COVID-19 has rendered 500,000 people jobless in Ghana – TUC

The devastating impact of COVID-19 is profoundly being felt in the pockets of Ghanaians with as many as 500,000  jobs lost.

The Trades Union Congress (TUC) estimates as many as 100,000 lost jobs in the formal sector and 400,000 being wiped off in the informal sector after an evaluation of the market.

COVID-19 has killed these sources of income in less than six months since Ghana recorded its first case on March 12 with mass redundancies.

“We estimate about half a million people who have lost their jobs and livelihoods,” Dr Kwabena Nyarko Otoo, the TUC Chief Economist and Director of the Labour Research and Policy Institute, told theghanareport.com in an exclusive interview.

Consequently, he has urged the Minister of Finance, Ken Ofori-Atta, to introduce comprehensive aid for the affected people as well as businesses reeling the effect of the virus.

Mr Ofori-Atta is scheduled to present the Mid-Year Budget Review on Thursday, July 23.

The contagion has hit all sectors including health, education, tourism, agriculture, entertainment, hospitality and major services.

President Nana Akufo-Addo on March 30 ordered a lockdown of parts of Accra, Tema, Kasoa and Kumasi ostensibly to shield the public from the spread of the virulent disease. The lockdown was lifted on April 20.

Companies either shut down or ran at half strength as they enforced social distancing protocols

That in addition to several other restrictions took a toll on businesses as production and consumption slumped

Dr Otoo pointed out that even self-employed people have had their revenue streams disrupted because of restrictions, lockdowns and other anti-coronavirus protocols.

“Many of the private schools are no longer paying the teachers,” he bemoaned, adding “many hotels are shut”.

“We expect the government to announce measures that will forestall further job losses” in the upcoming budget, he stressed.

The TUC wants interventions that would support businesses, especially firms that have managed to maintain their workers.

Workers who may have lost their jobs could be given income support as well as skills upgrades and personal development.

Friedrich- Ebert- Stiftung estimates 88% of Ghana’s workforce serving in the informal sector without access to basic protections and services of the state.

The TUC is encouraging preparation for adversities “so that in future, when we have a pandemic of this nature, we will be able to identify people, especially in the informal sector, to extend the assistance we want to offer them”.

To cushion the Ghanaians against effects of the pandemic, the government subsidised electricity, water and other services. A GHC 600 million stimulus was also promised to small and medium scale businesses.

Although the move is laudable, the TUC finds it inadequate.

“It is not enough if you look at the scale of losses that COVID-19 has impacted,” Dr Otoo lamented.

In his view, the GHC 600m can be given to people in the informal sector, but bigger firms which employ 100 people and above need a bigger stimulus to maintain their workforce.

Mr Ofori-Atta has hinted that aid for large-scale firms and the modalities are expected to be captured in the budget.

The TUC is pushing for more investment locally to boost the country’s economy and ensure self-sufficiency during crises.

“We need to build internal resilience because, in a pandemic like this where borders are closed, we have to look within to survive,” he noted.

The TUC wants trade policy and other measures to cushion indigenous firms to compete with foreign companies in Ghana.

Additionally, he called for job insurance via unemployment schemes to protect businesses and workers when jobs become endangered.

“We have to prepare the economy for future pandemics of this nature…this one took us off guard”.

In April, the International Labour Organization (ILO) warned that the continued sharp decline in working hours globally due to the COVID-19 outbreak means that 1.6 billion workers in the informal economy – that is nearly half of the global workforce – stand in immediate danger of having their livelihoods destroyed.

The first month of the crisis is estimated to have resulted in a drop of 60% in the income of informal workers globally. This translates into a drop of 81% in Africa and the Americas, 21.6% in Asia and the Pacific, and 70%  in Europe and Central Asia.

“For millions of workers, no income means no food, no security and no future. “As the pandemic and the jobs crisis evolve, the need to protect the most vulnerable becomes even more urgent,” Guy Ryder, ILO Director-General noted.

COVID-19 job losses in Africa

A study by the African Union (AU) recently estimated up to 20 million jobs at risk due to the coronavirus.

The African Development Bank had projected GDP growth of 3.4% before the outbreak, but AU economists are now predicting a 0.8% drop.

COVID-19 jobless across the world

Elsewhere, The Guardian reported in May that the number of workers who lost their jobs in the US soared to more than 40 million as the number of unemployment claims continued to rise, with 2.1 million people filing for unemployment.

This was mainly attributed to widespread shutdowns and stay-at-home orders in an effort to halt the spread of the deadly pandemic.

The Department of Labor estimated more than 20 million Americans losing their jobs in April, bringing the unemployment rate to 14.7%, up from 4.4% in March.

In Europe, about 397,000 lost their jobs in April alone, according to data from the EU’s stats agency, released in June.

Euronews reported that the EU’s jobless rate rose to 6.6% in April, from a 12-year low of 6.4% the previous month, according to Eurostat.

Most governments resorted to furlough schemes to mitigate the impact of the coronavirus.

The furlough system puts workers on temporary leave and the government pays a percentage of their salaries.

In the UK, for example, British Petroleum announced 10,000 job cuts on June 8. Swissport announced that 4,556 jobs could be affected, while British Air raised fears about the inability to keep up to 12,000 employees. EasyJet cut 4, 500 while Virgin Atlantic downsized by 3,000.

The latest was Ryanair, which reduced workers by 15% representing 3,000 jobs. Jet engine-maker Rolls-Royce also cut 9,000 jobs.
In France, car manufacturing company Renault laid off 15, 000 like Airbus which axed 15,000 workers as well with Air France sending announcing that it would send 7,500 workers home by 2022.

In Germany, airline company Lufthansa laid off 22, 000 while Anglo-German travel firm Tui send home 8,000 people. For industrial conglomerate Thyssenkrupp, it was 3,000 workers while German aircraft engine manufacturer MTU Aero Engines was up to 1,500 jobs.

 

 

1 Comment
  1. Anonymous says

    What of those unemployed before the outbreak?
    Graduates, school leavers at various points and more so dropouts.

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