[vc_row full_width=”stretch_row” pix_particles_check=”” css=”.vc_custom_1648218350020{padding-top: 80px !important;padding-bottom: 80px !important;background-color: #ffffff !important;}”][vc_column][vc_column_text]Source: AFDB Ghana
The economy of Ghana achieved consistent and strong growth in the years leading up to the pandemic, resulting in improved business competitiveness and poverty reduction. From 2017 to 2019, the country’s gross domestic product (GDP) grew strongly (2017: 8.1%; 2018: 6.2%; 2019: 6.5%))[1], [2],[3]. Furthermore, the country’s inflation rate decreased from 15.4% in December 2016 to 7.6% in September 2019, marking the lowest rate seen in the country in the past 27 years[4]. The poverty rate, as measured relative to the national poverty line of Ghana, has decreased by more than half in recent decades, from 52.7% in 1991 to 23.4% in 2016, mostly driven by growth in average household consumption[5]. Inequality, however, as measured by the GINI index, has been rising.[6]
Due to the COVID–19 pandemic and falling oil prices, economic growth in Ghana has slowed significantly, pushing the country into recession for the first time in 38 years.[7][8] The country’s GDP growth dropped from 6.5% in 2019 to 1.1% in 2020.[9] Yet despite some pessimistic post-pandemic economic forecasts[10], Ghana’s annual growth in 2021 is projected to be 4.6%, indicating that the country’s economy is recovering. [11]
The services sector in Ghana is becoming increasingly important for the country’s economy. In 2019, the highest contributing sector to Ghana’s GDP was the services sector (44.14%), followed by industry (31.99%) and agriculture (17.31%).[12] Furthermore, since 2010, there has been a significant labour-force shift from the agriculture sector to the services sector. Distribution of employment in Ghana by economic sector in 2020 shows that 49.36% of employees in Ghana now work in the services sector, 28.46% in the agriculture sector, and 22.19% in the industry sector (see also Figure 3).[13][/vc_column_text][pix_img align=”text-center” img_div=”text-center” style=”” hover_effect=”” add_hover_effect=”” css=”.vc_custom_1656952002469{margin-top: 20px !important;margin-bottom: 20px !important;}” image=”14921″][vc_column_text]Figure 4: Employment by economic sectors (2010-2020)
There are gender-related and regional sectoral employment differences in Ghana. The GLSS 7 report indicated that men (41.7%) were more likely than women (35.1%) to be employed in the agricultural sector, while women (43.8%) were more likely than men (32.2%) to be employed in the services sector. Most employees in the services sector are urban dwellers (64.7%), while just 21.9% of their rural counterparts work in the sector. The agricultural sector, by contrast, mainly employs rural dwellers (65.2%) against just 11.8 percent of urban dwellers.[14]
Educational attainment of people aged 15 years and above varies between urban and rural areas and between sexes. The GLSS 7 report indicates that the share of the urban population that has attended school is generally high in most regions for both men (93.8%) and women (81.3%). Although variations exist in rural areas, educational attainment is lower for men (81.3%) and considerably lower for women (65.5%).[15] According to the GLSS 7 report, unemployment is highest among those with A or O level qualifications or holders of the West African Senior School Certificate Examination (WASSCE) at 15.9%.[16] This is followed by people with a certificate, diploma, or Higher National Diploma (HND) at 9.5%. The unemployment rate is lowest for people with tertiary education (eg a bachelor’s or master’s degree) (8.3%).[17]
With Ghana’s youth constituting 34.2% of the total population, the country’s population is comparatively young.[18] This makes youth a valuable asset for economic growth and social development if engaged effectively and efficiently.[19] [20] Youth in Ghana, however, are particularly affected by unemployment.[21] The International Labour Organisation (ILO) reports that, despite a drop from 2015 (14.17%) to 2017 (8.84%), Ghana’s youth unemployment rate has been increasing steadily in more recent years – from 8.79% in 2018 to 9.46% in 2020, as depicted in Figure 4 below.[22] Underemployment has also been prevalent in Ghana, particularly in the informal economy.[23] The GLSS 7 report estimates that 21.4% of Ghana’s working population is underemployed, meaning they work fewer hours than their capacity would allow. Underemployment affects rural areas slightly more than urban areas (59.3% vs 40.7%). Furthermore, youth constitute nearly half of the underemployed workers in Ghana (49.2%). [24][/vc_column_text][pix_img align=”text-center” img_div=”text-center” style=”” hover_effect=”” add_hover_effect=”” css=”.vc_custom_1656952054302{margin-top: 20px !important;margin-bottom: 20px !important;}” image=”14922″][vc_column_text][1] World Bank Data. 2020. “GDP growth (annual%) – Ghana”. Accessed May 12, 2021. https://data.worldbank.org/indicator/NY.GDP.MKTP.KD.ZG?end=2020&locations=GH&start=2012
[2] African Development Bank. 2021. “Ghana Economic Outlook”. Accessed May 13, 2021. https://www.afdb.org/en/countries/west-africa/ghana/ghana-economic-outlook
[3] World Bank. 2021. “The World Bank in Ghana”. Accessed May 13, 2021. https://www.worldbank.org/en/country/ghana/overview.
[4] Ministry of Finance Ghana. 2019. The Budget Statement and Economic Policy of the Government of Ghana for the 2020 Financial Year.
[5] World Bank. 2020. Ghana Poverty Assessment. © World Bank.
[6]Cooke, Edgar, Sarah Hague, and Andy McKay. 2016. The Ghana poverty and inequality report: Using the 6th Ghana living standards survey. University of Sussex: 1-43.
[7] World Bank. 2021. “The World Bank in Ghana”. Accessed May 13, 2021. https://www.worldbank.org/en/country/ghana/overview.
[8] African Development Bank. 2021. African Economic Outlook 2021. From Debt Resolution to Growth: The Road Ahead for Africa.
[9] World Bank. 2021. “The World Bank in Ghana”. Accessed May 13, 2021. https://www.worldbank.org/en/country/ghana/overview.
[10] World Bank. n.d. “World Development Indicators Ghana”. Accessed May 13, 2021. https://data.worldbank.org/country/ghana?view=chart.
[11] African Development Bank. 2021. African Economic Outlook 2021. From Debt Resolution to Growth: The Road Ahead for Africa.
[12] World Bank. 2021. “The World Bank in Ghana”. Accessed May 13, 2021. https://www.worldbank.org/en/country/ghana/overview
[13] Statista. 2020. “Ghana: Distribution of employment by economic sector from 2010 to 2020”. Accessed May April 28, 2021. https://www.statista.com/statistics/447530/employment-by-economic-sector-in-ghana/
[14] Ghana Statistical Service. 2019. Ghana Living Standards Survey (GLSS 7): Main Report.
[15] Ghana Statistical Service. 2019. Ghana Living Standards Survey (GLSS 7): Main Report.
[16] Ghana Statistical Service. 2019. Ghana Living Standards Survey (GLSS 7): Main Report.
[17] Ghana Statistical Service. 2019. Ghana Living Standards Survey (GLSS 7): Main Report.
[18] Ghana Statistical Service. 2019. Ghana Living Standards Survey (GLSS 7): Main Report., share of youth in total population
[19] Boateng, Gilbert O., Akwasi A. Boateng, and Harry S. Bampoe. 2014. Barriers to youthful entrepreneurship in rural areas of Ghana. Global journal of business research 8.3: 109-119.
[20] Honorati, Maddalena, and Sara Johansson De Silva. 2016. Harnessing youth potential in Ghana: a policy note. No. 106877. The World Bank.
[21] Adeniran, Adedeji, Joseph Ishaku, and Adekunle Yusuf. 2020. Youth employment and labor market vulnerability in Ghana: Aggregate trends and determinants. West African Youth Challenges and Opportunity Pathways. Palgrave Macmillan, Cham. 187-211.
[22] Ghana Statistical Service. 2019. Ghana Living Standards Survey (GLSS 7): Main Report.
[23] Osei-Boateng, Clara, and Edward Ampratwum. 2011. The informal sector in Ghana. Accra: Friedrich-Ebert-Stiftung, Ghana Office.
[24] Ghana Statistical Service. 2019. Ghana Living Standards Survey (GLSS 7): Main Report.[/vc_column_text][/vc_column][/vc_row]
