Labour problems hurt competitiveness

By: JO-MARÉ DUDDY

WORSENING labour market conditions are hijacking Namibia’s competitiveness, the latest research by the World Economic Forum (WEF) has shown, with the country plunging nine positions on its 2012-13 Global Competitive Index.

The index, released yesterday, places Namibia 92nd overall out of 144 countries worldwide, down from 83rd last year.
This is the second consecutive year that Namibia nosedived nine positions. In 2010-11, the country was ranked as the 74th most competitive worldwide.
Namibia took a massive hit of 17 positions in the category for labour market efficiency in the 2012-13 index.
Last year, Namibia was ranked 57th in this category; this year it fell to 74th.
Labour market efficiency is one of the 12 pillars the WEF uses to comprise the Global Competitive Index (GCI).
To rate this pillar, the WEF looks at eight indicators, ranging from hiring and firing practices to pay and productivity and brain drain.
Namibia fared worse in seven of these indicators compared to 2011-12.
Last year, Namibia was among the 40 least competitive countries in the world for only one the eight indicators. This year, four of the indicators placed the country among the bottom performers: cooperation in labour-employer relations (116th), flexibility of wage determination (101st), hiring and firing practices (130th) and pay and productivity (107th).
The WEF said Namibia weakened “across most areas measured by the index”.
The WEF put the 12 pillars of the GCI into three groups. In all three these groups, Namibia’s 2012-13 ranking was lower than in 2011-12.
The country was placed 82nd for Basic Requirements, down 14 positions from last year. In this group, the WEF rated infrastructure, the macroeconomic environment, institutions, as well as health and primary education.
The WEF said Namibia’s health and education indicators are “worrisome”.
“The country is ranked a low 120th on the health sub-pillar, with high infant mortality and low life expectancy – the result, in large part, of the high rates of communicable diseases.
“On the educational side, enrolment rates remain low and the quality of the educational system remains poor, ranked 127th,” the WEF said.
The second group, called Efficiency Enhancers, considers higher education, the labour market and financial market development among others. Here Namibia was ranked 105th, eight places lower than last year.
The last group is called Innovation and Sophistication Factors, and looks at business sophistication and innovation in a country. Namibia was placed 103rd, compared to 95th last year.
Despite its sliding performance, Namibia was ranked as the fifth most competitive country in Sub-Saharan Africa. South Africa (52nd worldwide) was ranked first, followed by Mauritius (54th globally), Rwanda (63rd globally) and Botswana (79th globally).
Switzerland topped the overall rankings, with Singapore second, and Finland in third position. They were followed by Sweden, Netherlands, Germany, the United States, the United Kingdom, Hong Kong and Japan in the top ten.

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