• This week, the nation has lamented the appointment of former Othaya MP Mary Wambui as the chairperson to the National Employment Authority.
• Questions have been raised about her competence, age, meritocracy and distance decay with the youth unemployment realities. And rightfully so.
Image: FILE
One day while visiting a certain country, an economist came upon a large crew of men building a dam with picks and shovels.
When the economist enquired why in this day and age the men would use such crude equipment for such a gigantic task, his government bureaucrat host responded that this was a State-sponsored job creation programme, and that if the men were given modern tools to construct the dam, the task could be completed in a few days, rather than many months, thus destroying many jobs.
“Oh”, the economist responded, “I thought your goal was to build a dam. If it is more jobs that you want, why don’t you have your men use tea spoons instead of shovels? That way the task will take many years to complete, and many more people will get jobs”.
This week, the nation has lamented the appointment of former Othaya MP Mary Wambui as the chairperson to the National Employment Authority. Questions have been raised about her competence, age, meritocracy and distance decay with the youth unemployment realities. And rightfully so.
But I submit we are asking the wrong questions. We are engaging in an erroneous debate. We are being distracted by applying an ad hominem reasoning. Ad hominem is a fallacious argumentative strategy, whereby people avoid a genuine discussion of the topic at hand and instead attack the character of the person associated with the issue, abuse them, profile them and demean them in every possible way, rather than cross-examine the substance of the issue itself.
Hurling insults at Wambui is an exercise in futility. It is akin to squeezing water. We ought to instead interrogate, the utility of NEA. NEA is a State agency established by an Act of Parliament to provide an institutional framework for employment management, formulation of employment policies and strategies, enhancement of employment promotion interventions; and increasing access to employment by the youth, minorities and marginalised groups.
Begs the question, is NEA’s vision to provide employment opportunities for all attainable?
The brainchild of this State agency had their heart in the right place. As with most of us, they were concerned with the high rates of unemployment in the country. According to the World Bank, the unemployment rate was at 9.31 per cent in December 2018. Unemployment rate is the share of the labour force that is jobless.
In economic-speak, it is not everyone that is without a job that is considered unemployed. Unemployed people are those who are willing, able, available to work, and are actively seeking work. Many people who would like to work but cannot, for example, due to a disability or infirmity, or who are incarcerated, or who have become discouraged after looking for work without success, and hence have ceased actively looking for work, are not considered unemployed. They thus do not form part of the unemployment rate.
With this understanding, let us revisit the utility of NEA. Their mission is to formulate and implement employment policies and programmes for the creation of sustainable employment for all Kenyans.
Dear Kenyans, jobs are not created by waving a magic wand in the air, or in a political party’s manifesto, or by employment authorities, policies or State programmes. The problem of unemployment is not the inability to create enough jobs for all, but the creation of value. Jobs are a response to market demand. Just like the men using shovels and picks to build a dam, we could ban all use of computers and create jobs for people to write for us using paper and pen, ban all light switches and create jobs for lamplighters, and ban all music apps and create jobs for live bands. You see, creating jobs is the easy part. However, creating value, is a different kettle of fish altogether.
The reality is that NEA and other State job programmes increase unemployment rather than the reverse. This is because the money required to pay Wambui and her entire staff, her work programmes and their total administration, is extracted from taxpayers. This is money that tax-paying entrepreneurs could have on the contrary used to hire an extra worker, invest in research and development, or increase their equipment and machinery to produce cheaper and better quality value products faster and more efficiently.
The key to reducing unemployment is not to focus on job creation but rather on value creation. One way to do this is by catalysing and incentivising the innovation ecosystem. Innovation is the fundamental source of value creation in any economy. Granted, oftentimes across the innovation spectrum, there is some State funding of research on one end, but rarely on product development on the other end. In the middle is the graveyard gorge, where several promising innovations die a natural death for lack of resources needed to usher them to the next stage in this spectrum.
To cross this valley of death, there is need to facilitate the interplay of the innovators with the intention to exploit discoveries derived from their innovation and graduating them to their commercial potential. The State can easily do this through actions such as college scholarships for promising innovators, tax reduction for input imports, regulatory and licensure relief.
So the next time there is a discourse around creating jobs, stop listening. Creating jobs should not be the end game. Jobs will come into existence when there is a conducive environment to create value. Rather than establish NEA and its likes, the State should set people free to use their talents, to create value for others, and the jobs will naturally follow.
Finally, my unsolicited advice is to Wambui’s disparagers and crafters of NEA; even the smartest person cannot learn if a teacher uses black chalk on a blackboard in a dark room. Likewise, it is not about Wambui’s competence or lack of it; or the nobility of NEA. It is simply that jobs respond to market demand; and the institutional architecture of NEA cannot stimulate this demand; neither can it predict it in isolation. So it does not matter who is at NEA’s helm; or how smart they are. It is mission impossible.
The trouble with unemployment is that the minute you wake up in the morning, you're on the job- Slappy White.