The Ghana Employers’ Association (GEA) has called for implementation of effective monetary and exchange rate policies to stabilise the cedi’s depreciation, reduce high inflation and bring it down to single-digit levels.
The latest inflation data from Ghana Statistical Service (GSS) show that consumer inflation dropped to 20.4 percent in August 2024, down from 20.9 percent in July – marking the fifth consecutive month of easing inflation.
The association however believes that a much lower single-digit inflation rate is desired to boost consumer spending – which would in turn drive production, create jobs and promote economic stability. It urged government and policymakers to consider these patterns in policy formulation to enhance economic growth and job creation.
GEA president Dr. Emmanuel Adu-Sarkodee Afriyie, speaking at the association’s 64th AGM in Accra, promoted the need for government to adopt prudent fiscal policy management frameworks to control spending and ensure fiscal consolidation.
He noted that such measures are crucial for stimulating sustained economic growth at a minimum annual rate of five percent.
Last year, the Annual Household Income and Expenditure Survey report of Ghana Statistical Service indicated that the overall unemployment rate stood at 14.7 percent, with the urban labour market recording 18.3 percent.
But Dr. Afriyie emphasised that sustained economic growth would have positive repercussions on employment creation, as there is evidence of a strong relationship between a stable economic environment and job creation.
For instance, the Organisation for Economic Cooperation and Development (OECD) reports that a one percent increase in GDP growth of nations is associated with a 0.5 percent increase in employment growth.
The IMF also finds that a one percent decrease in unemployment rate results in a 1.5 percent increase of GDP growth.
Similarly, the US Bureau of Labour Statistics indicates that a stable economy creates an average of 150,000 jobs monthly, whereas the World Bank notes that a 10 percent increase in business confidence leads to a two percent increase in employment growth.
These findings, Dr. Afriyie maintains, reinforce the point that a stable economic environment is conducive to employment creation – as a strong and resilient economy leads to increased job opportunities while unstable economies occasion significant job losses and higher unemployment rates.
The association also appealed for government to consider the various constraints confronting employers and pursue actions that prevent consequential fiscal slippages and an unstable macroeconomic environment after the elections.
“This is particularly imperative as it will prevent the erosion of gains made in restoring the economy and further enhance the capacity of employers to expand and create decent jobs for the teeming youth” Dr. Afriyie noted.
Mr. Ignatius Baffour Awuah, Minister of Employment, Labour Relations and Pensions – in a speech read on his behalf, said fostering a conducive business and industrial relations environment is central to government’s economic transformation agenda.
He said government, as a result of its dedication to job creation, has committed itself in implementing reforms that attract domestic and foreign investments to stimulate job creation.
GEA’s CEO, Mr. Alex Frimpong, noted that confidence in the economy by employers is the key driver of business expansion and sustainable job growth.