Namibia: Job Losses Continue As Economy Struggles

(file photo).

The construction, wholesale and retail sectors continue to feel the pinch of the limping economy, with 236 jobs having been lost in these sectors from April to the end of June.

This is reflected in the latest figures on employment in Namibia which were released by the ministry of labour in a quarterly report on labour issues yesterday.

In the wholesale and retail sector, 122 workers were retrenched during the period from April to the end of June, the ministry reported, while 114 people lost their jobs in construction during the same three months. The two sectors have shed 530 jobs over the six months from January to the end of June this year.

The Namibia Statistics Agency's figures on Namibia's gross domestic product during the first quarter of the year indicated that by the end of the first quarter of 2019, the economy had contracted by 2%, compared to its size a year earlier.

The statistics agency identified key drivers for the contraction as construction, which showed a year-on-year decline of 27,8% by the end of the first quarter of the year; wholesale and retail trade (-6,7%); and agriculture and forestry (-6,7%).

The deterioration was observed across major sectors, with more than half of the sectors posting negative growth rates.

Labour expert Herbert Jauch commented yesterday that it was stunning to see a sector collapsing while policymakers did not find it necessary to intervene. "Instead, they convene high-profile meetings and conferences that just repeat the same things but do not lead to a conclusive outcome," he stressed.

Jauch said the decline in the construction sector was nothing new, and noted that for the past three years, the Metal and Allied Namibian Workers Union (Manwu) had written to the government, the finance minister and the president to ask for support for the Namibian construction industry.

"Some of the big infrastructure jobs must go to local companies which have fair labour standards and have the capacity to sustain big projects, and then they can create the required job opportunities," Jauch said.

"It often fell on deaf ears, as the government did not respond," he added.

Given that Namibia has experienced about three years of economic decline and the job shedding that goes with it, the buying power of Namibians has been reduced as people get retrenched, or just get temporary jobs, Jauch remarked. He said as more people lose jobs, there would be less buying power in the economy and less demand for consumer goods, creating a downward spiral.

The situation was not surprising, though, as anybody could have detected years ago that interventions which could turn the economy around were needed. In construction, this has unfortunately not happened, he continued.

Manwu general secretary Justina Jonas told The Namibian yesterday that the union had not been quiet, and that last week it indeed called for all the projects emerging from the economic growth summit earlier this month to involve local companies.

"We are pushing that all these foreign investors involve local companies in their work through joint ventures for capacity-building, and to keep a portion of the money generated within the economy to stay here," she stated.

Jonas said Manwu also wrote a letter to the president last week to outline the same issues, as the union felt that its efforts have not been reaching the relevant offices.

The labour ministry stated in its report yesterday that it "is prudent to report that 485 employees were laid off by 68 employers this quarter".

The forestry, fishing and farming sectors recorded 58 retrenchments, while mining and manufacturing have ditched 68 workers from March to the end of June.

In the financial sector, 41 jobs were cut by four companies.

"Retrenchment continues, as the worrisome state of affairs still haunts the country as it impedes the efforts of reducing unemployment as most of the retrenched employees are joining the pool of unemployment," the report stated.

The ministry registered 2 641 new jobseekers, made up of 2 267 unemployed jobseekers and 375 under-employed jobseekers.

However, the ministry only managed to secure employment opportunities for 195 jobseekers. The fishing industry had most jobseekers placed (117), followed by wholesale (23) and agriculture (21).

During the last financial year (2018/2019), which ended on 31 March, 4 313 retrenchments were recorded across all economic sectors.

The continued downturn in economic activities as observed is attributable largely to weak consumer demand for goods and services, as well as the impact of the drought exerting further pressure on the disposable income of households, the Namibia Statistics Agency has stated.

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