Retrenchments up 400%
Jo-Maré Duddy – More than 12 000 workers lost their jobs last year as the on-going recession and impact of Covid-19 forced nearly 1 000 employers to cut back or close down.
According to quarterly reports released by the ministry of labour, industrial relations and employment creation, 9 884 or 427% more workers were retrenched in 2020 than the previous year. A total of 12 201 people were retrenched last year.
The ministry’s reports show the second quarter from April to June, which included the national lockdown, saw the most severe haemorrhage of jobs.
In total, 388 employers retrenched 5 748 workers – an increase of more than a 1 000% compared to the same quarter in 2019 when only 485 workers were retrenched by 68 employers.
The impact of the pandemic, however, wasn’t the main culprit, the stats show.
Only 32% of retrenchments or 1 816 job losses were due to Covid-related reasons, the ministry’s executive director, Bro-Matthew Shinguadja, said in his report. The remaining 3 932 were “due to other reasons”, he said, describing the total number of retrenchments as “massive”.
Only about 23% of total retrenchments last year were Covid-related, the ministry said.
The ministry’s data show businesses’ uphill battle already started intensifying in the last quarter of 2019 when retrenchments jumped to 853 from 465 and 485 in the previous two quarters. “The economic turndown still hunts the country, as many people find themselves retrenched by their employers,” Shinguadja commented in the report.
The first three months of 2020 saw 1 946 retrenchments by 144 employers, the biggest number in a single quarter in the past five years.
“The world has been economically challenged by the emerging of Covid-19, which has directly affected the economies. Therefore, a lot is anticipated in labour and employment sector, unless the situation is contained rapidly,” Shinguadja said at the time.
From July to the end of September, 320 employers retrenched 3 484 workers in total, spiking by nearly 650% compared to the third quarter of 2019. According to Shinguadja: “The impact of Covid-19 on employment in the country is evident enough and the retrenchment still haunts the workforce due to Covid-19 and other contributing factors.”
The last three months of 2020 saw the lowest number of retrenchments with 146 employers cutting back on 1 023 workers in total. Compared to the fourth quarter of 2019, jobs were reduced by nearly 20%.
Registration on government’s database for jobseekers shows the ongoing battle of the unemployed.
In 2019, a total of 10 139 jobseekers were registered on the Namibia Integrated Employment Information System (NIEIS) of the ministry. Last year, registrations totalled 9 339.
The Employment Services Act of 2011 requires all employers in Namibia with 25 or more employees to report vacancies or new positions to the Employment Service Bureau (ESB) at the ministry, which then distributes the information.
Last year, 3 215 vacancies were reported. The ministry, however, could only place 9.2% or 297 registered jobseekers.
In 2019, 1 808 vacancies were reported to the ESB, of which 523 jobseekers or 29% were placed.
Analysts agree that around 40% of Namibia’s workforce currently is unemployed following years of negative or poor economic growth, exacerbated by the impact of the Covid-19 pandemic.
“We could easily see the number of unemployed in the region of 430 000 people, given the unemployment rate was around 33.4% in 2018, the [subsequent] increase in unemployment and the increase in the working-age population,” IJG Securities told Business7.
This is nearly 70 000 more than in 2018 when the Namibia Statistics Agency (NSA) conducted its last labour force survey. The average household in Namibia has four people, implying that about 1.7 million people could be affected by an unemployment rate of 40%.
A survey conducted last year by the Economic Policy Research Association (EPRA) found that 63% of businesses believe unemployment will increase substantially over the next five years.
According to the United Unemployed Educators Movement (UUEM), backed by the Teachers Union of Namibia (TUN), 400 applicants are invited for interviews for a single teaching post.
The group last month handed over a petition to the Office of the Prime Minister (OPM) bemoaning its predicament, Nampa reported.
New Era this week reported that 400 applicants attended preliminary interviews for a cleaner position at Omuthiya in the Oshikoto region.