Unemployment numbers looking good; SMEs need the banks to step up
We hope that the crime pestilence did not overshadow Wednesday's release of data from the Statistical Institute of Jamaica (STATIN) showing that the country's unemployment rate has dropped to a new low of 7.8 per cent.
For April this year, unemployment was two percentage points lower than the 9.8 per cent recorded for the corresponding period last year, meaning that the number of jobless fell by 25,900 to 105,900 individuals.
From the figures revealed by director general of STATIN Carol Coy we note the consistent trajectory of more women gaining jobs, which is a most happy development.
“Male unemployment rate declined by 1.8 percentage points to 5.5 per cent, while the corresponding figure for females fell by 2.1 percentage points to 10.6 per cent,” said Ms Coy.
It was also heartening to see that the unemployment rate for youth, aged 14-25, fell by 6.4 percentage points from 25.9 per cent in April 2018 to 19.5 per cent this year.
Further, the employment rate for male youth declined by 6.4 percentage points to 14.5 per cent, while the rate for female youth declined by 6.6 percentage points to 25.8 per cent.
These employment numbers are encouraging news, especially when added to the other macroeconomic indicators, all of which are pointing in the right direction. No matter which political party one supports, all Jamaicans wish to see this continue.
If the country stays on this course we will slowly but surely eliminate the curse of “bitter medicine”.
Still, let us not forget that for many or our fellow citizens, the question is: How long is it going to take for all this growth to impact ordinary Jamaicans? The cry which is heard almost daily is that prices of even the most basic food and other items, including medication, are constantly rising.
Prices of essential commodities are directly affected by the rate of exchange, as most of these items are imported. At the time of writing, the US dollar ended trading at $137.31.
A sustained spike has taken place over the last two weeks, and this spike is graphically showcased when we go to the shops and supermarkets. There is a chronic need to export more, to buy more locally produced items, and for the Government to ease, if not remove, most of the bureaucracy which weigh down businesses on a daily basis.
We also note the poignant words of a former president of the Jamaica Chamber of Commerce Larry Watson who stated: “…It is easier to access a loan from the banks to buy a car than to get a loan to start a business.”
Operating without the cushion of a strong and productive middle class of entrepreneurs — which largely depends on the banks for start-up capital — can prove to be a major hindrance to further growth.
Let's face it, the banks are doing well from a profit standpoint, and they must do more to assist in advancing the growth of the many small and medium-sized enterprises (SMEs) which make up much of their customer base.
Senator Aubyn Hill stated quite vociferously at a recent SMEs symposium that, “the banks have failed us.” We hope that this was just a desperate call for our bankers to readjust their formula for lending in order to assist in propelling further growth.
There is no better time than now.