Thirty four (34) percent of businesses in the country laid-off workers in the last six months due to the power crisis and other economic challenges.
According to the IEA’s maiden Business Confidence Survey, most of the retrentchment were in the non-financial sector. The business confidence survey solicits the views of private enterprises on how they are faring.
The survey was conducted in three regions of Ghana; the Greater Accra Region, the Western and Ashanti Regions.
The survey revealed that the major obstacles in doing business in Ghana, 95% of the respondents cited the erratic power supply which was closely followed by the cedi depreciation, taxes and government charges.
Business owners were however optimistic that the situation will improve within the next 6 months which they believe will yield more profits. Presenting the highlights of the report, a senior fellow at the IEA, Dr J.K Kwakye stated that the net loss of job losses was to be expected due to the deterioration of the business environment.
The IEA therefore made three recommendations which will help policy makers revive businesses as well as forestall any further job cuts.
The first recommendation was the need to urgently relieve businesses of the many constraints including the power crisis, cost of credit and infrastructure.
This, according to Dr. Kwakye will help promote the private sector as the engine of growth in Ghana. The second recommendation was the urgent need to ensure a stable macroeconomic environment through public financial management to create a more conducive environment to aid business growth.
Thirdly, the IEA recommended that serious interventions are needed to address the unemployment situation at the firm level.
This they believe should be done through the provision of incentives for private firms to employ the youth to curtail the looming danger of more job losses.
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