chapter  5
71 Pages

Ghana

ByERNEST ARYEETEY, WILLIAM BAAH-BOATENG,

Ghana’s economic growth performance has been easily one of the better known in Sub-Saharan Africa over the past three decades. The country’s annual growth performance averaged 5.1 per cent between 1984 and 2010. A rebasing of the country’s national accounts in 2006 pushed the country from being lower-income to the ranks of lower-middle-income countries with an annual average real GDP growth of about 8.5 per cent during 2006-11. The good growth performance has not, however, been reflected in the generation of productive, decent and sustainable employment. It is estimated that the employment elasticity of output dropped from an average of 0.64 in 1992-2000 to 0.52 and 0.4 in 2001-04 and 2005-08, respectively (ILO, 2008a). Employment growth has tended to lag behind economic growth, as reflected

in the divergence of growth of national output and employment. An annual average growth of real GDP of 5 per cent between 1992 and 2008 could translate into only a 2.7 per cent annual average employment growth over the same period. Estimates from the last three rounds of the Ghana Living Standards Surveys (GLSS3, 4 and 5) indicate that total employment increased from 5.79 million in 1992 to 7.07 million and 9.14 million in 1999 and 2006, respectively (Figure 5.1). These represent average annual employment growth of 3.94 and 2.69 per cent over 1992-99 and 1999-2006, respectively, with projected total employment at about 10.05 million in 2010 against actual total employment of 10.24 million, based on the 2010 population and housing census. The slow response of employment generation to growth of the economy is

largely linked to the slow growth of the labour-intensive sectors of the economy, such as manufacturing and agriculture, as against remarkable growth of low labour-absorption sectors of mining, finance, telecommunication and cocoa. Estimates from National Accounts indicate that during 2000-10, while agriculture and manufacturing grew annually on average at 4.7 and 3.7 per cent, respectively, mining and quarrying, finance, insurance and business, and

8 7

1 0

- • ao 7.17.2 7.4 f .o .:...~5.~· 1 ~L ii~ f..- I -~

~ ,...- 1"-.