EDPRSII: Tracking the 200,000 off-farm jobs

In the Northern Province town of Musanze, 24-year-old Obadia Ndayisaba, a recent graduate of Statistics from the University of Rwanda, is busy working the books of a sports betting outlet ahead of the first match of the new season of the English Premier League. After unsuccessfully chasing for a job at the National Institute of Statistics of Rwanda (NISR), Obadia gave up. Yet, while government aims to create 200,000 off-farm jobs per year under the Hanga Umurimo programme, NISR lacks statisticians such as Ndayisaba to track those jobs in the economy. It’s therefore a challenge to know whether the target is being achieved or not. Back in Kigali, on the third floor NISR offices in Muhima, Marc Jean Mukundabantu, a labour statistician is busy. He is one of NISR’s only four labour statisticians but the power to recruit more people isn’t within NISR’s mandate, but that of the Ministry of Labour (Mifotra). EDPRSII targets Last year, government pledged up to 200,000 off-farm jobs as highlighted in the EDPRS2 - the blueprint that guides the country’s development and poverty reduction intervention. To actuate this ambitious strategy, a cocktail of job creation initiatives has been advanced. One of the elements in the job creation cocktail is the Hanga Umurimo programme. In the first week of December 2012, the Ministry of Commerce (Minicom) officials headed to Obadia’s town of Musanze in the Northern Province to launch the pilot phase of the project in which 16,000 business ideas were received countrywide. The pilot phase was deemed a success and now Hanga Umurimo is a fully fledged national programmne that has accumulated over 30,000 business ideas all seeking for funding from Banks. With Minicom working closely with the Business Development Fund (BDF), hopefuls undergo training to horn their business plan writing skills, financial and business management before introducing them to banks for possible financing. From the business plans submitted to banks, those that are approved are then guaranteed by BDF for up to 75 per cent of the loan that an applicant wants for the start-up budget. “The guaranteeing means we are assuring the banks that in case the business plan doesn’t succeed, BDF will stand in to cover the bank’s loss up to 75 per cent, this is done in order to encourage banks to lend to these SMEs,” Innocent Bulindi, BDF’s chief executive, said. Today, at least 4,443 Hanga Umurimo SME files have been sent to various banks, of which 2,965 of them have been approved for funding. After being helped to find funding and finally opening shop, government expects one thing from the SMEs: jobs. That’s why successful proposals have to show a high potential for job creation. So where are 200,000 jobs created so far? The New Times put the question to Mukundabantu, NISR’s labour statistician. “We don’t have the capacity to track those 200, 000 jobs that are allegedly created every year, it’s almost impossible,” he said. This means that NISR, the country’s ‘go-to’ agency for key figures regarding economic growth indicators isn’t in position to regularly track new jobs joining or leaving the economy. But it can calculate GDP growth and consumer price index. So, if the 200,000 new off-farm jobs per year can’t be tracked, does this mean the program can’t be assessed for failure or progress? Well, not exactly. NISR says they can calculate the role of job creation programs by comparing two periods to calculate the net change in employment trends. That’s mainly through the national census. “For instance, by looking at the number of employed youth in 2002 in comparison to those in employment by 2012 when the last census was done, we can know the number of people who found new jobs,” Mukundabantu said. The number of employed youth aged between 16 and 34 increased from 1,878,083 in 2002 to 2,483,399 in 2012. That means over a 10-year period, 605,316 youth found jobs. It would also mean, on average, 6,0531 jobs were created every year between 2002 and 2012. What the census doesn’t answer, however, is who created those jobs, when and what sectors. In other words, there’s no way such figures can be related to the initiatives that are supposed to deliver the 200,000 jobs every year. “That’s partly because the census uses a broad survey instrument that measures several indicators of the country; employment is just one of them. To measure the 200, 000 job efforts, one needs a special survey done regularly and asks questions that are exclusive to job creation and employment,” he said. During the 2011 man power survey, employers were asked ‘how many new jobs do you plan to create next year?’ While such a question could paint a picture of possible jobs to be created in the next year, a special survey would still be required to determine how many were actually created. That, again, is not in the capacity of NISR to do. A good example is here; according to MINICOM, the 168 SMEs that got funding to the tune of Rwf2.2billion under the pilot phase of Hanga Umurimo, reportedly ‘created 1500 jobs.’ It’s not clear whether these are jobs that ‘were to be created or have been created.’ Building capacity It’s clear at this point that on top of putting money into SMEs to create jobs, government also needs to invest in job statistics infrastructure to track the direct progress of its job creation initiatives. “A good way to start is by improving NISR’s capacity, help them count better,” said a government official who preferred to tremain anonymous because they are not authorised to speak on behalf of the institution. For instance, NISR, as already pointed out has only four labour statisticians who have to compile labour statistics in the country. They clearly need more hands and heads. According to Mukundabantu, the team needs at least 17 technical personnel of which they have only four at the moment. But the power to hire for NISR is under Mifotra’s realm. The New Times also understands that starting 2017, NISR plans to launch an annual labour force survey whose main objective would be to track the number of new jobs created every year. This would be the closest that NISR can get to provide regular job data for the country that is so ambitiously creating jobs but with no capacity to track them in the economy. “If job creation is that important an indicator in measuring economic growth, then we must know how many we are creating every quarter, every year just like other indicators such as GDP but we are not yet there,” says the anonymous government source. That annual survey, The New Times understands will target a sample size of at least 16,000 households and all questions will be related to jobs and employment. “From 2017, we can at least expect to have reliable job statistics but right now, we are struggling,” the labour statistician says. An annual job survey would have cost implications. First, it would call for recruitment of more people which would in turn inflate NISR’s budget. For instance, a source within NISR’s planning unit says the agency’s budget for July to September is Rwf2.9 billion, but for the institution to carry out regular annual job surveys, it would need far more than that. By 2017 when the first annual job survey is expected, the deadline for the targeted 1.4 million jobs will have clocked. It would be good to know how many jobs have been created under EDPRSII.