Answering the call for jobs, jobs, jobs

Dennis Morrison, Contributor

With the Jamaican economy slow to recover, the news that there was 2.5 per cent growth in the third quarter of this year was a spark of hope after three years of decline.

But the report that in September the growth rate had fallen to only 0.5 per cent, and that bad loans in the banking system had risen further, was a reminder of the fragility of our economic situation.

A preoccupation of Jamaica's leaders in government and business must, therefore, be implementing measures that can jump-start production and employment in the short term, while structuring policies and programmes for the medium term. The engagement and cooperation of the workers' movement and civil society will be important to success.

Public works are an obvious area that can stimulate economic activity and employment in the short term. More recently, the entire focus has been on road construction, but the truth is that projects covering drainage, shoreline protection, retaining walls and prevention of soil erosion, and river training are more labour intensive.

Even more important is the fact that our neglect over the years of these vital areas has been extremely costly, as demonstrated by the damage from natural disasters. For example, Tropical Storm Nicole alone left us with infrastructure damage of $13 billion last year.

In the last decade, the eastern parishes of St Mary, Portland and St Thomas, and some southern parishes, were hit by at least seven hurricanes, leaving major damage to physical infrastructure that is still to be restored. A systematic programme concentrated on labour-intensive rehabilitation works is an obvious item for immediate public-sector investment. Resources for this purpose can be secured by reallocating funds from existing programmes like Jamaica Development Infrastructure Programme. Implementation of new community-development programmes that emphasise infrastructure upgrading, and for which funding has already been secured, must be expedited.

housing

Another area where existing resources can be redeployed to boost construction activity in the short term is in housing. In previous years, there was a deliberate effort made by the National Housing Trust to set aside funding for projects that utilised small contractors and their tradesmen. It would appear that this is not now being given the same emphasis with systems-built schemes now dominating the landscape.

It is surprising how Jamaica has been missing the opportunity to push ahead with a significant programme of energy conservation, including retrofitting of businesses and households. This cannot be for shortage of funding, given the resources available under PetroCaribe, and from multilateral sources, and particularly as some of these measures also have short payback periods. Not only would such a programme strike a blow for cutting the country's energy bill, but it would generate employment for electricians and provide income for small and medium-size businesses.

tourism investment projects

A big bang to employment, foreign-exchange inflows, and overall economic activity can come from the execution of major tourism investment projects that have been pending. Several of these projects have already gone through the entire approvals process and investors have now to be induced to break ground. Investment promotion and facilitation activities must, therefore, be intensified. Tourist investment projects in other Caribbean destinations like The Bahamas that were stalled during the recession are now moving ahead, and we would not want to fall behind.

In Jamaica, while the resort projects are generally located on the northwestern coast, their impact would be felt across the country, with skilled workers being drawn from other areas and local products and services as well. The addition of new rooms is a significant factor, too, in keeping Jamaica's tourism industry competitive and on an expansion path. New rooms add to the attractiveness of the island and increase stopover visitor arrivals. The burst of new hotels in the last five years largely explains why the industry continued to record growth, even in the deep recession.

Encouragement by way of funding and incentives for refurbishing of existing hotels, especially the small properties, is essential. Plans need to be turned into action. At this level of the industry, the impact on employment is greater as well as other linkages to local agriculture. By now, most people should be aware that there will be the need for tightening up of spending in the public sector, which is bound to lead to job losses in the administrative side of government. But with a proactive and targeted approach to economic management, opportunities can be opened up to compensate for the negative effects.

Dennis Morrison is an economist. Email feedback to columns@gleanerjm.com.