Monday, January 19, 2015

High Bahamian youth unemployment, and resulting poverty and social inequality breed high crime levels in The Bahamas

Poverty Breeds 35% ‘No Graduate’ Rate

Tribune Business Editor

More than one-third of the poorest Bahamians fail to complete secondary education, helping to create what a former Cabinet minister yesterday described as a “stubbornly high” youth unemployment rate that must be reduced urgently .

James Smith, ex-state finance minister, told Tribune Business that the high jobless rate among Bahamians aged between 15-24 years-old, which hit 31 per cent in November 2014, was “structural” in nature.

He said the high rate epitomised the large gap between jobs that were available and the skill sets required by employers, with many young Bahamians not equipped to meet these requirements.

Apart from the “social fallout” caused by high youth unemployment, the former Central Bank governor warned that it also held back economic growth, because unemployed persons lacked the incomes to give them spending power.

The consequences are spelled out in a recent Inter-American Development Bank (IDB) report obtained by Tribune Business, which identified high unemployment among young Bahamians, and resulting poverty and social inequality, as key factors behind the high crime levels.

The IDB report, on a proposed ‘Citizen Security and Justice Programme’, found that 35 per cent of 20-24 year-old Bahamians drawn from the poorest segment of society had failed to complete secondary school, compared to just 6 per cent of the rest of the population in the same age group.

Highlighting the startling inequalities in Bahamian society, the IDB report said: “The fact that most students complete secondary education but only half of them graduate (pass a final examination) is a worrying indicator of poor system performance.

“Available data shows that 35 per cent of 20-24 year olds from the poorest decile have not completed secondary education, compared to 6 per cent of the rest of the population of that age.”

While unemployment in the 15-24 year-old age group was slightly down in November 2014 compared to the 32.3 per cent peak hit in 2013, the IDB report left no doubt as to the consequences for Bahamian society.

“Research and evidence, show that a wide variety of risk factors contribute to the prevalence of youth violence, one of them being lack of attachment to school and the workplace during adolescence and adulthood,” its report said.

“In the Bahamas, youth unemployment has doubled from 14.9 per cent in 2001 to 32.3 per cent in 2013 for job seekers aged 15 to 24)”, a rate double that of the overall nation’s.

“Further analysis within the 15-24 age group shows that unemployment is particularly high among 15-19 year-olds seeking jobs (42 per cent versus 24 per cent for those 20-24),” the IDB added, highlighting the problems secondary school leavers face in finding immediate employment.

“Searching for jobs can be a discouraging process given that more than 50 per cent of youth remain unemployed for more than a year,” the Bank’s report said. “Idle young people (not in employment, education, or training) are particularly vulnerable to continued labour detachment, which may contribute to violent or anti-social behaviour.

“The employability of youth hinges critically on the level of education and skills attained to match demands from employers. Even though most students complete secondary education, only half of them actually graduate.

“Although there are not available measures of skill levels of unemployed youth, most employers report difficulties in recruiting job candidates because of insufficient specific skills (66 per cent), soft skills (24 per cent) and numeracy skills (12 per cent).”

Responding to the Department of Statistics’ Labour Force Survey, Mr Smith described youth unemployment as “stubbornly high” and “an area that really needs to be addressed”.

He identified the cause as “the gap between available jobs and the skill sets to meet those jobs”, and said: “Jobs being advertised are calling for skills a lot of young people don’t have, plus experience, because a lot of them have never worked before.

“The quick solution to that is really to identify and train the people, if they can, to reach the level of aptitude for jobs that is required.”

Besides the social impact, Mr Smith told Tribune Business: “It’s a restraint to economic growth. Young people joining the labour force at a sufficiently large rate, that keeps an economy going.

“I’m optimistic that over time most of these things will work themselves out.”

The Bahamas Chamber of Commerce and Employers Confederation (BCCEC), too, in a statement issued yesterday called for “more emphasis” to be placed on training and skills development in the Bahamian workforce.

“In the excessively fast pace world in which the Bahamas competes, things are moving at the speed of light and if individuals do not take the time to tool and retool themselves, they will get left behind,” the BCCEC said.

“Businesses are looking for people with drive and ambition who are able to produce quality work at an accelerated pace. Loyalty in the workplace experienced in years gone by is a thing of the past, and individuals who are high achievers are always looking for something that is more challenging and more gratifying.

“Therefore, it is also important for private sector businesses and the public service to be on the cutting edge of innovation and technology to ensure that they are also keeping pace with new developments and that they are able to attract quality employees in their businesses.”

The BCCEC added that industrial peace would also aid hiring, and called on employers and trade unions to negotiate reasonable settlements to outstanding issues.

Describing the Bahamian economy as “very fragile”, the Chamber said: “Trade unions, particularly in this environment, should remain cognisant of the vulnerability of workers and should ensure that their members remain employed through balanced demands tied with worker performance and the financial position of employers.

“Employee benefits will come, but the first rule should be that of survival in this current economic environment.”

January 16, 2015

Tribune 242