Namibia’s 2023 Labour Force Survey highlights unemployment challenges and income disparities

Helena Mboti and Cheryl Emvula

* Only 46.2% of the working-age population (1.88 million people) are active in the labour market, with a notable gender disparity of 51.1% of men versus 41.9% of women. • Using the 2023 definition, the unemployment rate is 36.9% but would rise to 54.8% under the broader 2018 definition, indicating significant underemployment and discouraged workers.

* According to the survey, 41.9% of youth (15-24 years) are not in education, employment, or training, contributing to a high level of discouraged workers, particularly in rural areas (59.5%).

* More than half (55.4%) of employed Namibians earn less than N$5,000 per month, with only 2.6% earning over N$40,000, reflecting a significant income gap in the labour market.

Methodology

The 2023 Labour Force Report conducted by the National Statistics Agency (NSA) was released on 29 January 2025.
The report primarily focused on capturing employment and unemployment statistics, excluding a detailed inquiry into informal employment, working conditions, hours worked, or job types.

The categorisation of respondents included the employed and unemployed populations to account for those actively contributing to the labour market and those willing to participate based on a specific reference period.

The primary limitation of the 2023 survey data stems from its strict definition of unemployment, which excludes discouraged workers—those who may want to work but have stopped actively seeking employment due to barriers such as skill mismatches or repeated rejections or who looked for work outside of the specific reference period.

Additionally, the survey did not capture informal employment or working conditions, which are key factors that could significantly impact the overall employment picture, particularly since informal employment patterns are perceived to be on the rise in urban areas.
As a result, Namibia’s labour force has decreased by 222,906 labourers since 2018.

These limitations make a direct comparison with the 2018 labour statistics challenging; however, the analysis will offer a view of the current state of Namibia’s labour market as reflected in the 2023 data.

Labour market overview

Namibia’s labour market remains under significant strain, exacerbated by the country’s growing population, which reached 3,022,401 in 2023.
While the working-age population is substantial (1.88 million people or 62% of the general population), only 46.2% are active participants in the labour market.
This low participation rate points to a significant underutilisation of the available labour force, particularly in rural areas where participation rates are notably lower (33.4%).

Moreover, the youth population represents a large share of the inactive labour force, with 41.9% of individuals aged 15-24 neither employed, in education, or receiving training (NEET).

This group, compounded by discouraged workers, presents a serious challenge to future economic stability and growth as it increases the working-age population’s burden.

Labour force participation

Namibia’s overall labour force participation rate for 2023 stands at 46.2%, which is relatively low compared to international standards, where healthy economies typically see participation rates of between 60% and 70%. s show significantly lower participation at 33%.

This gap highlights ongoing challenges related to urbanisation and limited access to formal employment in rural areas, with rural-to-urban migration for job opportunities likely playing a role in higher urban participation.

The 2023 data reveals a notable gender gap in labour force participation. While females make up 50.4% of the population, their participation rate is 41.9%, compared to 51.1% for males.

Individuals aged 25-49 represented the most significant portion (87.6%) of the labour force, of which 66.8% were below 40. Labour absorption rate The employment-to-population ratio (EPR) in Namibia is just 29.1%, meaning less than a third of the population is employed.

This low EPR places a heavy tax burden on the existing tax base as a smaller number of taxpayers must support the social services costs for a larger population. According to Cirrus Capital, less than 3.8% of Namibia’s population (115,000 people) represents the taxpayer base.

Similarly, the age dependency ratio, now at 78 dependents per 100 working-age individuals, rose from 71 dependents per 100 working-age individuals in 2018 despite the narrower definition of the working-age population.

The highest EPR is found in Kharas at 44.5%, while the lowest is in Ohangwena at 11.7%.

These regional disparities point to significant structural imbalances in the labour market and emphasise the lack of employment opportunities outside urban centres or resource-rich areas.

Working Age Population

Labour Force Participation Rate Labour Force Absorption Rate 3 Namibia Labour Force Survey Occupational employment trends Namibia’s labour market strongly relies on wage employment, with 84.7% of the employed population classified as employees.

In contrast, only 9.2% of workers are own-account workers, and 2.8% are employers with hired employees, reflecting a relatively low level of entrepreneurship and self-employment opportunities.

The increase in Namibia’s graduates is not translating into higher income growth.

Income distribution further highlights inequality, as 55.4% of employed individuals earn less than N$5,000 gross monthly income.

Conversely, only 2.6% of the workforce earns more than N$40,000 per month, underscoring a significant income gap within the labour market.

These figures suggest that much of the workforce is employed in low-wage jobs, perpetuating social risks in an elevated inflationary environment and percentage distribution of the employed population by gross monthly income/ salary.

From a sectoral perspective, Namibia’s economy remains heavily dependent on agriculture (16.1%) and wholesale and retail trade (10.0%).

The manufacturing sector follows closely at 9.8%, while administrative support accounts for 9.3% of employment. However, these sectors are primarily composed of lower-skilled positions, contributing to the low pay and highlighting the challenges of moving towards higher-value employment in the economy.
Labour productivity rates While there has been progress in education, with 36.6% of the population having completed at least secondary education in 2023 (up from 26.3% in 2011), the labour market still reflects a significant gap between education levels and the available job opportunities.

Despite 76.7% of employed individuals holding at least a secondary school qualification, a large portion of the workforce is concentrated in lower-skill occupations. According to the survey, 40.2% of workers are employed in roles requiring secondary-level education or less, of which 13.4% work in service occupations, and 46.9% are in elementary occupations, craft and trade work, or service and sales positions.

These types of roles typically offer lower wages and skill requirements.

In contrast, only 30.3% of workers are employed in higher-skilled positions, such as professionals, managers, technicians, or associate professionals.
This disparity between educational attainment and job opportunities that match those qualifications highlights a misalignment in the labour market, leading to worker discouragement and hindering overall economic productivity.

Unemployment trends

Unemployment in Namibia, defined in 2023, stands at 36.9%, based on a narrower definition that includes only those actively seeking and available for work within a specified reference period.

In contrast, using the broader definition from 2018, which also accounts for discouraged workers, the unemployment rate rises significantly to 54.8%, one of the highest in the world. Under the 2023 definition, unemployment has increased dramatically, from 19.8% to 36.9%.

The disparity between narrow and broad definitions highlights the extent of underemployment, as discouraged workers are excluded from the official count.

Regardless of the measure, the rise in unemployment is concerning. The issues proved systemic, with rural areas (38.0%) experiencing only slightly higher unemployment than urban areas (36.4%). Notably, Kavango East and West have the highest unemployment rates, surpassing 52%, signalling regional economic distress and skewed employment opportunities.

Youth unemployment, Youth unemployment statistics are particularly alarming.

According to the NSA, only 24.3% (455,030) of the working-age population is estimated to be part of the youth labour force.

Within the labour force, 24.8% of youth are employed, and 19.8% are unemployed. The NSA also reported that 53.8% of the working-age population (1,008,875) are not seeking jobs.

This suggests that many Namibian youth are discouraged by the system and have effectively withdrawn from the labour force.

A significant portion of the youth is inactive, with 41.9% of individuals aged 15-24 neither employed, in education, or receiving training (NEET).
Combined with the high percentage of people in the potential labour force (53.6%), this points to a concerning trend, especially considering that youth comprise 71.1% of the population.

Survey respondents cited taking care of family or home (44.8%), studying (27.9%), and other reasons (9.9%) as the main factors for not seeking employment.
However, given the limitations of the data and the low-income prospects in the job market, most youth in the potential labour force likely view the opportunity cost of formal employment as too high.

Consequently, informal employment may seem more viable, given the low chances of securing a well-paying formal job.
With high levels of unemployment, particularly among the youth, and a large proportion of discouraged workers in general, the country faces significant challenges in achieving inclusive and sustainable long-term economic growth.

While sectors like agriculture and services remain major employers, job quality is poor, and key industries, including agriculture, suffer from adverse economic conditions.

Without targeted interventions to stimulate job creation, address regional disparities, and better align skills with market demands, Namibia’s labour market risks becoming a driver of social instability and economic stagnation.

Helena Mboti and Cheryl Emvula are FNB Namibia Economists