Corruption - A social disease (Part 173): Namibia the cross roads

Corruption - A social disease (Part 173): Namibia the cross roads If you cannot provide for your family, you tend to lose your self-respect and dignity.

The third trend that will be discussed in specific relation to investment is the unemployment trend.

Uncertainty about NEEEB and its long-term impact on investment as well as corruption scandals of increasing magnitude and the resulting waste of resources, cause increasing uncertainty about the ability of the economy to create employment.

The first Namibia Labour Survey was conducted in 1997, and at the time 146 899 people were subsistence farmers (Schade & Amunkete).

This number decreased to 112 463 by 2018 according to the Namibia Statistics Agency (NSA).

In 1997, 145 000 people were employed in the agriculture sector. By 2008 this number decreased to 63 723.

Surveys conducted thereafter did not make a distinction between employment in the agriculture, forestry, or fishing industries (De Klerk).



EDUCATION AND

EMPLOYMENT

From 1997-2008, unemployment among those with tertiary education was close to 0%, whereas unemployment among those with basic education decreased from 56% to 41%. By 2014 the unemployment rate among those with no schooling was 21.1% (34.5% in 2016 and 28.6% in 2018). Unemployment among those who completed primary to senior secondary schooling averaged 30% (36.2% in 2016 and 35.8% in 2018).

During 2014, unemployment among those who completed a certificate or diploma course was 18% (18.9% in 2016 and 33.3% in 2018), university degrees 6.9% (16.8% in 2016 and 14.3% in 2018) and postgraduate diplomas and degrees 0.9% (4.6% in 2016 and 9.5% in 2018).

From 2014 onward unemployment rates increased at all levels of education, but much more at higher levels of education, a 107% increase for graduates and a 955% increase for postgraduates, than lower levels of education (35.5% for unschooled and 19% for schooled). Although unemployment is becoming worse for all Namibians, more educated Namibians are more adversely affected.

The number of postgraduates in the available workforce declined from 20 844 in 2016 to 20 306 in 2018 (NSA). Although a modest decline, one would have expected this number to have increased at the same rate as the growth in the number of graduates i.e. at 31.5% from 2016 (52 640) to 2018 (69 261).

The decline in the nominal number of postgraduates is an indication that Namibia is experiencing a brain drain. The latter can probably be attributed to the increasing difficulty with which higher educated persons find employment, or an increase in such persons generally looking for greener pastures in other countries (De Klerk).

Other contributors could be a high crime rate, high taxes (Namibia is one of the highest- taxed countries in the world, relative to GDP), discriminatory laws or a host of other reasons that are rendering Namibia an unattractive country for citizens and investors alike.



NEEEB'S IMPACT

It is critical that the probable impact of NEEEB on future employment be analysed.

According to the 2018 Labour Force Survey, there are 214 693 people employed in private companies, enterprises or co-operatives in Namibia. Assuming an average of around 10 employees per employer, there are probably not more than 20 000 companies active and employing people.

The nature of the size of these companies, and the number of people they employ displays a pyramid shape.

There are a small number of large companies at the top (e.g. listed companies), a larger number of mid-sized and an even larger number of small companies, including lots of micro enterprises.

Many of the large and medium companies are public, not “white owned” and/or have “previously disadvantaged” persons or institutions as shareholders. There are some exceptions, but that is to be expected – there are also non-demographically representative previously disadvantaged owned companies (Bartsch, Coetzee, Smith & De Klerk, 2020).

It is the next tier of companies that is of greatest concern – small companies.

Small companies operating in Namibia, account for a significant portion of paid employment. They stand to be negatively affected by not complying with the future regulations or not being able to afford the cost of compliance.

NEEEB will add significant costs to all businesses, especially small enterprises, which are probably marginal given their size alone.

Even those with diplomas, degrees and postgraduate education struggle to find work in the country, with 23.8% of these Namibians being unemployed in 2018 (compared to 7.8% in 2014). Unemployment among postgraduates went up from 0.9% in 2014 to 9.5% in 2018.

Namibia does not have a shortage of possible employees – official unemployment was at 33.4% in 2018, with the youth (ages 15-24) facing unemployment of 60%. Most unemployed persons, including the youth, would meet the criteria for 'previously disadvantaged Namibians' or 'empowerment beneficiary', as per the wording in NEEEB.

* Remainder of series to follow.



References:

De Klerk, E. (2020). Unpublished Masters thesis: for the degree of Master of Philosophy, Futures Studies.

Qua Vadis Namibia?

The development of scenarios to provide more insight into where Namibia may find itself by 2040. University of Stellenbosch.

Namibia Statistics Agency. The Namibia Labour Force Survey 2014, 2016, 2018

Schade, K., & Amunkete, T. (2011). Namibia labour force survey 2008 - An attempt to unravel the mystery of statistics. Special Briefing Paper No. 2. Windhoek: Institute for Public Policy Research.

Bartsch, A., Coetzee, J.J., Smith, J. & De Klerk, E. (2020). Economic Policy Research Association: Analysis of the Latest Version of the New Equitable Economic Empowerment Bill.



jcoetzee@nust.na