Today, as is the tradition on the first Friday of the month, the US Bureau of Labour Statistics releases the Non-Farm Payroll, an indicator of the monthly change in the employment excluding the farm sector.
The Non- Farm payroll is probably the most important economic indicator after the GDP monthly release, it gives an idea whether the economy is growing or not. IF the economy is growing more jobs will be created and if it is not jobs will be lost or at least no new ones will come on line.
Today expectations for an announcement of 232,000 new jobs were created in October.
The European Union has a similar key indicator as do the UK and Germany.
The economy is not there for its own sake but to serve the people. Keeping people in employment is the sign of a good economy and bodes well for future national stability. The trick is how to create jobs, especially private sector jobs to keep the economy ticking so new jobs can be created … a virtuous cycle.
It’s obvious. When people are engaged in economic activity they have little time for rabble rousing and venting whatever grievances they have in a way that is disruptive.
Which brings us around to the events in Bukina Faso. Last week’s revolt was triggered by ex-President Blaise Campore’s attempt to extend his term in office beyond the constitutional mandate. It was reported that youth fearing that national assembly was about to rub stamp a constitutional amendment to that effect burnt down the parliament and the rest is history.
Doesn’t it make you wonder who these youth were? How did they get mobilised so quickly (Revolutions are never spontaneous regardless of what their pro0moters say)?
"It is safe to say that revolutions occur during times of economic stress. Either the economy is not working at all or is not ticking along at a pace the population is used to...
A cursory glance at the economy of Bukina Faso shows where the problem could lie. It has a GDP of $13b and for a 16m economy comes down to about $800 per capita. But more worrying than that low number is the country’s Human Development Index (HDI), which measures the extent to which social services are being delivered to the people. The country was fourth from the bottom in the world.
Seven in every ten export dollars come from gold and cotton whose prices fluctuate wildly on international markets. Remittances from Bukinabe abroad used to be a useful cushion but since neighbouring Ivory Coast got embroiled in a civil war these have fallen from a quarter of GDP to about one percent, as emigrant workers have returned home.
This bleak picture is a useful addition beyond Campore’s attempted machinations in explaining the country’s implosion.
To quote Bill Clinton’s 1992 US campaign slogan, “It’s the economy stupid”.
To prevent destructive revolution the economy has to work and not only on paper. Improvements in national statistics have to register in the people’s daily lives and there has to be constant improvement in this respect. A tall order for any government.
To make the economy work the government has to concentrate on improving the environment for businesses not only to survive but to thrive. This means ensuring national stability and security, building physical infrastructure, improving health and education services.
Easier said than done. Politics often gets in the way of this simple but easy formula the end result being that even if the economy is cruising along at a prodigious speed, the benefits are being enjoyed by a small minority.
However an improved economy is no guarantee for political longevity.
This week the Republican Party took back the US Senate from the Democratic Party to control both houses of the US legislature, a situation that can make for an uncomfortable last two years of President Barack Obama’s administration. This despite recent findings that show that US economy under Obama has put on 4.5 million jobs more than the Ronald Reagan era yet he has two more years to go.