As demand for labor grows and outstrips supply, we will have full employment and more. When, however, a nation experiences growing numbers of persons not employed formally by the economy over decades, there is now a systemic reason. Demand for labor is not matching supply, a situation that is not uncommon in Africa.
The cause for the sustained mismatch of the two variables is therefore no longer a result of the localized lag in the processes or lack of management capacity or even the lack of resources. It has at this point, gone beyond corrections that need a deeper understanding of interrelationships that are no longer obvious. That is the hard part. The good news is, that the solution to turn it around will require little effort. The drawback is it requires concerted and persistent attention from all sides of the issue before it turns around. The more who “sees it”, the better the turnaround will be for the nation.
So why has unemployment stayed resistant as a national issue?
Here are the key learning points in the study of national unemployment (for the results, click here) revealing the onion. The onion describes the tool that unpacks the nature of dynamic interrelationships (despite time and space) that control persistent issues.
Economies don’t go up or down.
The wealth the economy generates may. An economy would act just as a train or let’s say a ship would. It is machinery. That is well-designed to evolve with the times and withstands the strongest changes that winds and the ocean’s currents would bring to it. The stronger the machinery, the less likely it will bowl over by the winds of change.
Most concepts or the idea of developing an economy describes the point at which it generates wealth. The classic is as follows. The input. The process. The output. Consequent to it, the economy generates wealth for the persons working in it and for the family members who are not working. The government of nations whose economy generates money collects taxes against wealth acquired by corporates and individuals within the economy. This is so as to have the resources to create services for its citizens. If the economy generates more wealth, the government earns more, and so on.
What most concepts of the economy do not talk about is the “gas pipe” when as it grows, it reinforces the machinery of the economy and so feeds back on itself to keep growing.
In a study of the economy that looks through the lenses of Systems Thinking, the study works at identifying key ways a nation influences the economic machinery. Does it gear up sufficiently so as to absorb the population of its working age? The result, of not gearing up will force a situation of severe or acute unemployment in the country. That is the point of departure for the following study.
It describes three interlocking parts of the nation, such that when they work hand-in-hand, the result is as the population grows so would the economy and therefore create a ship that becomes broad-based, well-oiled, and sturdy in the process.
As you move through the study, pick out what you see as the tripartite nature of these interlocking sets of factors, have a discussion, and reach an agreement on what they could be and the extent to which they may be happening for your nation. Happy discovering!
When there is persistent unemployment, the rate at which the country produces children and when twenty later and they are ready for the job market, the numbers of supply at that point in time outstrips the capacity of the country to create and provide adequate job placements for them.
The official unemployment rate is around 20%. Those, however, not employed formally, is hovering more so at 60% with the numbers at 2011, standing at 827,848 persons (as per the latest census year data).
SUPPLY & DEMAND – THE STATISTICS
This means the ratio of supply to demand stands at 10:4. There are four jobs available for every ten persons of working age. The current capacity of the country to create jobs for a working-age population size of 1,439,500 is 611,652. The dependency rate of the population of 2.2 million on the number of employed persons, therefore, becomes 2.4 to 1. The one who is employed supports himself and 2.4 others. In Germany, that ratio is 0.6.
THE STORY FROM BIRTH, I MEAN BIRTHS
There is an 80% chance a child is born to an unmarried parent. The marriage rate in the country is 20%. And so, the unmarried woman is successful (StS archetype) at bearing more children, sometimes to different male persons, than the married woman is. Given also that 6 out of 10 times, she is unemployed, she subsists on allowances provided both by the state as well as up to several men in her life for the children that she bears. She does this, as she seemingly meets family and community obligations at the same time. Of course, these inevitably create tensions and therefore conflicts at familial as well as at community levels (Esc).
With fathers being absent and less than stable family environments present, the child is likely not to be as successful in developing core and certainly advanced skills in subjects such as mathematics and sciences. Those are not core the languages spoken in the house. And so, 75% of the tertiary educated population have soft skills (StB). That means there is an increasing leaning towards feminization of the education system both by the learners as well as the administrators which continues to get entrenched with time.
About 10% of the graduates have skills in professional areas related to sciences or applied sciences (e.g. engineering (6%)) and 7% in hard sciences. These represent figures of the tertiary educated. This could mean there are a lot more out there in the population without the requisite skills and discipline to carry out jobs that require skills in these areas.
THE IMPACT ON THE CORPORATES
With at least 80% (63% graduating with soft science skills at tertiary and another 12% with business skills. This number will be much bigger when we compare) of the population without a strong anchor in mathematics or sciences, this will have an adverse impact on the capacity of the population to keep their personal lives and enterprises ‘financially healthy’ (the capacity to live within one’s means and to generate profits) and the capacity to anchor their learning capacities and much less growing but more fundamentally build a robust multi-level economic sector structure that can absorb employment.
This pushes the country’s inflation figures upwards (value of the money keeps eroding – it is gradual now, but its decline is definite (FtB)) as both formal and informal retailers look for ways to raise income by raising their prices to provide the unemployed in their families, Couples take longer to be married and not as long to stay married (DG). Issues of substance abuse tied with its tendencies to over-promise and under-deliver are never too far of. An unstable personal life also means an unstable career life. The reverse is also true.
THE IMPACT ON ECONOMIC SECTORS
Both the agriculture and manufacturing sectors today persist in the red zones – they do not generate profits. To turn it around, would mean requiring a critical number of personnel skilled in mathematics and sciences among their ranks to help cause these two sectors to grow consistently. (G&U)
Both agriculture and manufacturing today persist in the red zones – they do not generate profits. To turn it around, would mean requiring a critical number of personnel skilled in mathematics and sciences among their ranks to help cause these two sectors to grow consistently. (G&U)
Here is the part of the pyramid that stands on the shoulders of the primary industries and provides the shoulders for those above it for the tertiary sector. This is not a space that is run by persons interested in just putting food on one’s table. It is a space that learns to be the best so that they are working together at putting food at others’ tables as well. Think of working as teams. Not individuals. Even when we may start small, that does not stop us from thinking of growing big.
Countries that find themselves on the short end of the stick of fertile lands:
- When the land is infertile, we would more likely breed livestock, rather than grow crops. Check out anywhere in the world, and you will see the same frame persists. We believe, and rightly so, livestock would survive better than crops, and more so in increasingly harsher climates. However, these wipe whatever little is left of the vegetation out on those lands, removing the roots of vegetation completely, which loosens the soil, and therefore, deserts grow.
- We extract raw materials rather than produce raw materials. But what that means is more water used in washing the minerals;
- We produce alcoholic drinks and build brewery plants. But did you know that it takes ten cans of water to produce one can of beer? So, don’t tell me that there is no water.
- We do not focus on building any one company to a position that it can grow by itself, as it takes time, and so feeds our fear of putting ‘all the eggs in one basket in the case that we need to hedge ourselves for increased disruptions in the economy. However, we often do not build industries with time, that way either.
- In the face of droughts, compared to the above industries, we would begin to allocate less water to horticulture industries. The very products that when we produce them, feed the rainwater (not just the water) cycle. Instead, we would plant warm crops. Warm crops create warm weather and therefore erratic weather. And kills the very industry that would have reversed and created more fertile lands. And so, what happens of their profit levels? Can you see if these graphs, could be any different?
THE IMPACT THE SYSTEMIC ISSUES HAVE ON THE CAPACITY OF THE ECONOMY TO GENERATE WEALTH
There is, therefore, a crowding of job hunters and skills-seeking at tertiary (retail) economic sectors and government (refer to pink and light blue portions of the picture on the left) limiting the growth of and therefore creating a virtually absent secondary (manufacturing) and primary (raw material production) sectors (LtG).
This, in turn, causes the economy to rely more so on industries that extract (mining and its dependency on technology) rather than produce raw materials. The latter, however, should it grow and green the country also has the effect of reducing erratic weather systems which would mean the capacity of the country to produce plants and its by-products will improve with time. However, when they do not happen, those two sectors stay missing in the economy.
For each person that stays unemployed, the loss per capita income per month is 5,848 pula. That is the same as 55,956 pula per annum or a staggering 5 billion loss to the population. Instead today, the per capita income per month limited to 4,320 pula instead of growing to 10,168 pula (that exceeds even that of South Africa’s 8,983 pula) per month per capita.
Most of what’s retailed in the economy is based on products that are produced and manufactured from outside the country, This further erodes the value of the money the citizens would have, to invest back in their economies (ToC).
THE IMPACT ON CREATING SYNERGIES AS INDUSTRIES
The government is consciously aware of the need to expand the agriculture and manufacturing sectors (the portion colored yellow represents the 60% unemployed) but remains somewhat oblivious to the extent the point raised in paragraph six(6) above here would have an impact on developing their economy. There is instead a situation of lots of small enterprises, each pitting itself up against the other (AA), making it difficult to access and create collaborative spaces where synergistic works can happen. These are works that are needed to create robust supply chains for the region that can build entire industries of the economy.
Does the point of pitting one up against the other sound familiar? When men and women stay in conflict, the story as we know in the outline here would keep repeating. When their children grow up and become men and women themselves and they leave and stay apart from each other, when their children, in turn, grow up, how much of this story could change?
When we grow that one intimate relationship between ‘strangers’, as it were, who would then go on to become long-standing lovers for the rest of our lives, it begins to become very difficult to throw a spanner in the works on building other ‘more strange’ relationships. Yes, even so, or if I may so, more, for business reasons. Don’t get me wrong. I am not referring to the exception. Just the rule.
What then of our economy? Our wealth?
What is “driving” the economy today? Who is behind it? What beliefs does it hold? Would that be The Divided We (individually) Are Better Off (but not see the cost and downfall of the whole economy)?
What if it was The United We Stand? What would that look like?
BOTSWANA NATIONAL POLICY HACK:
- In 2011, the country created and had (retained) 611K jobs (60% of the working-age population)
- In 2017, the number of formally employed is about 400K, the majority are in the government and retail sectors
- The economy is not supported but remains suspended and so leads individuals to turn to trade and entrepreneurship yet are unable to support themselves without government support (see diagram above)
- The loss per capita income per month when 60% of the working age persons stay unemployed is 6K pula (per month)
- The loss of GDP (per annum) 5B pula
- Building of broad-based economy that is not suspended but supported.
- The widest part of the pyramid absorbs the greatest portion of a nation’s employment. The sectors at the apex are the narrowest.
When corporations grow, jobs grow, and not without it happening. And then wealth grows. Start-up companies are like seedlings and need to be nurtured before they can sustain people. Too much feeding will also cripple it. Slower at first so that the roots grow out first and anchor within the market before the tree becomes huge and skilled to make enough food to make more fruits for all.
STOP: Thinking of putting food on my table. And my survival.
Creating jobs is a consequence/result of the above not the focus.
Companies are meant to create wealth for me.
START: Thinking of putting food on everyone’s table.
VISION: Prosperity for all.
- To the extent, biological families stay intact
- To the extent the young master their STEM, particularly English, Mathematics, and Science (EMS).
- To the extent, the economy develops captains of industries in the agriculture and manufacturing sectors of the nation’s economy
- Every member of the nation plays an active role voluntarily
- Messages passed on by role plays, cartoons, media stories
- Allow the member countries in SADC to appreciate the opportunity cost of large numbers of unemployed persons within the region. For every year, 60% of the working-age population who are not employed formally, represents a 5B loss to the nation’s economy or 6k per capita per month.
- Determine a full list of goods and services that can be provided to the world. Build a matrixed goods supply chain as a region based on goods demanded in the region and exported to the continent and the world. Figure where Botswana plugs in based on the efficacy of the service and economies of scale that creates margins that grow corporations and so jobs.
Dialogue on understanding the results by:
- The Nation
- The Kgotla, Chiefs & VDCs
- The media
- The Community
- The intact family – both parents who bore children – no coercion – just sharing the picture and hopes