Edgar Brandt
Windhoek-More than 129 000 Namibians lost their jobs since 2014 due to drought and the global financial recession. This is according to a recent presentation by the Economic Association of Namibia (EAN).
Coupled with government’s fiscal consolidation and fiscal constraints, employers are faced with critical decisions on how to cut costs and unfortunately, in most cases, employees constitute one of the highest cost factors for businesses.
“A few weeks ago, we were receiving daily enquiries on how to reduce staff, retrench, etc. This appears to have slowed. Thus, there may be less retrenchments in the coming months,” said Tim Parkhouse, Secretary General of the Namibian Employers’ Federation (NEF).
Parkhouse added that the large numbers of retrenchments in recent months must be directly related to the government’s fiscal constraints, particularly in respect to construction, which has had a knock-on effect on small contractors and then on to the retail trade. “It appears unfortunately that in general there was too much dependency on government contracts not only in construction but also for example motor repairs,” Parkhouse stated.
While admitting that there is not much government can do at the moment, he noted that Value Added Tax (VAT) refunds from the Receiver of Revenue could help significantly if released. However, he pointed out that with too little cash available in government coffers, these VAT refunds cannot be released.
“We suspect that we will see a higher number of defaults on loans. Consumer cash is lower, so the knock-on effect continues. For example, new vehicle sales are down around 25 percent compared to last year. This means in a year’s time, there will be approximately 25 percent less vehicles going for service and in two to three years, 25 percent less vehicles will be needing new tyres, etc, etc,” said Parkhouse.
When asked what employees can do to ease the pressure on employers, Parkhouse advised that at this time, unreasonable demands for salary increase would not help.
“We appeal to employers to consider the humanitarian issues as much as possible. We advise anybody who has a job to keep it, look after it, be loyal, even if the conditions of work are not the best. Be grateful that you have some income,” Parkhouse stated.
A total of 129 644 Namibians lost their jobs since 2014 due to the drought and global financial recession, according to Economic Association of Namibia.
In a recent presentation on the Namibian economy and its future prospects, Executive at the EAN, Klaus Schade, on Tuesday, said since 2014 more than 74 000 people lost their jobs in the agriculture and fishing sector. He added that more than 31 000 in wholesale and retail trade, over 11 000 in public administration, close to 8 000 in the private sector and about 4 400 people in the transport and storage sectors.
Giving a breakdown of job loss per region in the agricultural sector, Schade said, Omusati Region saw the highest job loss with 22 794, while 8 730 losses were recorded in Kunene, 7 564 in Ohangwena and 6 919 in Oshikoto. He emphasised that wholesale and retail trade was affected by retrenchments in the construction and related industries.
He further noted that mining can expect an upsurge with the new commissioned exploration vessel, while zinc and copper prices have increased due to demand. He also said Husab Mine is expected to increase its production in 2018.
“Husab, at full production, is the second largest uranium mine globally and its full production will have an impact on global prices,” said Schade, adding that the production currently remains at low levels.
– Additional reporting by Nampa