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SMEs lead job creation, with a 71% share of workforce – GSS report

Oct. 2, 2017, 9:35 a.m.

Despite the inadequate support given to small and micro-sized establishments, they remain the leading employers - absorbing as much as 71.4 percent of the country’s total workforce, according to the latest edition of the Integrated Business Establishment Survey (IBES II) by the Ghana Statistical Service (GSS).

The IBES II, which sampled 3,102, 917 persons from 31,152 establishments out of a national total of 638, 480 from the Business Register of all non-household establishments, indicates that large-sized establishments employ only 16.6 percent.

The survey, carried out between November 2015 and May 2017, shows that majority of the workforce are in the services, particularly the wholesale and retail trade sub-sector, which the report says explains the low manufacturing base of the economy.

In terms of revenue generation by location, the report indicates that the Greater Accra Region alone accounts for 70 percent of all revenues generated.

A comparative analysis of the IBES II and the 2003 Industrial Census also indicates that over the last decade the total number of establishments in the industry sector more than quadrupled, with the manufacturing sub-sector being the main driver.

Speaking at the launch of the report, acting Government Statistician, Baah Wadieh, said although the GSS has over the years produced numerous studies, they are barely used to enhance policymaking.

“The Ghana Statistical Service has over the years produced policy-relevant reports which, if used exhaustively, will enhance evidence-based decision-making. This latest report is another classic example of a policy-relevant document.

“It is worth noting, however, that statistical enquiries/surveys are a very expensive exercise, and the only way to justify the huge investment of resources is for the surveys to be used exhaustively by all stakeholders,” he observed.

Commenting on the findings, Deputy Director, Policy and Research, of the Association of Ghana Industries, John Defor, said it is a demonstration of the uneven distribution of economic activities in the country and the need for government to take steps to even-out businesses in all 10 regions.

“We have a very unfair distribution of economic centres, because for Greater Accra alone to churn out that figure, it is bad.”

He said government should take steps to reduce the cost of electricity, especially in the other regions, as a way of incentivising investments into those areas, adding: “I think it is important that we have a fair distribution of our infrastructure.

“One of the key elements that we could use to motivate economic activity is electricity. Anywhere there is electricity, it triggers economic activities. So, we need to ask ourselves: do we have reliable power supply in the other areas, and is it competitive?

“In our urban development and planning, we also need to see how best we can spread economic opportunities throughout the country,” he noted.

Among other things, the report called for a shift from subsistence agriculture to more mechanised farming; good education and quality infrastructure throughout the country; creation of more industries in all regions; as well as creation of free-zone enclaves in all regions over the short-term and in the districts over the long-term