AN ANALYSIS OF THE RELATIONSHIP BETWEEN UNEMPLOYMENT AND POVERTY IN CAMEROON

CHAPTER ONE

INTRODUCTION

1.1 Background of the study

The reduction of unemployment and poverty has become a significant challenge for the global economy, especially in developing countries. The World Poverty Commission observed that unemployment is strongly correlated with poverty (Abiola et al., 2019). Iyoko (2017) noted that the primary cause of poverty is the lack of sufficient money, regardless of the many classifications of poverty. In 2017, over 6 percent of the global population was unemployed, while almost 776 million individuals were classified as working poor, according to the International Labour Organisation (ILO, 2017).

Cameroon entered the twenty-first century facing the dual challenges of unemployment and poverty. Prior research conducted by Gelbach et al. (2017), Desai (2016), Christiansen et al. (2002), Bigsten (2014), International Monetary Fund_IMF (2014), and Sembene (2015) examined these two development challenges independently. However, there are compelling analytical findings that suggest these two issues are more interconnected than they initially seem. The unemployment problem and poverty can be seen as interconnected, with one being the consequence of the other. Considering unemployment and poverty as closely related implies that addressing one can have a significant impact on resolving the other.

Poverty exhibits multiple dimensions. Poverty is typically characterised by insufficient income to afford basic necessities like food, clothing, and shelter. It also involves limited access to essential utilities and services, environmental challenges, inadequate infrastructure, illiteracy, ignorance, insecurity, low per capita consumption, and poor health. This elucidates why policymakers have regarded the eradication of poverty as the paramount objective for human well-being, as it ensures the elimination of hunger, eradication of diseases, and supply of a prosperous lifestyle. Ajakaiye et al. (2020) propose that poverty can be understood as a result of factors such as education, health, child mortality, and other demographic characteristics. According to them, poverty is defined as the lack of sufficient income to meet these criteria. This concept is applicable to the specific form of poverty known as income poverty and income deprivation. Nevertheless, its weakness lies in the fact that poverty is not solely determined by income deprivation. Furthermore, Ajakaiye et al. (2020) also highlight the deprivation of participating in many society activities such as associations, membership in organisations, access to certain places, profession choices, spouse choices, village meetings, and more.

According to the World Bank's study from 2017, over 2.8 billion individuals worldwide live on an income of less than $2 per day, while 1.4 billion live on less than $1 per day. According to a report from the United Nations Children's Fund (2017), the number of people living in poverty is much higher than what the World Bank estimates. The report suggests that approximately 4.3 billion people, which is 59 percent of the world's population, are living in poverty. Additionally, it states that half of the world's children, around 1.1 billion, are also living in poverty. Additionally, it is worth mentioning that Sub-Saharan Africa, where Cameroon is situated, has the highest prevalence of poverty. According to the United Nations Development Programme (2018), approximately 48.5% of the population lives on less than $1.25 per day, while 69.9% lives on less than $2.00 per day. The region is home to little more than 988 million individuals, of whom approximately 691 million Africans live below the poverty line, defined as having a daily income of less than $2.00. The United Nations Development Programme (2019) reported that the rural population in Sub Saharan Africa in 2015 was 623 million. Approximately 85.8% of impoverished individuals in the region reside in rural areas (Alkire et al., 2022). In the global context, the proportion of poverty that is concentrated in rural areas is notably elevated in Sub-Saharan Africa and South Asia, reaching as high as 86%. In Sub-Saharan Africa, Burundi and Madagascar exhibit the most pronounced disparities between rural and urban areas in terms of poverty, with rural populations accounting for around 95% of the impoverished (Alkire et al., 2022). 

Unemployment is a crucial factor in determining poverty, as it directly impacts persons' capacity to generate revenue and maintain their means of living. Cameroon's labour market exhibits a substantial disparity between the skillsets possessed by the workforce and the requirements of the economy. A significant number of Cameroonians, particularly the younger generation, are involved in informal employment, which is frequently marked by meagre salaries, job instability, and bad working conditions. Informal employment perpetuates a cycle of poverty, as individuals are unable to generate adequate revenue to fulfil their fundamental requirements and make investments for their future (Nyong, 2020). The elevated unemployment rate in Cameroon can be ascribed to multiple factors, such as swift population expansion, insufficient educational and vocational training institutions, and a sluggish private sector that inadequately generates work possibilities. The government has endeavoured to tackle these difficulties through a range of initiatives, including the establishment of the National Employment Fund (NEF) and the implementation of vocational training programs. Nevertheless, these endeavours have achieved only modest results in diminishing the rates of unemployment and poverty (Fonchingong et al., 2018).

The poverty in Cameroon is characterised by multiple dimensions, including not just a lack of cash but also limited access to vital services such as healthcare, education, and clean water. Rural communities, specifically, experience a disproportionate impact from poverty, as they have limited access to infrastructure and essential services. Households led by individuals with poor educational attainment and involved in subsistence agriculture have a greater incidence of poverty (Tchamba, 2020). The correlation between unemployment and poverty in Cameroon is exacerbated by the existence of socio-political elements, such as corruption and governance concerns, that impede the successful execution of policies and limit economic progress. The government's ability to effectively tackle unemployment and poverty is frequently hindered by these systemic obstacles, resulting in an enduring cycle of poverty (Mbaku, 2018).

The correlation between unemployment and poverty in Cameroon is intricate and diverse, shaped by numerous socio-economic, political, and institutional factors. Although the government has taken steps to tackle these difficulties, it is necessary to implement more extensive and well-coordinated strategies in order to effectively decrease unemployment and poverty rates. This study aims to provide a comprehensive analysis of the variables that contribute to the high levels of unemployment and poverty in Cameroon. It will also provide recommendations on how to effectively address and reduce unemployment and poverty in the country.

1.2 Statement of the problem

Unemployment and poverty are closely intertwined socio-economic issues that have endured in Cameroon for a considerable period of time. Despite the government and foreign organisations making numerous attempts to alleviate poverty and stimulate economic growth, a substantial segment of the population still resides below the poverty threshold. Based on data from the National Institute of Statistics, the poverty rate in Cameroon stood at around 37.5% in 2021, with rural areas seeing a disproportionate impact (INS, 2021). Unemployment, especially among young people, significantly contributes to the ongoing poverty by restricting individuals' capacity to create revenue, obtain sustainable livelihoods, and enhance their standard of living.

The correlation between unemployment and poverty is intricate and diverse. Unemployment results in both a direct decrease in income for individuals and households and also contributes to several adverse socio-economic consequences, such as food insecurity, inadequate health, and limited access to education and critical services (Ngepah, 2017). The dearth of job prospects in Cameroon has ensnared some individuals, particularly the younger generation, in an inescapable cycle of destitution. The elevated national unemployment rate of 3.9% in 2021, coupled with even higher rates among some demographic groups, intensifies this cycle by impeding individuals without employment from fulfilling their fundamental necessities and pursuing future prospects (INS, 2021).

Additionally, the informal sector, which acts as a support system for numerous jobless individuals, frequently lacks the ability to offer consistent and enough earnings, thereby reinforcing poverty. Although the informal sector in Cameroon employs a significant fraction of the workforce, the employment opportunities it provides are generally characterised by low wages, instability, and a lack of social security measures (Fonjong, 2017). Consequently, a significant number of individuals employed in the informal sector continue to be at risk of poverty, lacking the ability to amass wealth or enhance their quality of life. The situation is most grave in rural areas, where there is limited access to formal work options. The bulk of the population in these areas depends on subsistence agriculture and other informal enterprises for their existence (Njong & Ningaye, 2008).

Although the connection between unemployment and poverty is evident, there has been a scarcity of research on the interplay between these two concerns in the context of Cameroon. Prior research has predominantly examined unemployment and poverty as separate phenomena, neglecting to investigate the cause-and-effect link between them (Adepoju, 2016). Gaining a comprehensive understanding of this correlation is essential for developing efficient strategies that effectively tackle both issues at the same time. In the absence of focused initiatives that take into account the relationship between unemployment and poverty, attempts to alleviate poverty may be hindered by the continued presence of elevated unemployment rates, and vice versa.

Policymakers in Cameroon face a problem due to the insufficient availability of detailed data and analysis regarding the correlation between unemployment and poverty. Existing policies frequently neglect to tackle the underlying factors contributing to unemployment and poverty, instead prioritising temporary remedies that do not lead to long-lasting enhancements in individuals' well-being (Ngepah, 2017). The lack of comprehension in this area has resulted in the implementation of initiatives that are not adequately customised to the distinct requirements and situations of the most susceptible groups, leading to limited efficacy in alleviating poverty and unemployment. This study attempts to provide a comprehensive investigation of the correlation between unemployment and poverty in Cameroon, considering the existing challenges.

1.3 Objectives of the study

The primary objective of this study is to critically Analyze the Relationship Between Unemployment and Poverty in Cameroon. Specific objectives of this study are to:

To explore the relationship between unemployment and poverty rates in Cameroon

To assess the impact of unemployment on household income in Cameroon

To assess the impact of unemployment on household consumption pattern in Cameroon

To identify the socioeconomic implications of long term unemployment in Cameroon

1.4 Research Questions

The following research questions which are in line with the objectives of this study will be answered in this study:

What is the relationship between unemployment and poverty rates in Cameroon? 

What is the impact of unemployment on household income in Cameroon?

What is the impact of unemployment on household consumption pattern in Cameroon?

What are the socioeconomic implications of long term unemployment in Cameroon?

1.5 Research Hypotheses

To determine the effectiveness of this study, the following research null hypotheses will be formulated to guide the study and it will be tested at 0.05% levels of significance.:

Ho:  There is no significant relationship between unemployment and poverty rates in Cameroon.

Ha: There is a significant relationship between unemployment and poverty rates in Cameroon.

1.6 Significance of the study

Gaining insight into the correlation between unemployment and poverty in Cameroon is essential for tackling socio-economic difficulties and devising efficient solutions. The significance of this study extends across multiple domains, encompassing economic development, social stability, and policy formulation. The study will serve as a comprehensive repository of information for governments, communities, the general public, scholars, and academics.

Unemployment and poverty are intricately connected; as high levels of unemployment frequently worsen poverty. The study aims to elucidate the correlation between unemployment and economic adversity, as well as to discern distinct patterns and causal elements in Cameroon. Having this comprehension is crucial for formulating precise economic strategies that effectively tackle both problems at the same time. Effectively tackling unemployment can boost economic productivity and alleviate poverty. Furthermore, the study will aid in the efficient allocation of resources to areas that will provide the greatest influence on economic growth and the alleviation of poverty.

Furthermore, the results of the study might provide valuable guidance to policymakers in formulating and executing policies that efficiently address the issues of unemployment and poverty. Comprehending the correlation between these variables enables the development of comprehensive strategies that tackle the underlying factors of poverty while simultaneously fostering the generation of employment opportunities. Policymakers can develop focused interventions, such as job training programs, employment creation initiatives, and social safety nets, to alleviate the impact of unemployment on poverty levels, now that they have a better comprehension of how unemployment affects poverty. 

Furthermore, unemployment frequently results in heightened poverty, which can worsen social disparity and instability. The study aims to offer a comprehensive understanding of the relationship between unemployment and social inequities, and propose strategies to foster social equity and cohesiveness. Poverty has a significant influence on multiple facets of life, encompassing health, education, and overall welfare. The study aims to find measures that can be used to increase living conditions and improve the overall quality of life for persons and communities impacted by the issue.

Moreover, this study can function as a standard for forthcoming research on unemployment and poverty. It can offer significant information and perspectives for tracking patterns over time, assessing the efficiency of policies, and adjusting tactics to accommodate shifting economic circumstances. The study aims to fill gaps in current research and offer fresh perspectives on the interconnections of these topics within the context of Cameroon. This can facilitate subsequent research and foster a more profound comprehension of the socio-economic terrain.

1.7 Scope of the study

Broadly, this study focus is to critically Analyze the Relationship Between Unemployment and Poverty in Cameroon. Empirically, the study will discuss the link between unemployment and poverty rates in Cameroon, the impact of unemployment on household income in Cameroon, he impacts of unemployment on household consumption pattern in Cameroon and the socioeconomic implications of long term unemployment in Cameroon. 

 Geographically, the study will be carried out in Beau, Cameroon. 

1.8 Limitations of the study

During the examination, the researchers observed intrinsic constraints that exist in all human behaviours. The primary constraint was the dearth of comprehensive literature on the topic, stemming from the paucity of data on an analysis of the relationship between unemployment and poverty in Cameroon. Hence, a substantial investment of time and effort was required to ascertain the suitable materials, books, or information and collect data. 

Moreover, this study is limited by its limited sample size and restricted geographical coverage, primarily centred on Cameroon. Hence, the applicability of the results obtained in this study is limited, emphasizing the necessity for additional research. 

Furthermore, the researcher's shortcomings were predominantly attributed to financial restraints, as they are a student with inadequate financial resources to support themselves. The excessively high transportation fees at the research site presented a difficulty in fulfilling the financial responsibilities associated with transportation costs.

In addition, the researcher encountered a time limitation as a result of the necessity to do this research while concurrently meeting the responsibilities of attending lectures and engaging in other educational endeavors.

1.9 Definition of terms

Unemployment: Unemployment is a term referring to individuals who are employable and actively seeking a job but are unable to find a job. Included in this group are those people in the workforce who are working but do not have an appropriate job.

Unemployment rate: The unemployment rate is the percentage of people in the labor force who are unemployed. Consequently, measuring the unemployment rate requires identifying who is in the labor force. The labor force includes people who are either employed or unemployed.

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