Ghana’s performance in the World Bank’s B-READY indicators has highlighted serious challenges in creating an enabling environment for private sector investment, according to the World Bank’s latest findings. The report reveals that the country’s scores in key areas remain low, signaling structural obstacles that could hinder economic growth and development.
Specifically, Ghana scored 32 in Market Competition, 41 in Business Entry, and 55 in Dispute Resolution, indicating gaps in fostering a competitive market, facilitating the smooth entry of businesses, and providing efficient mechanisms for resolving commercial disputes. These scores suggest that potential investors may encounter significant barriers, ranging from bureaucratic hurdles to legal uncertainties, when attempting to establish or expand operations in the country.
The 2025 Economic Update by the Bretton Woods Institution underscores a critical concern: the growing mismatch between rising educational attainment and the availability of high-quality jobs. The report highlights that, although more Ghanaians are obtaining higher levels of education, the labor market is not expanding at the same pace to absorb these skilled individuals. This has resulted in declining probabilities of securing meaningful employment at all levels of education.
“A rapid increase in the number of workers with higher levels of education—without a corresponding rise in high-quality jobs—may be driving down the returns to education. At the same time, low education quality, as measured by Ghana’s underperformance on standardized test scores, could also be a significant factor,” the report states.
The World Bank report further reveals that Ghana’s labor market is not generating enough employment opportunities to match the growth of its working-age population. This mismatch is particularly concerning for young people entering the workforce, many of whom report difficulty finding suitable employment upon completing their studies. For a significant number of graduates, the lack of adequate job opportunities has resulted in underemployment or the decision to remain unemployed while searching for better prospects.
Another dimension of the challenge is the significant outmigration of youth, which masks the true extent of domestic job shortages. The report estimates that approximately one million young Ghanaians currently live abroad, seeking opportunities that are unavailable at home. This migration reflects both the aspirations of youth for higher-quality employment and the structural inadequacies of the domestic labor market.
The World Bank also drew attention to weak labor demand in productive sectors, which has hampered sustainable employment growth. Between 2012 and 2023, self-employment accounted for roughly twice as many wage jobs created outside the agricultural sector, highlighting the limited capacity of formal sectors to absorb workers.
The report points out that some of the sectors with the highest potential to generate waged employment for medium-skilled workers—such as manufacturing, construction, and domestic services—are among the slowest-growing segments of Ghana’s economy. This slow growth in productive sectors limits opportunities for stable and high-quality employment, contributing to the broader structural unemployment challenge.
The findings in the Economic Update are intended to serve as a foundation for the forthcoming World Bank Growth and Jobs Report for Ghana, which will offer a more comprehensive analysis of strategies to address these labor market and economic growth challenges. In particular, the report identifies five critical areas that a national growth and employment strategy must address to ensure sustainable economic development, including:
- Expanding the creation of high-quality jobs across diverse sectors.
- Aligning educational outcomes with labor market needs to ensure skill relevance.
- Encouraging private sector investment by reducing regulatory barriers.
- Addressing structural impediments to labor demand in productive sectors.
- Managing youth migration and integrating diaspora skills into the domestic economy.
The World Bank’s assessment underscores the urgency for coordinated policy interventions, improved workforce planning, and targeted private sector development programs. Without decisive action, Ghana risks underutilizing its educated youth, facing persistent unemployment, and limiting its potential for inclusive economic growth.
EASTERN FM 105.1 MHZ will continue to track developments on this report and provide updates on government responses, private sector initiatives, and youth employment programs aimed at addressing the growing labor market challenges in Ghana.
STORY BY KENNEDY AMPONSAH NTI
EASTERN FM 105.1 MHZ
NEWS ROOM
