCH ANALYSIS FOR THIS SUBJECT, CLICK HERE.

THE FULL STORY, CLICK HERE.

by sheilasingapore

When The Community Speaks … When learning is more important than education. Short Notes.

“Without learning, education will fail to deliver on its promise to eliminate extreme poverty and create shared opportunity and prosperity for all.“

World Development Report 2018 calls for greater measurement, action on evidence

WASHINGTON, September 26, 2017 – Millions of young students in low and middle-income countries face the prospect of lost opportunity and lower wages in later life because their primary and secondary schools are failing to educate them to succeed in life. Warning of ‘a learning crisis’ in global education, a new Bank report said schooling without learning was not just a wasted development opportunity, but also a great injustice to children and young people worldwide.

The World Development Report 2018: ‘Learning to Realize Education’s Promise’ argues that without learning, education will fail to deliver on its promise to eliminate extreme poverty and create shared opportunity and prosperity for all. Even after several years in school, millions of children cannot read, write or do basic math. This learning crisis is widening social gaps instead of narrowing them. Young students who are already disadvantaged by poverty, conflict, gender or disability reach young adulthood without even the most basic life skills.

“This learning crisis is a moral and economic crisis,”World Bank Group President Jim Yong Kim said. “When delivered well, education promises young people employment, better earnings, good health, and a life without poverty. For communities, education spurs innovation, strengthens institutions, and fosters social cohesion. But these benefits depend on learning, and schooling without learning is a wasted opportunity. More than that, it’s a great injustice: the children whom societies fail the most are the ones who are most in need of a good education to succeed in life.”

Download the World Development Report 2018: Learning to Realize Education’s Promise.

The report recommends concrete policy steps to help developing countries resolve this dire learning crisis in the areas of stronger learning assessments, using evidence of what works and what doesn’t to guide education decision-making; and mobilizing a strong social movement to push for education changes that champion ‘learning for all.’

According to the report, when third grade students in Kenya, Tanzania, and Uganda were asked recently to read a sentence such as “The name of the dog is Puppy” in English or Kiswahili, three-quarters did not understand what it said. In rural India, nearly three-quarters of students in grade 3 could not solve a two-digit subtraction such as “46 – 17”—and by grade 5, half still could not do so. Although the skills of Brazilian 15-year-olds have improved, at their current rate of improvement they will not reach the rich-country average score in math for 75 years. In reading, it will take 263 years.

These statistics do not account for 260 million children who, for reasons of conflict, discrimination, disability, and other obstacles, are not enrolled in primary or secondary school.

While not all developing countries suffer from such extreme learning gaps, many fall far short of levels they aspire to. Leading international assessments on literacy and numeracy show that the average student in poor countries performs worse than 95 percent of the students in high-income countries—meaning such a student would be singled out for remedial attention in a class in those countries. Many high-performing students in middle-income countries—young men and women who achieve in the top quarter of their groups—would rank in the bottom quarter in a wealthier country.

The report, written by a team directed by World Bank Lead Economists, Deon Filmer and Halsey Rogers, identifies what drives these learning shortfalls—not only the ways in which teaching and learning breaks down in too many schools, but also the deeper political forces that cause these problems to persist.

Source: Phillip Hay, Patricia da Camara, Huma Imtiaz  (2018). World Bank warns of ‘learning crisis’ in global education. World Bank. Available at: http://www.worldbank.org/en/news/press-release/2017/09/26/world-bank-warns-of-learning-crisis-in-global-education [Retrieved on 19 May 2018].

GENERAL TALKING POINTS OF INTEREST (For now):

  1. To not assume that if there is education, there will be learning.
  2. Learning is not the same as teaching.  Learning happens when the learner makes the action of learning the primary responsibility of the learner, just as  teaching is the primary responsibility of the teacher.
  3. You can have teaching and no learning as the article above here illustrates.  We need to accept that is possible.
  4. Yet one could have learning in the absence of teaching.
  5. Learning takes the student much farther along, with less resources, than any amount of teaching can do for the the learner.  School and principals and student grades improve at the rate the learner seeks out learning.  Infrastructure is not the primary driver of learning.  Curiosity and the willingness to learn is.
  6. In the world of learning, we stop using the word ‘student’ and switches its reference to ‘the learner’.
  7. The student goes much farther in their journey of learning when they have piqued their curiosity about what they are learning.  That is an almost mesmerized attention to learning.  They are learning because they want to rather than they have to.
  8. All children have this innate capacity to be curious.  Often it goes unnoticed by the parent as it typically happens in their absence and not in their presence or is picked up when the child does something ‘wrong’.   And so as adults, most of us miss seeing it as it happens.  We have all gone through it ourselves but we abandoned the notion of what it is, when we got what we had wanted as a result of that process or were punished for exercising it.
  9. What is the true nature of a child’s mind that piques their interest and become mesmerized (be they clean (or unclean) interests) to want to learn?  Totto-Chan is a book written in modern times set within the context of World War II in Japan, that explores classic ideals such as curiosity, innocence, shyness, inquisitiveness, confusion, happiness and sorrow that represent some of these traits (all of which are emotional, and less mental, spiritual and physical) in nature) that promotes the mind of the child to want to learn.
  10. A learner then soon discovers that being on the journey of discovering and learning is far more exciting to be on than arriving at their destination (having learned and scored grades).  The learner then can’t wait to get on to the next big journey and it did not matter to him whether his scored grades or he did not.  That is not relevant to the learner.
  11. Once a learner discovers the joys of learning for its own sake (as opposed to ‘not wanting to fail’ or not making the grades for advancing to the next stage), the systems begins to realize it is becoming difficult for it to keep up with the pace at which learning is happening for the learner.  The learner will keep exceeding the expectations that the teachers have set for them.  The learner reaches his grades only by as far as he or she is willing to learn.  Anyone else who believes that the effort to improve grades lies elsewhere, or with the teacher, is sorely mistaken and does so at the expense of incurring huge costs to the state (as highlighted by the article above here).
  12. Now, the question is:  Where would a child imbibe the values of learning?  Or, where could the child lose such values?  What would allow or encourage the mind of the child to become mesmerized by learning?  True childhood means the curiosity that piques a child’s interest for learning.  Would that be at the school or be at the home?

REQUIRED RESEARCH ANALYSIS

FOR DETAILS OF DATA REQUIRED FOR RESEARCH ANALYSIS FOR THIS SUBJECT, CLICK HERE.

by sheilasingapore

When The Economy Speaks … ICT Graduate Unemployment Is Just the Tip of National Unemployment Iceberg

DEFINING THE RESEARCH SPACE

It is not difficult to create employment.

It is harder to keep unemployment off!

Do you wonder what came of the billions (possibly trillions) spent by countries both as governments as well as private sector (including foreign direct) investors, across the world, decade after decade (let’s say, now going five decades) with the purpose of creating employment, and then learn to find that unemployment persists relentlessly , companies shut down at the snap of a global economic meltdown and national economic growths continue to take hits, year after year?

Is this story familiar?

Why does this happen?

I am not alluding that the money is siphoned off. That is not where I am going. But, yes, there is another kind of ‘siphoning’ happening.

In the meantime, of course, governments face angry faces of unemployed constituents and so nations react by wanting to see both governments and foreigners ‘continue to invest’ in it.  Why does the issue persist?

Often, when an issue persists, it is a sign we have made the choice to avoid some difficult and hard decisions.  These hard choices  include questions such as what is causing our innate ability to be honest with ourselves, and that includes bearing criticisms, taking a hard look at ourselves (instead of cowing others into submission or hustling as needed), being patient, persistent and being sufficiently resilient to spring back from setbacks, diminish over time.  All of which are factors that are critical to the ability of a country to succeed as a nation in growing its economy.

So, which one do you think comes first?

Nurturing our capacity to be patient, to persist and be resilient and being frugal (doing more with less (not spending no more than 10% of the margins for personal spending while the business is still trying to stand up on its feet (and generate its own income) is the first rule of business)) despite the odds stacked up against us?

OR

Needing to seek investments?

What is destroying our ability to grow these innate capacities for us?  These and more questions are explored in this article.

Botswana’s new leader wants to shrink the civil service, sell state companies and cut red tape as he targets increased foreign investment.

President Mokgweetsi Masisi has identified reducing the country’s reliance on diamonds and creating jobs for the almost one in five workers who are unemployed as his top priorities since taking office six weeks ago.  Private companies will have to take the lead, he said in a May 14 interview in his office in the capital, Gaborone.

“The government in and of itself does not really create jobs,” Masisi said. “It is not my desire to grow the public service any bigger; if anything, it is my desire to trim the civil service so we are more efficient, we are leaner, meaner, and we can do business and we are more attractive to the private sector for them to invest.”

Source: Agency Staff. (2018). Botswana wants to shrink civil service so privatisation can grow the economy. Bloomberg. Available at: https://www.businesslive.co.za/bd/world/africa/2018-05-16-botswana-wants-to-shrink-civil-service-so-privatisation-can-grow-the-economy/ [Retrieved on 17 May 2018].

OUTLINE:

  1. THE OVERARCHING SYSTEMIC STRUCTURE OF UNEMPLOYMENT
  2. THE STORY OF SUPPLY OF LABOUR
  3. THE DIGITAL USE DIVIDE:  A SPECIAL MENTION
  4. THE STORY OF DEMAND FOR LABOUR
    1. WHEN GOVERNMENTS INTERVENE
    2. WHEN PRIVATE SECTOR INTERVENES
    3. THE UNEMPLOYED DIGITAL USE (ICT GRADUATES) EXPERTS – WHEN THAT HAPPENS – A SPECIAL MENTION
    4. BUILDING INDUSTRY SYNERGY: VALUE CHAIN MATRICES
  5. THE UNEMPLOYED DIGITAL EXPERT (OR ICT GRADUATES) – A SPECIAL MENTION: WHY IT HAPPENS?
  6. WHEN DEFINING THE TRUE NATIONAL UNEMPLOYMENT NUMBERS
  7. REQUIRED RESEARCH ANALYSIS

GENERAL TALKING POINTS OF INTEREST:

THE OVERARCHING STRUCTURE:

Systemically, the growing pool of unemployment today is as the result of the different rates of change that exists between the levels of annual births from as far back as twenty years ago and the capacity of annual jobs created today.  Why twenty years?  That is the average age before someone becomes ready to join the labour market.  The changing rates of unemployment is determined by rate at which these two factors change over time relative to each other.

When the numbers of Jobs Created Today < Children ‘created’ from twenty years ago cause the number of persons that are unemployed adds on to an existing pool.

WHEN
Growth Rate of Births From Twenty Years Ago (A)
IS GREATER THAN (>)
Growth Rate of Job Creation Today (B)

= GROWING RATES OF UNEMPLOYMENT Today (C)

A = SUPPLY OF LABOUR
B = DEMAND FOR LABOUR

And so,
Growing Unemployment = When Growth of A > Growth of B

Meanwhile
Growing Employment = When Growth of A < Growth of B (it would now have the capacity to absorb increasing immigrant employment).

And of course,
Full Annual employment = When Growth of A matches the Growth of B

SUPPLY OF LABOUR

The factor that contributes to the supply of labour in any nation is the rate of births.  Yes, it is dependent directly, on the number of students who graduate from the education system but how wide that pipe is, would depend on the rate at which the nation populates or replaces itself.

It would, however, not be completely accurate to say that had the overall population numbers not increased substantially over the years, that it must mean that the rate of births has not increased.  It could mean instead that the rates of attrition (deaths or migration) or somewhat higher than the rates of births.  Hence, the theory would have to be tested before being confirmed that it is so.

Couples within an intact marriage often would have a better chance at influencing the rates of births within their combined capacity to provide for the children.  However, in an impaired marriage (and I am not referring to visual or hearing impairment) or a marriage where the couple has lost or is losing their ability to be committed to each other, as a couple they begin to produce children outside of the marriage.

As males become increasingly sexually active with several partners (or with the same partner), he then tends to produce more female progeny.  A higher proportion of females within the system would mean a higher propensity of the population to increase its birth rates and therefore even further female offsprings (testament to polygamous communities typically living off on arid lands).  It does so, at times, at runaway rates i.e. populate at rates faster than their capacity to provide for it.

Of course, when the males present their progeny within an open system (marriage or a polygamous community), where everyone sees the number and the gender of children he has produced, it is much more evident as a community and as a nation the impact such behaviours will have on unemployment and job creation in the future.  When he is, however, unable to do so or such information is limited to immediate family members or the village, impacts of such acts become less discernible to the nation as a whole.  Governments seem to be caught unawares of the extent of the issue till the election times are upon them.

THE DIGITAL USE DIVIDE:  A SPECIAL MENTION

The Digital divide is a term that typically refers to the gap between demographics and regions that have physical access to modern information and communications technology, and those that don’t or have restricted access.  This technology can include the telephone, television, personal computers and the Internet.

But I would like to make a special case for this divide here.  The Digital Use Divide. One perhaps that was brought on by man’s own decision to avoid the hard choices when he had to make them.

Think back to the time when we were choosing to decide to whom should a topic such ICT to the population?  The old ones?  The young ones?  Which one did we choose?  We thought, it was easier to teach ICT to young minds.  Teaching the old ones would be like trying to teach old dog new tricks.  It will be painful and take a long time.  That is harder.  It takes time and resources’.  Well, moulded, we sure did.

Except, what becomes the consequence of this choice?  It meant that the old ones except in the case of passive use of the ICT are fearful of engaging ICT actively for purposeful and creative uses.  They did not want to come across as incompetent or worse, stupid.  So what will be the result of older generation trying to work with the younger ICT graduate?  What would we do?  Did you say, we could ‘push them away’.  This way the older ones can avoid dealing with the pain of that fear of using ICT.

DigitalDivide_Infographic
Figure 3:  Digital Use Divide

Adding, to this, persons who would typically venture into small businesses in the private sector or set up their own businesses would be persons (typically the parents of the millennials) who did not do as well in school particularly in the  areas of mathematics and science.  They have found it difficult to keep a job since they are not able to do most jobs that are common in the new knowledge economy.

On the other hand, an ICT graduate would have had a much easier time with these subjects, and appear to come across as the ‘know-all millennials who do not care for the ones who do not understand maths and science subjects’.  They would then be perceived as a threat to the older ones.  These experiences, can often push the  wedge in the divide between the two, even further, and often generations apart, from each other.

The trick for now may lie in the young ones learning to make a very conscious, but not obvious, choice to ‘hand-hold’ the older generation along in crossing this bridge of divide that exists now between them.  Very patiently and learning not to tread on tender emotions, when doing so.  Should the two generations figure ways to build that trust between them, we could possibly enter a new era of interacting between the owners and enablers of the economy that would enable them to expand their market, manufacture bases and export capacity to the region, all of which requires the ICT environment to flourish.

It would also mean opening opportunities up for several other careers such as sales, accounts, finance and marketing to take off in the industry.  Should we, however, not be successful in doing so, we face the risk of riding off into a bleak future of seeing the pool of ICT unemployed graduates grow or eventual dwindling of numbers willing to enter the study of the profession or a draining of their talents out of the industry or worse off, the country.    That would present a loss of investments by the country in their learning and therefore a possible alternative future for the country.

What is your view?

Now, going back to the point on the supply of and demand for labour, just a bit.  The trick is both, the supply of labour (bearing of children) and the demand for labour (creation of jobs), is essentially ‘managed’ by the same person, the man in his 30s to the 50s.  When he figures how he would create more jobs than children, he, more than anyone else effectively wipes out unemployment for his country.  Not the government.

DEMAND FOR LABOUR:

– WHEN GOVERNMENTS INTERVENE

When governments create jobs (in government) to absorb the unemployed, they do so at the expense citizens pay to the state coffers or from revenue of sales of raw materials extracted from the ground.  It typically behaves as a cost to the overall system with low returns.

Additionally, these jobs do not fundamentally change the structure of the economy, in particular develop the primary sector of the economy i.e. the production of natural raw materials by its citizens.  This sector not only has the greatest capacity to absorb employment that will be needed for sustained growth of the economy over time compared to manufacturing or industry and service sectors, but it serves as the fuel that will keep the economy burning to some extent, literally, and therefore growing its GDP (the ROI on government and private sector spending).

Investing without the  need to sustain the investment is a sign that the country is primed for investments in the sector as a result of solid growth of the supporting industries.  However, should a country after, tens of years (decades) of investment injections by corporations and nationals from both within and outside the country and in-spite so, continues to rely on such injections to sustain its growth, it then speaks to a fundamental breakdown of the supporting set  of industries (primary for industries and, manufacturing for retail) needed to support sustained growth of the ones above it.

– WHEN PRIVATE SECTOR INTERVENES

Notice as in a pyramid (see figure below) the layers at the bottom of the pyramid of economic structures provide much greater capacities to absorb employment than the ones above it.  The math is easy.  If there are 30,000 personnel in the services sector, then we are looking at say, 100,000 persons that would be needed within the agriculture raw material production strata to grow and support the layers above it.  The services and the government sectors will not be able to absorb 130,000 persons when there is little persons and materials to sustain the growth profitably from within the primary industries.  Also refer to Figure 1 below for reference of a country till in recent times that has absorbed large numbers of the population within the primary economic agriculture sector.

pyramid-of-classes-in-egypt.jpg

The private sector creates new jobs when it has the capacity to generate revenue (notice I did not say funding) in a sustained manner at rates faster than the costs of production of the organization.  When the change between the two grows a margin such that the growth in the margins itself is sustained, then the organization is able to create new jobs in a sustained manner for the economy.  This does not, however, happen when its development is based on the principles of socialist economic systems where we strive for equality in the distribution of wealth (that poses risks of rising costs).  It only happens when the rates of growth of revenues inclines and rates of growths of costs decline.

What would influence that?  The current set of employees do.  From management and that includes the boss to the cleaner.  Companies do not create employment. Employees do.  When everyone in the company helps to grow (rather than consume) the margins, they, in turn help the company create margins that help it to expand and therefore recruit more employees in the future.

 When we understand that, in principle, anyone could start anything from anywhere.  There right there is how new jobs become available to us today from the past.  However, when a new employee joins asking what is it in there for them, or carving out their own niche, that’s a warning bell.  It is the start of that company not only losing potential new employees but stand to lose their current jobs.  When there is unemployment today, this suggests that this has been happening from the past.

THE UNEMPLOYED DIGITAL EXPERT – A SPECIAL MENTION – WHY IT HAPPENS?

When graduates or trained ICT personnel continue to stay unemployed within the nation, it is a sign the following are happening:

  • A numbers mismatch.  This is a case of where there are more graduates created (SS) than there are jobs inherently (naturally as in a free market system, as opposed to forced employment creation (those created by government in response to appease an unhappy voting public)) available for the sector.
  • Skills mismatch.  Where the employers are unsure or even feel threatened to hire ICT graduates.  This is a case where employers do not understand what ICT graduates can do (refer to the digital divide segment above, where this elaborated further) for them or what that job would do to affect the bottom-line of the organization.  This gap is particularly noted in the small, medium and micro-businesses.  If these businesses make up the majority of the populace, then ICT graduates who come from that same populace (who are children of that population), will inevitably find themselves at the short-end of the stick.  Their parents are unlikely to open jobs to them, except on compassionate (for socialist reasons) grounds, unless the parent sees a very experienced ICT personnel (who is at this juncture is not a graduate) who can convince they can and will change the bottom-line for the organization.  The small businesses make up the major employers of any country.  Each one of them may not be anywhere close to the size of your national network chain employers, but they are more important as a combined system in terms of numbers and impact.  If this sector does not change its mind towards ICT employment, doing anything else to change it will not make any significant difference to the country.
  • When other graduates are employed gainfully, ICT graduates are better placed to be employed as well.  They usually do not make a substitute for a missing production base, unless the ICT graduate is just as skilled in non-ICT-based jobs, such as cooking food products, as an example, in which case, they would then know how to mechanize the process.  When they don’t. the job for which they are trained for, ceases to stay relevant.There is a systemic breakdown of the economic sectors within the country.  ICT sector employment does not create or conduct the actual jobs needed to generate revenue within the economy.  They facilitate an existing process to become more efficient particularly when the volumes of trade are significant.  The presumption is a process or a window exists that needs to be made more efficient between factors of production and management of production.  This is caused by two interrelated factors:
  • This means sales and revenues are generated particularly in a vibrant manufacturing and agriculture sectors.  However, when markets are dull (as in what happens when there does not exist a strong set of primary and secondary economic sectors) and the economy is not hiring factors of production (jobs in other sub-sector, e.g. milling, cooking, producing furniture, clothes, and so on) in the first instance, and in which case, this window for the ICT sector becomes narrowed significantly.

So which one is your reason?

BUILDING SYNERGY OF INDUSTRIES: VALUE CHAINS

The easiest way for an opposing political party to bring a ruling government down  is, noteworthy enough, not at the elections.  It is slowdown, low productivity and tool down at the workplace, often by employees that are party to the opposition.  This fundamentally does one thing.  It works at gradually eroding the synergies needed in an economy to keep the economy well-oiled and running effectively.  These are its  value chains.

This does not change because the ruler is no longer at the helm and had to leave office to his opponent.  All it does do is the see the camps trade places.  But nothing changes fundamentally until, the lines between the ruling and the opposition fade away and the people of all creeds and parties decide to join their hands, hearts and minds as one.  A broken industry value chain is a sign of the breaking down of its people of the nation.

WHEN DEFINING THE TRUE NATIONAL UNEMPLOYMENT NUMBERS

Governments and nations can only consider patch works of correcting unemployment as a nation when it looks at the narrowest definition of unemployment.  To consider working with the real rate of unemployment, it would require understanding the state of unemployment that exists at its fullest extent within the nation.  Refer to Figure 3 to determine such a figure.  Remember as always, it is not the primary responsibility of governments to absorb these numbers, if they are high.

These numbers need to be understood as a nation and dealt with as a nation to turn the issue around.  The ruling party or the government can bring it to the awareness of the nation but it is still the responsibility of the nation in deciding together what it will do next as a nation.

To note, unemployment in the region cannot be ruled out as part of the unemployment structure within the country.  We cannot run away from this reality.  A true picture of the country needs to include the true picture of unemployment in the region that needs attention.

Homelessness, crime, substance abuses, domestic violence, divorce rates, growing single-parent households and reliance on government programmes are just making up the tip of this ice-berg.

Vietnam's Employment Figures 1990-2009
Figure 5: Share of employment by sector

Source: Tuyen Tranh and Tinh Doan. (2010). Industralization, economic and employment structure cbanges in Vietnam during economic transition BCollege of Economics Vietnam National University, Hanoi. Available at: https://mpra.ub.uni-muenchen.de/26996/1/Vietnam_industrialization_and_employment_structure_changes.pdf [Retrieved on 17 May 2018].

Unemployment Rate.png
Figure 6:  Defining Real Unemployment Figures within the country / region

REQUIRED RESEARCH ANALYSIS

FOR DETAILS OF DATA REQUIRED FOR RESEARCH ANALYSIS FOR THIS SUBJECT, CLICK HERE.

FOR STORIES RELATED TO PRODUCTIVITY, CLICK HERE.