Uganda's economy not ‘producing quality jobs’

A report indicates that few people are absorbed by Uganda’s labour market. PHOTO | FILE

By TOM ANGURINI

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By NELSON NATURINDA

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Uganda’s constant economic growth of 5.4 percent in the past two decades has had

little impact on improving quality of jobs available in the market, says a new report by National Planning Authority.

“Working age population grew from 16.5 million between 2012-13 to 19.1 million in 2016-17,” the report shows.

According to the report, 700,000 people enter the labour market every year but only about 238,000 or 34 percent are absorbed. This is expected to rise to about one million a year between 2030 and 2040, according to the World Bank.

“The quality of jobs, however, is low. Only one in five workers are in waged employment, although outside of agriculture, the share is about half in waged work,” reads the report.

According to International Monetary Fund, Uganda's economy will expand at 3.8 percent in the 2021/2022 fiscal year from a previous projection of 4.3 percent, thanks to effects of Covid-19.

Uganda Bureau of Statistics records show 77 percent of the estimated 45 million people are aged below 25. The unemployment rate for young people in Uganda, aged 15-24, is 83 per cent, the bureau says.

This rate, according to the World Bank report “is even higher for those who have formal degrees and live in urban areas.”

While releasing report on Tuesday, Dr Joseph Muvawala, the executive director of the National Planning Authority, said the working age population is growing faster than economic growth.

“The National Development Plan III job creation strategy must focus on expanding and diversifying economic growth while maintaining macro-economic stability in order to create increased demand for labour,” he said.

He said these jobs will mainly come from the service sector with the trade sector contributing the largest part. However, most of the jobs from trade will be from petty trade, mainly comprising the informal sector such as vending, supplies, transport, which are done by semi-skilled people. The university graduates will still find it challenging to get employment.