Monday, June 8, 2009

Unemployment Rate Has Stayed in Double-Digits

Since Rama Sithanen returned as Minister of Finance. This is my conclusion after I looked at the cmphs data from our highly-esteemed CSO and made a few adjustments to the Mauritian Labour Force series so that they make a bit more sense. Here is how and why I modified the data:
  1. I calculated the 2002 data as the 2001 figure plus the increase of the previous year (7,300) because I believe that the people who opted for VRS are likely to return to the labour force
  2. I obtained the 2006 and 2007 figures by adding the average increase for 2004 and 2005 (10,800) to the data for 2005 and 2006. This is more in line with the expected increase of about 10,000 each year (a 0.8% growth rate for a population of about 1.25 million) instead of the increase of 500 for the year 2007. The adjusted data are shown in the chart on the left.
I then added the foreign workers to arrive at a revised number for the total labour force before subtracting the total employment numbers to come up with the adjusted unemployment rate figures.

So what do the new figures look like? Much higher than the official figures (the CSO is also looking into the matter). For instance the rate for 2008 is more like 10.4% instead of 7.2%. We also see that Sithanen's reform has increased the jobless rate from 10.3% to 11.7%.

A couple of years ago Ramgoolam said in parliament that we needed to add 2% to the unemployment rate to get the real unemployment rate. Now it's more like 3%.

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