Despite a surge in hiring by companies within the oil, services, and construction industries, Guyana still grapples with a 25% youth unemployment rate. This was outlined in the International Monetary Fund’s (IMF) December 2023 report on Guyana. The financial institution said the overall unemployment rate stands at 12.5%, signaling lingering slack in the labor market.
Notably, the Inter-American Development Bank (IDB), in a recent report credited Guyana’s booming oil and gas sector as one of the main drivers of the decline in unemployment that was recorded in previous years.
However, IMF’s findings indicate substantial negative output gaps in both 2022 and 2023, prompting a call for structural reforms. These include diversification efforts, improved infrastructure, expansion of the energy sector, a more favorable business environment, and ongoing economic diversification.
Addressing the challenge of labour shortages, the report suggests that the Government of Guyana (GoG) implement structural reforms including diversifying the economy and to support inclusive growth. The IMF also suggested measures targeting labour shortages and skill mismatches through training, creating incentives to set up business outside the capital, and targeted immigration of skilled labour unavailable domestically among others.
In its response to the IMF’s observation in this regard, the government stressed that it is working actively to improve efficiency and reduce mismatches in the labour market. The government underscored that it recognizes the importance of an efficient and responsive labour market given the scale and pace of the economic expansion and structural changes occurring in the economy.
Moreover, the government highlighted its investment in human capital development, including through providing basic facilities for vocational training, and the provision of resources for online training through scholarships aimed at enhancing skillsets and boost employability among the Guyanese population.
Another initiative government highlighted was its part-time jobs programme, aimed at swiftly generating income, aligning with the government’s ambitious goal of creating 50,000 jobs by 2025.
To this end, it was stated that work has begun with the support of an expert to gather critical data to inform strategic interventions aimed at addressing labor market mismatches in Guyana.
