Island’s jobless rate of grave concern
by Walter Blackman
Based on official demographic numbers put out by the Ministry of Finance and Economic Affairs recently, I have calculated that there were 214,100 Barbadians available for work in 2013. Out of that number, only 126,300 people were actually employed.
This means that 87,800 Barbadians of working age did not have jobs in 2013. When translated into a concept that measures the wastage of our human resource, this also means that the Human Unemployment Rate (HUR) for Barbados was 41 per cent in 2013.
All Barbadians, on one hand, should justifiably feel a sense of pride in the fact that Barbados has attracted immense global respect for its high ranking based upon the United Nations’ Human Development Index. On the other, however, a Human Unemployment Rate of 41 per cent demonstrates to the world that whilst our Governments have provided, and are continuously striving to provide, critical developmental services for our citizens (education, health care, security, and so on), only about 59 per cent of our workforce is being utilized.
Put differently, we are investing millions of dollars in raising and educating our people, but no successful policies are being implemented to enable them to work and make a meaningful contribution to the economic development of their country.
Out of the 3,500 students who finished school in 2013, very few have succeeded in getting jobs. How many school leavers will get jobs in 2014? Fewer still. To give you an idea of how serious our unemployment situation is, imagine that for the past 25 years not one student leaving school in Barbados has been able to find a job.
Given the destructive, wasteful, and corrupt practices which have seeped into the area of public finance in Barbados over the past 35 years, a Human Unemployment Rate of 41 per cent at this time is almost fatal economic news for our country. The cumulative effect of these practices are now forcing us to stare some serious questions in the face: can the Government of Barbados adequately service a debt burden of $10 billion, repay its $2 billion obligation to the NIS fund, meet its mounting, unfunded Civil Service pension obligations, and pay for salaries and services with only 59 per cent of a small workforce being employed?
Can we, as a country, earn enough foreign exchange to support our two to one peg to the US dollar with a whopping 41 per cent of our workforce remaining idle? Can we achieve these national objectives in the presence of widening fiscal deficits, paltry global exports, and limited borrowing options triggered by Government’s inability to pay its debts?
If the answer to all of these questions is a resounding “No”, then, given our current human unemployment rate, there is no feasible solution to our public finance and national economic problems. Looking at our situation from a black hole perspective, we are now heading towards the event horizon. A downward spiral has started in earnest, and in many cases, an already bad situation is going to get worse. Let me give you an idea of what I mean.
The fiscal problems confronting the Government of Barbados cry out for a solution that involves job creation and attendant expanding Government revenues. At the same time, unfortunately, diminishing exports, excessive borrowing, poor planning, and low international credit ratings have combined to create a foreign exchange crisis for Barbados. The foreign exchange crisis, in turn, has become the most urgent and overpowering force in the local economy, and it has brought in the IMF, the ultimate lender of last resort, to make financial and economic decisions for us that our leaders were not capable of making.
In an attempt to inject some measure of fiscal responsibility into the management of our country’s public finances, and by extension, to safeguard the interests of our foreign creditors, the IMF has effectively initiated a series of layoffs in Barbados. These layoffs, along with other financial problems confronting the Government, have depressed aggregate economic demand, and have directly triggered layoffs in the private sector as well. The Human Unemployment Rate which stood at 41 per cent in 2013 is therefore rising appreciably in 2014. An already bad situation has worsened, and there is no relief in sight.
Given the fact that we have 88,700 able-bodied Barbadians who are not working, what policies and ideas are being highlighted and pursued by the Government with the aim of solving the problem?
A few weeks ago, we were treated to a somewhat instinctive proposition which came from Minister of Education Ronald Jones. Ostensibly inferring that the Government does not like the idea of cutting its expenditure, the minister argued that Barbados needed more economic activity which would enable the Government to collect more taxes to cover its expenditure.
Fair enough, up to that point. However, where the minister started to raise the cynical eyebrows of his detractors is when he recommended, as a solution to the problem, the production of many more babies than are being born currently in Barbados.
The minister’s recommendation of an increase in baby production in Barbados (whether by fornication, adultery, hook or crook, or traditional marriage) as a solution to our current economic problems must have sparked some interesting conversation and responses in the offices, rum shops and living rooms across Barbados.
On the religious front, the church has always held the position that sex and procreation should be reserved for married couples only. Yet so far, the voices within the church, the traditional bulwark of our societal morality, have remained relatively silent in the face of a deafening cry from a minister of the Crown for engagement in indiscriminate, wanton, baby-producing sex.
On the family planning front, we have been advised for the past 40 years, that it is of extremely critical importance for Barbados, a small island state with scarce limited resources and with one of the highest population densities in the world, to keep a firm lid on the growth of its population. The minister’s solution represents a shot across the bow of the Barbados Family Planning Association’s efforts, which are aimed at keeping our population from exploding.
In Barbados, health practitioners and AIDS counsellors have been highlighting the risks associated with unprotected sex, given the presence of the AIDS virus in many fertile Barbadians. The minister’s call for an upsurge in unprotected sex, to produce more babies, amounts to an invitation for Barbadians to increase the incidence of AIDS in their country.
On the human unemployment front, therefore, it is fair to conclude that the Minister of Education has more faith in the strategy of waiting for babies to grow up and revive the national economy than in coming up with policies to generate jobs for the 88,700 Barbadians who are currently waiting to be employed. We can only hope that the other members of the Cabinet hold a different philosophical position on this matter.
For the unemployed in Barbados today, the future looks rather uncertain and bleak. At the individual level, some of our jobless are hearing daily about the need to become entrepreneurs, but they have little or no experience, no guidance from a successful model in place, no business skills or training, and no finance to transform themselves from being “dreamers” into successful entrepreneurs.
Others are trying a “thing” in the underground economy. Others are sending out hundreds of job applications and are hoping against hope that a few big projects would open up and create some jobs, even if temporarily. After many years of trying, others have given up and have decided to rely on someone else for support.
The future of the entire country depends on our ability to put these 88,700 people to work. Somehow, we have to wrap our collective minds around the central objective of coming up with ideas that can generate jobs for our fellow Barbadians and that rely on no financial contribution or commitment from Government.
Can we do it?
(Walter Blackman is a pension actuary, licensed by the Federal Government of the United States.)