As inflation continues its downward trend, minimum wage is trending in the opposite direction, a see-saw relationship between the two retail economic indicators that is supposed to spell a general boost in confidence in the economy. Yet the general feeling is that the man on the street is not feeling the globally acclaimed Ghanaian economic rebound.
So what will it take?
Some point to a few factors including the unemployment rate among the youth. That has also been on a downward trend albeit highly marginally. This leads to a lot of raised questions as to the notion that the economy that is enjoying global acclaim is not trickling down to the street level.
If of the three main retail economic indicators, two (inflation and minimum wage) are trending positively, and one (unemployment) is holding steady, it is easy to conclude that this notion of hardship is coming about as a result of political propaganda.
The data available and encapsulated by the displayed chart shows that in 2014, inflation was at 15.5%. In that same year, minimum wage was GHC6, almost half of what it is today. Unemployment stood at 13.5, virtually the same as it is today. And the dollar traded on average at GHC3.41.
Since then the dollar’s value has not doubled although one now needs two more Ghana Cedis to purchase it, but minimum wage has doubled. Youth unemployment has held steady, and inflation has dropped by almost 6.5 points to 9.1%. This means the minimum wage earner, aka the man on the street, has much improved purchasing power.
Even the street hawkers are admitting to improved earnings at the same time they are complaining that the economy is tough. Asked how the economy is, Kwabena Gyawu, who hawks around the 37 area in Accra, wasted no time to reply that “things are hard.” Upon further interrogation, however, Kwabena admitted to averaging GHC35 per day with a high of about GHC60. If Kwabena works only 22 days in a month, he is already earning better than a college educated NABCO trainee, and far better than the minimum wage earner.
Probed further, Kwabena admitted that he is able to do more today than he was five years ago. Then followed the obvious question: “if everything is going on well, and you are doing better than five years ago, why do you still say the economy is tough?” Kwabena’s answer was unexpected – “That’s what everyone says and that’s why I’m also saying it.”
There you have it. The economic hardship appears to be propelled mainly by hearsay.
Jermaine Nkrumah – DNT