Ghana Faces Tough Choices on Jobs as World Bank Urges Policy Shift

Ghana’s struggle with high unemployment and underemployment demands urgent, targeted policy action, according to a stark assessment from the World Bank.

The institution warns that without decisive interventions in three critical areas, efforts to create sustainable jobs and attract vital private investment will fall short, stifling long-term economic progress.

The findings come from the Bank’s latest Ghana Economic Update, which spotlights the nation’s persistent labour market challenges.

Relying solely on public spending or temporary fixes won’t generate the millions of decent jobs Ghana needs, especially with thousands of young people entering the workforce yearly. The report argues success hinges on focused strategies that tackle specific bottlenecks.

First, the Bank emphasizes the non-negotiable link between job creation and robust infrastructure coupled with a skilled workforce. Poor roads, erratic power, and inadequate irrigation drive up business costs and cripple competitiveness.

Rather than the government bearing this burden alone, the report advocates leveraging Public-Private Partnerships to draw in private investment. Equally crucial is revamping education, particularly technical and digital training, to ensure graduates possess skills employers actually seek. Without this, Ghana risks churning out unemployable youth.

Secondly, even where infrastructure exists, Ghana’s private sector, dominated by small informal firms, struggles to grow. Structural hurdles like complex land ownership, slow bankruptcy procedures, and scarce financing stifle innovation and expansion.

Stabilizing the policy and regulatory environment is vital to rebuild investor trust, the Bank states. Concrete steps like digitizing land records, modernizing insolvency laws, and ensuring predictable policy direction could significantly level the playing field for the job-creating SMEs and entrepreneurs Ghana depends on.

Finally, unlocking large-scale private capital is paramount. Government budgets simply cannot finance the necessary job-creating investments alone. Ghana must broaden access to finance, actively encourage entrepreneurship, and deploy innovative tools like political risk insurance and guarantees.

This is especially important for attracting investment to underserved regions like the north. Long-term stability, reducing both political and country risk perceptions, is critical. Investors crave certainty, the report notes; reforms lowering these risks could unleash new investments in manufacturing, agribusiness, and services.

The bottom line is clear: generating sustainable jobs requires deliberate, multi-faceted policy choices. For the Mahama administration, prioritizing these areas isn’t optional.

The livelihoods of thousands entering Ghana’s job market each year depend on getting this right. Can the government create the certainty and conditions needed to unlock the private investment that fuels lasting employment?

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