Economists slam NSA for changing unemployment definition, claiming Namibia’s jobless rate is above 50%

Economists are slamming the Namibia Statistics Agency (NSA) for changing the definition of ‘unemployed’, saying the agency is misleading the country.

The agency yesterday announced that Namibia’s overall unemployment rate is 37%, with youth unemployment standing at 45%.

NSA statistician general and chief executive Alex Shimuafeni announced this during the release of the 2023 Labour Force Survey report in Windhoek.

Namibia’s workforce dropped from 725 742 in 2018 to 546 805 in 2023, the NSA said, and retrenchment statistics show that 24 334 employees lost their jobs during this period.

While 1.87 million Namibians are of working age, the employed population was estimated at 546 805 people, the agency said.

Shimuafeni yesterday explained the agency’s definition of the unemployed.

“The unemployed people are 320 442, which is 36.9%. So that is the official unemployment rate of Namibia,” he said.

He said the definition excludes people doing unpaid work, such as subsistence farmers and fishermen, volunteers at organisations and unpaid trainees.

Analysts say the country’s ‘real’ unemployment rate could be more than 50%.

Cirrus Capital data and analytics head Tannan Groenewald yesterday disputed that the unemployment rate for 2023 was 37% – up from 33.4% in 2018.

The NSA’s definition of unemployment does not include discouraged jobseekers, or those who have given up on finding a job either, he said.

“The true unemployment rate using the broad definition historically used stands at 54.8% – one of the highest in the world,” he said.

Groenewald said the exclusion of discouraged jobseekers goes against the standards for African and other developing nations, which include discouraged jobseekers.

“As particularly in Namibia’s case, where nearly 75% of unemployed jobseekers have failed to find any sort of employment for more than a year in 2018. Today, the NSA has excluded this data, signalling a worsening situation,” he said.

Only about 550 000 Namibians are employed, a sharp decline from the 730 000 in 2018, he said.

‘61% OF YOUTH JOBLESS’

“Meanwhile, youth unemployment stands at 61.4% using the broad definition. By sectors, most have seen huge decreases in the number of employed Namibians,” he said.

Narrowing in on the sectors, Groenewald said employment in the agriculture sector is now half of what it was in 2018.

“Tourism employment has contracted by 65%, and private households as employers (that being domestic workers and those making and selling their own goods, etc.) is down 40%,” he said.

Economist Omu Kakujaha-Matundu yesterday told Desert FM the NSA uses a narrow definition of unemployment.

“If you take the broad definition, youth unemployment could be as high as 70% and for the national one 50%, with so many people not captured in the narrow definition,” he said.

Kakujaha-Matundu said without understanding these statistics, Namibians would not know the reality on the ground.

“You see all these beautiful young people standing at traffic lights and the like, having nothing to eat since morning until evening when they run back home, just galloping back home to sleep on an empty stomach.

“That is basically the repercussions of having such a high unemployment rate,” he said.

Kakujaha-Matundu said if the government wants to lower the country’s crime rate, “what you’re going to do is build more of what you really wish for for your country”.

“This calls for the government to wake up and do something about this,” he said.

IJG corporate adviser Lucas Martin yesterday on LinkedIn said the labour statistics for 2018 and those for 2023 were defined and calculated differently.

“It’s wild misrepresentation, and we can’t even place these two numbers on the same chart,” he said.

Martin said according to the NSA’s 2018 definition, unemployment increased from 33.4% to 54.8%.

“By 2023’s strict definition, unemployment increased from 19.8% to 36.9%,” he said.

Martin said the majority of the population is not aware of this difference, “and will take your information as true, showing a more moderate decline from 33.4% to 36.9%”.

“It’s incredibly sad to see one of our most key institutions disintegrating into deceiving the population it serves,” he said.

The corporate adviser said this raises questions on why a labour force survey was delayed for so long.

“How can we be serious about improving our society by flying blind?” he asked.

‘EDUCATION NOT KEY’

Twilight Capital Consulting independent economist Mally Likukela yesterday said of increasing concern is the high rate of unemployment among graduates.

“This suggests that the higher you go, the less employment opportunities you get,” he said.

Likukela said this suggests there is a disconnect between the education system and the labour market.

“Education is no longer the key,” he said.

He said the 37% unemployment rate confirms that this is indeed a structural issue, meaning that not many jobs were created despite the growth in the economy.

“This shows a serious structural fault creating a total disconnection between gross domestic product and jobs,” he said.

Likukela said this disconnection demonstrates that economic policies used to grow the economy are “blind” regarding labour.

“Policies are devoid of employment creation ingredients, thus leading to growth without jobs,” he said.

Lawmaker Inna Hengari wants the country’s leadership to put politics aside to deal with unemployment.

“We know what causes unemployment in this country: The biggest contributor is our education system. We need to decide to unite beyond political party affiliation,” she says.

She says the discord between the education curriculum and the needs of the labour market should be put under the microscope.

“If your education policy, for example, in the country does not work to ensure that the graduates that we produce from institutions of higher learning are graduates who are employable, you are going to have a youth unemployment crisis,” she says.

Hengari introduced a motion in parliament on the youth unemployment situation and how to deal with it in 2021.

She says members of parliament have been on oversight and benchmarking visits, but the parliament is yet to see reports on this.

“As soon as parliament opens, I intend to raise this issue quite vocally,” she says.

United Nations resident coordinator for Namibia Hopolang Phororo says the government’s primary focus should be on the young people of Namibia.

“For me, that’s what really stuck out – these young people, what is their plight,” she says.

Phororo suggests that further analysis is desperately needed to fully understand the situation.

“They’ve got degrees, but they can’t find a job, so they’re just withdrawing from the labour market,” she says.

Phororo says more research on formal versus informal employment is needed.

MORE STATS

Furthermore, the NSA’s statistics show that the Kavango West and Kavango East regions top the list of having the highest unemployment rate, with 52.8% and 52%, respectively.

The Kavango West region has recorded the highest increase in unemployment from 33% to 52.8 %, followed by the Omusati and Ohangwena regions.

Moreover, the agriculture, forestry and fishing sector continues to be the top employer, with 88 277 workers, while wholesale and retail trade, as well as motor repairs, employ the second-highest number of people at 54 618.