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Jamaica’s economic growth has been anaemic for decades barely able to go beyond two per cent a year.

A few years ago, Government and private sector leaders proclaimed Jamaica would attain five per cent growth in four years. The country didn’t get close to half that target.

In his State of the Nation address in the Senate last Friday (January 24), Opposition Senator Peter Bunting made both a practical and scholarly case for why greater emphasis must be placed on productivity if Jamaicans are to enjoy economic growth.

Below is his presentation on the matter: 

One may wonder why the Leader of the Opposition in assigning me a shadow portfolio coupling citizen security with productivity (which is the key to growth).

Various studies and surveys have identified the top three obstacles to competitiveness or productivity as crime, corruption, and the burden of government (tax rates and bureaucratic inefficiency.

Many developing countries have transformed their productivity, economic growth rates and development prospects over the last three decades. The BRICS economies now contribute about 35 per cent of world GDP, more than the 30 per cent contributed by the G7 countries (measured at purchasing power parity).

If the current trend continues, by 2030 over 50 per cent world GDP will be generated in countries recently classed as developing.

However, this shift has left Jamaica behind. For various reasons, one being corruption, Jamaica has not yet been able to achieve or sustain high growth rates. Bold and decisive action is required if Jamaica is going to break out of the low-productivity, low-growth trap.

One important part of this strategy is to produce graduates of tertiary institutions that can increase the productivity and competitiveness of businesses and create new enterprises through greater entrepreneurship. At present, 70 per cent of Jamaica’s workforce has had little formal training or certification, which is reflected in our low productivity. We need to develop a trained, skilled workforce, certified to international standards, which will help to stimulate investment and employment and increase national productivity.

That is why the Opposition has proposed to repurpose HEART/NSTA Trust as an institution that funds training and upskilling of the workforce. Matching the expenditure of private employers in this area dollar for dollar.

However, any investment in education, training and research capacity must have a clear strategic focus if it is to have the necessary transformative effect. There is little point, for example, in training graduates to work in dying industries. One such example of a dying industry is:

The bauxite alumina industry is in secular decline and Jamaica should be planning an exit with the least damage to the country’s finances and to the environment. We should learn from earlier examples of the sugar and banana industries where we were reluctant to accept those industries’ inevitable demise. The situation in this bauxite alumina sector is so humiliating that questions I asked in December 2023 took almost a year to receive a response from this government and are still not fully answered.

What we do know is that one operator – Discovery Bauxite Operations Ltd. (DBOL) owed US$7 million to Petrojam Ltd. at the time I asked the question, and owed millions more to mining and haulage contractors, and other suppliers. The only skin in the game is from the Government and people of Jamaica and we’re seeing nothing but financial and environmental liabilities in return.

DBOL paid nothing for profit sharing, tax, or royalties for 2021, 2022, or 2023. Even the asset user fee which seemed to be the only guaranteed payment to JBM, is in almost two years’ arrears with an unpaid balance of US$2.7 million. And this was predictable!

Go back to the Hansard when this arrangement was being proposed in the lower house. The record will show that I (and others) predicted this dreadful outcome. Those who negotiated it are guilty of either gross stupidity or corruption.

To appreciate the damage this dying industry is still inflicting, one has only to drive through some areas of South Manchester and SW St. Ann to view the post-apocalyptic landscape of mined-out pits left without rehabilitation. Or go to Ewarton and see the semi-derelict processing plant, regularly spewing toxic effluent into the Rio Cobre, contaminating our environment.

So what is Jamaica gaining from this dying extractive industry? In 2023/24 we got ZERO from the income and profits tax from the bauxite/alumina companies, year to date 24/25 also ZERO. Last year we were getting less than US$1 million per month from the bauxite levy, and this year to date we’re getting… ZERO nothing from the bauxite levy.

The little insecure employment that Jamaica gets from this industry is not worth the environmental liabilities we’re leaving for our grandchildren to pay.

And this is the same entity now being allowed into the cockpit country to destroy one of our most valuable and sensitive ecological areas!! This is madness. Future generations will curse us.

On the other hand, it is essential to increase the supply of trained, skilled labour in the ‘sunrise’ business areas that could transform productivity and prospects. It is therefore essential to develop clear strategic visions of where the growth opportunities will be in future, and action plans to steer economies to the desired future. Two sectors are at a crossroads between maturity and decline on the one hand, or a new sunrise on the other. These are the BPO and tourism sectors.

Reform of tertiary education and the SLB

Recent tracer studies suggest that around half of undergraduates and postgraduates who had found employment were working in jobs that were not related or only partially related to their discipline, and that significant majorities were dissatisfied with their salaries, benefits, job security and opportunities for advancement.

This suggests a growing mismatch between the skill sets acquired at university and the market demands for those skills.

A university degree used to be the route to a well-paid job, but many university students today owe substantially more than the initial amount of their student loan five-10 years after graduation because their salaries were too low to repay the loan.

This suggests that the educational system itself will have to undergo extensive reform, and that universities will have to adapt quickly if they are to survive.

Conclusion

The findings of STATIN’s Labour Force Survey for October last year are indeed concerning, particularly the statistic that 22.2 per cent of our youth—108,900 individuals—are not engaged in employment, education, or training. This reflects a critical challenge we face as a nation, and it underscores the urgency of addressing the barriers that prevent many young Jamaicans from reaching their potential.

This data points to several underlying issues. First, it highlights the structural and systemic barriers to opportunities, including limited access to quality education and vocational training, as well as a mismatch between the skills young people have and the demands of the labour market. Second, it suggests that economic hardship and social disconnection may be driving many youth away from formal systems of engagement.

When young people are excluded from these avenues, their time is often spent in informal or precarious activities—some may take on irregular work, while others may retreat into idleness, which can lead to feelings of hopelessness. Unfortunately, this disconnection can make them more vulnerable to negative influences, including criminal activities, such as gang involvement. Research has shown that lack of opportunity and social mobility often drives disenfranchised youth into such pathways, as they seek a sense of belonging and purpose.

To address this, we need a multi-faceted approach. This includes expanding access to skills training and apprenticeship programs, fostering greater alignment between the education system and market needs, and investing in social interventions that provide mentorship, psychosocial support, and alternative pathways to success. Additionally, strengthening community-based programs and creating safe spaces where youth can engage in productive activities is vital.

This statistic must be seen as a call to action for all stakeholders— government, private sector, civil society, and communities. Jamaica’s youth are a powerful resource, and it is our collective responsibility to ensure that they have the tools, opportunities, and support to contribute meaningfully to our society.