The towns of developing countries are filled with unemployed youth who have left the family farm but failed to find employment in the industries and institutions of the public and formal sectors. For many young people the informal sector can offer an alternative route through an apprenticeship leading to a career as a self-employed artisan. Beginning in 1971 with a comprehensive survey, the Kwame Nkrumah University of Science and Technology (KNUST), Kumasi, monitored the growth of Ghana’s largest informal industrial area, Suame Magazine. It found that in difficult economic times, when lack of foreign credit severely limited importation, the Magazine grew rapidly and provided work for many otherwise idle hands. Later, when agreements with the IMF and World Bank made available international credit, the informal sector suffered hardship and the rate of growth slowed down.
The survey of 1971 was commissioned by the government of Dr Kofi Busia. It found that the population of the Magazine was made up as follows:
Number of Enterprises (Master craftsmen employers) 1085
Number of Master Craftsmen Employees 530
Number of Apprentices under Training 3870
Total Population 5485
In later years, the population of the Magazine was recorded by the Suame Mechanical Association, a funeral society to which all artisans and apprentices belonged. The reported approximate population at various dates were as follows:
1979 27,000
1984 40,000
1990 45,000
From an analysis of the data it was possible to obtain a relationship between the annual growth of population, the average number of apprentices per employer and the proportion of apprentices succeeding in setting up in self employment at the end of their five-year apprenticeship.
The period from 1971 to 1979 was a good time for Suame Magazine. Very little was being imported into Ghana and there were many opportunities to find ways of making what were known as ‘import substitution products’ and sell them in local markets. The university played a key role in developing new products for local manufacture and training would-be entrepreneurs and their workers in how to produce them. Successful products included soap, caustic soda, paper glue, animal feed, steel nuts and bolts and plant and machinery for the woodworking and food processing industries and rural craft industries.
During these eight years, the total population of Suame Magazine grew at an annual rate of about 22%. About 42% of graduating apprentices were succeeding in setting-up their own workshops and another 21% were staying on to work for their masters as paid master craftsmen. Thus, an estimated 63% of all apprentices were achieving long-term employment. Those failing to find long-term employment, had enjoyed five years of training and left with skills that might be employable elsewhere.
In 1983 the government of Ghana began an Economic Recovery Programme (ERP) supported by the IMF and World Bank which provided credit to finance a flood of cheap goods, imported mostly from China. This was disastrous for local industries. In the two years 1988 and 1989, the Association of Ghana Industries reported losing over one hundred of its formal sector members or about 18% of its total strength. In the informal sector things were much worse with 70% of enterprises in Suame Magazine reporting serious difficulties and the remaining 30% reporting stagnation. By this time only 1 in 400 (0.25%) of graduating apprentices was succeeding in becoming self-employed and many young men could look forward to nothing better than indefinitely prolonged unpaid apprenticeship.
Many Ghanaians felt uneasy about living long-term on credit from overseas. While many past loans have been written off, and individual debts are not taken very seriously, there is no guarantee that a day of reckoning will not come. The study of Suame Magazine from 1971 to 1990 suggests that deprived of the largesse of the IMF and the World Bank, goods in the market might for a time be more expensive, less varied and less glamorously packaged, but many more people would be in work and manufacturing industries would be progressing steadily upwards from the grassroots. In short, a nation would be growing in self-reliance.
