Curbing unemployment through education and training


Ban Ki-Moon

BAN Ki-Moon, Secretary General of the United Nations (UN), described today’s global youth unemployment as a formidable challenge which global leaders must tackle (The Guardian, Tuesday, June 24, 2014, p. 47.) The Guardian report quoted Ki-Moon to have said: “Youth unemployment is an ‘epidemic’ that represents a great test of our time.

In countries rich and poor, unemployment rates for young people are many times those of adults – and of course, unemployment is the tip of the iceberg,” during an ILO event on youth unemployment. The International Labour Organisation (ILO) and the World Bank also raised similar alarms about unemployment and poverty in the past decades.

The World Bank and the ILO have again lamented the unemployment and poverty situations in the world in 2015. Why are the twin-problems of unemployment and poverty worsening in an increasingly richer world and in view of the many alarms that world leaders and institutions have raised over decades? More education, curriculum-based training and full employment policy are the solutions to the global menace of unemployment and poverty.

No one solves a problem he or she does not understand. The social scientists and social sciences – sociology, anthropology, psychology, economics and political science, and related world institutions like the World Bank and IMF have been influencing, substantially, how the global economy is managed. Unfortunately, many honest economists have stated that economics and economists do not understand the human development process and how the economy works (DeFleur, et al., 1977). Let us illustrate how the economists and the World Bank and IMF have been mismanaging the global economies because they use wrong intellectual premises.

All economists are Marxian (Galbraith, 1967). That is, all economists believe that capital investment is the solution to all problems – once capital is invested, growth ensues. In a society where capital is seen as the most important factor of production, planning is synonymous with effort towards making capital available. Economists are wrong. Mere capital investments do not promote Sustainable Economic Growth and industrialisation (SEGI).

The Harrod-Domar Model (HDM), the most popular economic model used by economists assumes that employment (labour) is not needed in the production process or that only one input, capital, is limiting in the production process (Glahe, 1977). How can economists solve unemployment problem when they cannot stimulate; yet believe that employment is not necessary in the production process? So, as long as economists continue to manage the economies of the world, global unemployment will remain high and the global youth unemployment would only worsen. Again, to all economists, employment is a cost-item in the production process. Since economists do not understand the growth process, they cannot accept that employment has benefits for the employer and the economy. The employer only pays the employee only a part of the value the employee creates in the organisation where he works. Hence employment has benefits for the employer, the employee and the nation.

History shows that all Western and Asian nations were poor before they achieved the modern Industrial Revolution (IR). They experienced mass unemployment for many centuries. Britain achieved the first modern IR in the period 1770-1850 (Gregg, 1971). When Britain achieved the IR, the adult males and females in the nation were not enough to fill the available job openings. Employers of labour had to resort to employing children to work for many hours in the day. That was the basis of the scandalous child-labour in Britain during the early times of the European industrialisation. History, therefore, demonstrates that rapid economic growth and industrialisation are the solutions to mass unemployment and poverty. The global economy is facing mass unemployment because it is stagnating.

Industrialisation is a learning and capability-building process. Learning – education and training, transforms the individual and nation from an undesirable status into a desirable status (Ogbimi, 1995). This explains why learning increases the knowledge, skills and competence – the ability to solve problems, and lead to industrialisation. The learning-people are Appreciating Assets (AAs), because their intrinsic values increase in a compound fashion with learning intensity and time, and as they are used in the working place. On the other hand, all capital assets are Depreciating Assets (DAs) because their intrinsic values decrease with use and aging.

A nation which emphasises capital investments invests on decreasing investment functions, whereas a nation which emphasises education and training invests on increasing investment functions. The AAs are the strategic resources of a nation. The learning-people (AAs) are the primary source of sustainable growth and industrialisation. The difference between nations is a matter of development of the people, not gross population, not the complex infrastructure erected. Britain achieved the first modern Industrial Revolution because it was the first nation to be ready scientifically and technologically. America and other European nations followed when they were scientifically ready too. Japan followed and then China the economic bride of today. The World Bank and IMF did not exist yet.

Quantification of our learning theory showed that the five learning-related variables that determine the level of industrialisation and should guide planning for industrialisation are: 1) N – the number of people involved in productive work or employment in a nation; 2) M – the level of education/training of those involved in productive activities in the economy and of the people of the nation; 3) L – the linkages among the knowledge, skills, competences and sectors of an economy; 4) R – the learning rates or intensity in the economy and especially among the workforce; and 5) N – the experience of the workforce and the learning history of the society. The higher are the values of the variables, the better is the economy. A healthy economy employs a large number of people. A nation achieves Industrial Revolution when the five learning-related variables attain critical values.

Our scientific theory of employment shows clearly that employment in quantity and quality, is the blood of an economy. The healthy economy may be likened to a well inflated football; they both bounce. Whereas the well inflated football is filled with high-pressured gas, the healthy economy is filled with many millions of highly knowledgeable and skilled work force. Any economy is characterised by one of three principal statuses.

The statuses are: I: co-existent low employment (mass unemployment), low productivity and high inflation; II: co-existent optimal employment (low unemployment), optimal productivity and minimal inflation; and III: co-existent full employment, low productivity and high inflation. Position I is the situation in Nigeria and other developing nations; it is the worst situation. Position II is the most desirable one while position III is theoretical. Transforming an economy from the undesirable status – position I, to the most desirable status – position II, is a fundamental change – industrialisation.

Economists promote unemployment and poverty because they do not understand the science of the development process. It is to more learning – more education and curriculum-based training and full employment policy that the industrialised and non-industrialised nations must turn, to increase the values of the learning-related variables: N, M, L, r and n that promote and determine the level of industrialisation for a nation. This is the solution to the global mass unemployment, including youth unemployment. This is what the UN must urge nations to do.

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