Companies’ demand for labor services started the year on a sluggish note, suggesting that businesses are still struggling to whether the storms of the pandemic and the recent economic challenges which have been intensified by the Russia-Ukraine crisis.
According to data from the Bank of Ghana, the number of jobs advertised in selected print and online media, which gauges labour demand in the economy, declined by 8.4 percent year-on-year in the second month of 2022 compared to the corresponding month last year.
Bank of Ghana disclosed that a total of 2,746 job adverts were recorded in February 2022 as compared to 2,999 recorded in February 2021. This means that in the course of the past one year, advertised jobs in the media were down by 253, which in percentage terms, was an 8.4 percent decline.
Despite the fall in labor demand on a year-on-year basis, the data show that marginal gains were made when compared to what happened in the first month of this year. The number of job vacancies in February 2022 increased by 4.6 percent, on a month-on-month basis, over what was recorded in January 2022, according to the Bank of Ghana.
The marginal improvement on a month-on-month basis in February was still not enough to offset a fall in labor demand in the first two months of the year. “Cumulatively, the number of jobs advertised in the first two months of 2022 decreased by 4.4 percent to 5,370 from 5,618 recorded in the corresponding period of 2021”, the Bank of Ghana stated in its March 2022 edition of the Monetary Policy Report.
The year-on-year decline in the number of jobs advertised, according to the Bank of Ghana, reflected some of the difficulties faced by businesses as a result of the coronavirus pandemic.
Improvement in employment conditions
Amid the decline in labor demand, came an improvement in the general employment conditions in January 2022. The Bank of Ghana disclosed that the total number of private sector SSNIT contributors, which partially gauges employment conditions, improved to 828,061 in January 2022 compared with 808,301 for the same period in 2021. In percentage terms, this means that employment conditions in the Ghanaian labor market improved by 2.4% year-on-year in the first month of the year.
However, on a month-on-month basis, total number of private sector SSNIT contributors decreased by 4.1 percent from the 863,094 individuals recorded in December 2021.
The Bank of Ghana stated that it expects real sector activity to continue to recover, although still below potential. “In the outlook, activity is expected to improve in the medium-term on the back of positive real sector expectations and rising foreign demand. However, tighter monetary conditions and the on-going fiscal consolidation are likely to moderate the pace of the recovery in the forecast horizon”, BoG stated in its real sector outlook.
The Bank of Ghana indicated that it expects growth momentum to moderate in the first half of 2022 due to the rising input costs triggered by the upward adjustments in petroleum prices. Also, the latest Bank of Ghana surveys results indicated relaxed consumer and business confidence, which may affect private sector production plans and investments. This notwithstanding, the gradual rebound in private sector credit will continue to drive the growth process in the near term, the Bank of Ghana assured.
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