Economic growth fluctuated between -1.1% in 2009 and 7.1% in 2006, resulting in an average growth rate of 4.38% over the period 2006 to 2012.
This was less than SADC’s 7% expected growth, which had been stable up to 2009 – at which point the global economic recession and financial meltdown negatively affected economic growth. Additionally, budgetary allocations to education were stable, even in 2009, bringing average allocation to roughly 24% of the total budget in the same period.
In terms of contribution of the education sector to economic growth, average contribution was 5.5%. In fact, the above-mentioned contribution fluctuated from 3.8% in 2006 to 7.42% in 2012. As budgetary allocations to education were stable, contributions by the education sector to economic growth demonstrated the same stability, with gradual increases from 2006 to 2012.
When SADC-PET was being integrated into Namibia’s education system, the economy was stable in terms of economic growth. The education sector was also stable, as it received regular allocations along with stable economic growth. Indeed, it is a relevant correlation to produce skills as labour markets demand.
Stability and gradual improvement of the education sector took place and should be viewed as the stable contribution of the education sector to GDP. In short, it is pertinent to conclude that the Namibian education sector contributed to the economy in a stable and sustainable manner.
The first aspect relates to the general wellbeing of people according to the availability or provision of basic needs, such as food, clothes, shelter, healthcare, and education. When people are employed, they are able to afford these items with their income.
Income depends on payment for labour, which in turn, depends on human capital investment, or as has been shown, the level of education an individual possesses. In terms of the production of goods and services, the four factors of production play an important role.
This is indeed the distributional aspect of GDP, as all factors of production receive a share of income. If we view human capital as employment in economic terms, then we can focus on SADC-PET as employment in education. This means that those employed in the education sector contribute to economic growth and economic development concurrently. The second aspect is government’s role in economic development. Government collects taxes from the economy, based on economic growth. Accordingly, tax revenue is spent to provide services, such as education and health (in a broader sense, human capital development), and in return, provides social services.
As a result, government expenditure affects people in many ways, including their general welfare. However, it should be noted that individual income is also integral to the overall improvement of people’s welfare, as they too invest or spend on education and health.
Furthermore, educated people can look after their health and that of their families better than people with less, or no education can. Positive aspects of government expenditure can be evaluated in terms of poverty-reduction, child mortality reduction, maternal health improvement, and of income inequity reduction (i.e. Gini-coefficient).
The third aspect concerns social returns to education. In general, well-educated societies are peaceful, respect each other, and usually follow democratic principles. Such societies are politically, economically, and socially stable. As a result, law and order generally functions as expected. Although this study shall not assess social returns to education, they are of paramount importance in maintaining economic growth and development in any country.
Average employment in education during the period under review was 25,244 and represented an average of 4.2% of the total labour force in the country. Employment in the education sector declined by 12% from 27,876 in 2007 to 24,512 in 2008 and subsequently went up again to 27,001 in 2012. This shows that employment not only contributed to the growth of education, but it also contributed to the country’s economic growth in a stable and sustainable manner.
In 2012, unemployment in Namibia was down from 51% in 2008 to 27.4%, which is higher than the 5% expected by Vision 2030. However, there is clearly a positive relationship between educational attainment and unemployment rates – the higher the education level, the lower the unemployment rate.
In this connection, the unemployment rate for people with no higher education is estimated at 29.7%, while the unemployment rate for those with tertiary education is less than 10%.
• Dr David Namwandi is a PhD holder in Business Administration from Asia-e-University, Malaysia.