Saturday, April 20, 2024

Fix the jobless rate


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THE CARIBBEAN HAS a labour market problem that needs fixing. Research from the Caribbean Centre For Money & Finance (CCMF) concluded that the average unemployment rate has been above ten per cent for the past eight years.

CCMF research assistant Bjorn Warde, commenting on the issue in a recent edition of the organisation’s newsletter said “a greater focus on labour market issues and growth is required to transform the labour markets in the Caribbean to make them more robust and flexible”.

“ . . . There is need for greater emphasis by governments on building resilience through economic diversification and other structural reforms to increase the growth potential of these economies,” Warde said.

“Other strategies such as promoting gainsharing/performance based payment schemes to link wage and salary increases to increases in productivity, and updating labour regulations to reflect modern production systems, while enhancing workers’ welfare and bringing efficiency to the industrial relations process are all ways in which Caribbean countries can, and have already started, to address the problem of unemployment.”

Warde said a high level of unemployment “is a problem confronting many Caribbean economies”.

The researcher referred to the International Labour Organisation’s World Employment and Social Outlook – Trends January 2017 report which said unemployment challenges were particularly acute in the Caribbean because the region was still coping with economic problems caused by a relatively difficult international economic environment.

“The expected growth in the number of individuals attaining working age this year will have an important negative impact on the unemployment rate in 2017,” Warde said.

“The growth of the labour force in the Caribbean, with no real growth in employment opportunities, is an important factor contributing to the higher unemployment rates in the Caribbean in recent times.”

The analysis observed that “the commodity-based economies in the Caribbean have generally had lower average rates of unemployment but since 2015/2016 they have reported increases in their levels of unemployment”.

“The global decline in commodity prices has significantly influenced the levels of economic activity in Trinidad and Tobago, Suriname and Guyana and this has resulted in a number of labour market issues in 2016/2017 such as job losses and strike action.”

Services-based economies like Barbados “have experienced higher levels of unemployment over time when compared to the commodity-based economies”. (SC)


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