Editorial | Where’s the labour reform report?
Ongoing discussions about Jamaica’s shortage of skilled workers raise questions about the status of the island’s labour reform project, including why, half a decade after a high-powered team completed a report on the subject, it appears to remain swaddled with mothballs.
It is also an opportunity for Pearnel Charles Jr, who became the labour minister six months ago, not only to assume full ownership of the labour reform agenda, but to propel his portfolio to the centre of government as a key economic ministry.
Like the Patterson Report on education transformation – of which it ought to be the flip side – the labour market document, insofar as this newspaper can discern, has not been tabled in Parliament, or sent to a parliamentary committee for review. And similar to the Patterson Report, too, the government has spoken of implementing elements of its findings, which was the claim of the former labour minister, Karl Samuda, in a 2021 parliamentary speech, without being specific on what was being done and why they were deemed the priorities.
This seemingly cavalier approach to the labour market report is undeserved by the late Marshall Hall and his fellow commissioners, who spent more than two years listening to experts and applying their minds to producing the document. It would hardly be surprising if Orlando Patterson and his commissioners share similar sentiments over how their report has been handled.
After nearly a dozen years of fiscal reforms, Jamaica’s economy has achieved macroeconomic stability. Public-sector debt, which was over 145 per cent of GDP in 2012, is now down to 84 per cent and on track to reach the benchmark 60 per cent by 2028. The government runs a primary balance of nearly six per cent of GDP. Unemployment is at a historic low of 4.5 per cent.
Paradoxically, though, having recovered from an 11-per-cent slump during the COVID-19 pandemic, growth continues to be sluggish – projected at 1.8 per cent in the current fiscal year, and is expected to be only slightly better in 2024-25.
Additionally, over the five years up to 2022, labour productivity declined at an annual average rate of 0.8 per cent, or more than twice as fast as the 0.3 per cent annually during the five years to 2015, when Professor Hall’s commission began its work. And while there is no recent comparative data on the question, there is little to suggest any significant improvement in the figure of approximately two-thirds of Jamaicans who are without certification or specific training for the jobs that they do.
It is against this backdrop that business leaders have complained of a lack of skilled workers, and have urged the government to relax immigration and work permit regimes so as to cover the shortfall.
“At the lowest end, you tend to have labour availability, but as you go up the value chain … there is a shortage in Jamaica and the situation is continuing to get worse,” Richard Pandohie, the CEO of the Seprod Group, lamented recently.
Prime Minister Andrew Holness has suggested that his administration might be inclined to acquiesce, although he is mindful that around three-quarters of a million Jamaicans – a figure equivalent to 52 per cent of the workforce’s size – remain outside the labour force. The PM is also concerned that this shortage of skilled labour will ultimately retard investment and growth.
DEEP PUBLIC DISCUSSION
Given these concerns, it would be expected that labour market reform would be central to a deep public discussion of an industrial policy, suited to the 21st century, that has the embrace of all sectors of government, the private sector and labour. Indeed, how Jamaica structures its education and training systems, to produce workers capable of operating in the new, technology-driven global paradigm, is critical to these arrangements.
Or, as the labour market reform commission noted in its report, which outlines a raft of things for the government to do: “The ministries of Labour and Social Security, and Education and Youth … are central to the reform agenda, and most of the LMRC’s (Labour Market Reform Commission) recommendations relate to them and/or agencies that fall within their purview.”
In that regard, Mr Charles, the labour minister, should table in Parliament forthwith the labour market reform report. And if it were tabled, but somehow fell between the cracks, he should retable it and insist that it be forwarded to the relevant parliamentary standing committee for review. He should also coax – or rather, demand – that the Cabinet causes the same to happen with respect to the Patterson Report, so as to drive public engagement on how Jamaica can transcend its disastrously poor education outcomes.
In other words, Mr Charles should grab the issue of labour-market reform by the scruff of the neck and make it his own. And he should do so even if he has to drag his Cabinet colleagues kicking and screaming along the way.