Ayerakwa calls for living wage as low incomes undermine Ghana’s economic recovery

Ghana needs to move from a minimum-wage framework to a living-wage system to ensure that employment provides workers with enough income to meet their basic needs, the Director of Research and Administration at Africa Policy Lens, Hayford Mensah Ayerakwa, has said.

Ayerakwa said the creation of jobs alone should no longer be treated as sufficient evidence of economic progress because many workers remain economically insecure despite being employed.

“We need to move from minimum wage to living wage,” he said on the Asaase Breakfast Show.

He said Africa Policy Lens’ research showed that employment and income security remained a major weakness in Ghana’s economic recovery.

Ayerakwa said many households were economically active, particularly through self-employment and informal-sector work, but such jobs were often characterised by uncertain incomes, inadequate earnings and weak employment protection.

He also questioned whether the earnings of many workers were sufficient to cover basic living expenses.

Using a hypothetical young graduate earning GH¢3,000 a month, he calculated that the income amounted to about GH¢100 per day, or roughly GH¢12.50 an hour for an eight-hour working day.

That income, he said, would have to cover transportation, accommodation, food, water and other household expenses, leaving little room for savings or unexpected costs.

Ayerakwa argued that government should pay greater attention to income growth and purchasing power alongside employment numbers.

He also urged policymakers to prioritise agriculture and local production as engines of employment, arguing that the sector could absorb workers across a wide range of professions.

“Agriculture is the most employer of the labour force,” he said, stressing that difficulties faced by farmers therefore had wider consequences for household incomes.

He criticised what he described as an overreliance on headline growth figures, noting that recent growth had been driven partly by mining and quarrying, sectors that use sophisticated technology and therefore have limited capacity to absorb large numbers of workers.

Ayerakwa also raised concerns about local producers struggling to find markets for their goods while imported alternatives remained available.

He said the situation had contributed to difficulties among rice and maize farmers, including instances of gluts after local production encountered weak demand.

He argued that government, as a major consumer in the economy, could use public procurement to create demand for locally produced goods and services.

“If government decides that, going forward, every single government—everything, being goods or services—will have to be locally procured,” he said, arguing that government consumption could help keep local producers and suppliers in business.

Ayerakwa said such measures would help strengthen local businesses, protect jobs and improve household incomes.

He maintained that economic policy should ultimately be judged not only by the rate at which GDP grows but also by who benefits from that growth and whether the jobs created provide adequate livelihoods.