Developments in BPO, Construction to Further Drive Down Unemployment

There is unwavering optimism among business leaders for further reduction in Jamaica’s unemployment rate, which has dropped to an all-time low of 8.4 per cent.

The out-turn, captured in the Statistical Institute of Jamaica (STATIN) July 2018 Labour Force Survey, is 1.3 per cent lower than the 9.7 per cent recorded in April 2018, and 2.9 percentage points below the rate of 11.3 per cent for July 2017.

Several business leaders, who spoke to JIS News recently, cite ongoing developments in business process outsourcing (BPO) and construction, including residential real estate, as major employment drivers, particularly for young people.

Jamaica Employers’ Federation (JEF) President, David Wan, says that the number of jobs generated in the BPO sector has doubled over the last few years, and “there are multiple infrastructure projects going on in Kingston right now, inclusive of road works plus private-sector developments, particularly call centre buildings”.

The road projects include works along Constant Spring Road, Hagley Park Road into Three Miles, and Mandela Highway.

Coupled with these are BPO projects on Half-Way-Tree Road, and housing developments along Ruthven Road, South Avenue and Surbiton Road in St. Andrew.

Mr. Wan also cites multibillion-US dollar investments by Chinese entity Jiuquan Iron and Steel Company (JISCO) in the expansion of the Alpart bauxite and alumina plant in Nain, St. Elizabeth, and development of an industrial park, all of which he expects will spur increased employment, particularly in the mining and quarrying sector.

Mr. Wan further mentions projects on the horizon, which will generate jobs and result in a reduction in the unemployment rate.

Among these are the Southern Coastal Highway Improvement Project between Harbour View and Port Antonio; extension of the East-West leg of Highway 2000, from May Pen to Williamsfield; and a major hotel development, slated to provide 1,000 additional rooms, for which the breaking of ground was recently announced by Tourism Minister, Hon. Edmund Bartlett.

“I see enough projects… coupled with the Government’s commitment to low interest rates, which will make credit easily available to the private sector for retooling and expansion of inventory… to drive higher employment generation,” he adds.

Former Jamaica Chamber of Commerce (JCC) President, Warren McDonald, also highlights BPO and construction as among the contributing factors to the reduction in unemployment.

“Whether it’s road infrastructure or buildings… when you drive around the city [of Kingston], I can’t recall so much construction taking place at any one time. So I think this probably has contributed to… the reduced figure,” he tells JIS News.

Mr. McDonald says he is particularly pleased with the 12-month 5.3 percentage point reduction in youth unemployment, which fell from 27.5 per cent in July 2017 to 22.2 per cent this year.

He attributes this “major drop”, in large measure, to a take up of persons by BPO entities.

“The youth cohort is the area that has had relatively high levels of unemployment… and the BPO sector, which is growing, is taking up the youth,” he notes.

Additionally, Mr. McDonald says that agriculture has been pivotal in facilitating engagements for persons, “especially as we have been having reasonably good weather”, resulting in increased buoyancy in the sector.

“So, overall, the reduction is welcome, and I am confident that if we continue on this path… and can control crime, because that is still a bugbear… we should see even further reductions,” he says.

Small Business Association of Jamaica (SBAJ) President, Hugh Johnson, also cites the BPO sector as a key area absorbing a number of persons in the labour force as well as construction, which he says, “is booming”.

He says that facilitating greater access by small construction companies to Government’s procurement process for the provision of goods and services will result in even greater reduction in unemployment.

STATIN’s July 2018 Labour Force Survey shows that the number of unemployed individuals fell by 27.7 per cent to 111,800, compared to the corresponding period last year.

The number of unemployed males decreased by 28.6 per cent to 41,800, while unemployed females fell by 27.2 per cent to 70,000. Unemployed youth, aged 14 to 24, decreased by 14,600 persons to 45,200.

The total employed labour force, as at July 2018, came to 1,226,400 persons, representing an increase of 12,800 individuals above the number for the corresponding period last year.

The number of employed males rose by 5,900 to 681,800, while female employment increased by 6,900 to 544,600 persons.