Research Article
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Digitalization and Employment among Small and Medium Enterprises in Ghana

Year 2024, Volume: 2 Issue: 2, 100 - 120, 28.12.2024
https://doi.org/10.5281/zenodo.14562410

Abstract

Purpose – Digitalization is transforming the world of work in significant ways that are yet to be examined. Rapid proliferation of digital technologies is reshaping industries and altering traditional modes of production and service delivery with important implications for employment, particularly among small and medium-sized enterprises that are central to employment generation in developing countries.

Design/data/methodology – Using the latest round of the World Bank Enterprise Survey (2022) on Ghana, this study draws on the theoretical frameworks of labour market matching theory and skill biased technological change to investigate the relationship between digitalization and employment, and the demand for skilled labour among small and medium scale enterprises (SMEs) in Ghana.

Findings – Findings indicate a significant positive relationship between digitalization and employment levels among SMEs in Ghana, while a negative relationship is observed between digitalization and skilled labour.

Originality/value – The study contributes to the literature by emphasizing the potential transformative impact of digitalization in employment generation.

Ethical Statement

Not applicable.

Supporting Institution

No funding was provided in writing this manuscript.

Thanks

Not applicable.

References

  • Aboal, D., Garda, P., Lanzilotta, B., & Perera. M. (2015). Innovation, Firm Size, Technology Intensity, and Employment Generation: Evidence from the Uruguayan Manufacturing Sector. Emerging Markets Finance and Trade, 51(1), 3–26.
  • Arsić, M. (2020). Impact of digitalisation on economic growth, productivity and employment. Economic Themes, 58(4), 431-457. https://doi.org/10.2478/ethemes-2020-0025
  • Arthur, K. K., Bannor, R. K., Masih, J., Oppong-Kyeremeh, H., & Appiahene, P. (2024). Digital Innovations: Implications for African Agribusinesses. Smart Agricultural Technology, 100407.
  • Asravor, R. K., & Sackey, F. G. (2023). Impact of technology on macro-level employment and the workforce: What are the implications for job creation and job destruction in Ghana? Social Indicators Research, 168(1), 207-225. https://doi.org/10.1007/s11205-023-03109-6
  • Atiase, V. Y., Agbanyo, S., Ameh, J. K., Sambian, R. M., & Ganza, P. (2022). Creating value for whom? Digitization and governance practices of nontraditional export firms in Africa. Strategic Change, 31(1), 31-44. https://doi.org/10.1002/jsc.2478
  • Aubert-Tarby, C., Escobar, O. R., & Rayna, T. (2018). The impact of technological change on employment: The case of press digitisation. Technological forecasting and social change, 128, 36-45. https://doi.org/10.1016/j.techfore.2017.10.015
  • Autor, D. (2022). The labor market impacts of technological change: From unbridled enthusiasm to qualified optimism to vast uncertainty (No. w30074). National Bureau of Economic Research. Azar, J., Marinescu, I., & Steinbaum, M. (2022). Labor market concentration. Journal of Human Resources, 57(S), S167-S199.
  • Azu, N. P. (2022). Consequences of Digitalisation in Curbing Female Unemployment in West Africa. Available at SSRN 4571504.
  • Bagnoli, L., & Estache, A. (2022). Mentoring migrants for labor market integration: Policy insights from a survey of mentoring theory and practice. The World Bank Research Observer, 37(1), 39-72. https://doi.org/10.1093/wbro/lkab005
  • Beier, G., Matthess, M., Shuttleworth, L., Guan, T., Grudzien, D. I. D. O. P., Xue, B., ... & Chen, L. (2022). Implications of Industry 4.0 on industrial employment: A comparative survey from Brazilian, Chinese, and German practitioners. Technology in society, 70, 102028. https://doi.org/10.1016/j.techsoc.2022.102028
  • Berger, D., Herkenhoff, K., & Mongey, S. (2022). Labor market power. American Economic Review, 112(4), 1147-1193. https://doi.org/10.3386/w25719
  • Buera, F. J., Kaboski, J. P., Rogerson, R., & Vizcaino, J. I. (2022). Skill-biased structural change. The Review of Economic Studies, 89(2), 592-625. https://doi.org/10.1093/restud/rdab035
  • Charles, L., Xia, S., & Coutts, A. P. (2022). Digitalization and Employment. International Labour Organization Review, 1-53.
  • Crespi, G., E. Tacsir, and M. Pereira. (2019). Effects of Innovation on Employment in Latin America. Industrial and Corporate Change, 28(1), 139–159.
  • Diessner, S., Durazzi, N., & Hope, D. (2022). Skill-biased liberalization: Germany’s transition to the knowledge economy. Politics & Society, 50(1), 117-155. https://doi.org/10.1177/0032329221100656
  • Donovan, K., Lu, W. J., & Schoellman, T. (2023). Labor market dynamics and development. The Quarterly Journal of Economics, 138(4), 2287-2325. https://doi.org/10.1093/qje/qjad019
  • Dou, B., Guo, S., Chang, X., & Wang, Y. (2023). Corporate digital transformation and labor structure upgrading. International Review of Financial Analysis, 90, 102904. https://doi.org/10.1016/j.irfa.2023.102904
  • Fernández-Macías, E. (2018). Automation, digitalisation and platforms: Implications for work and employment. Anticipating and managing the impact of change . Research report: Eurofound. https://doi.org/10.2806/090974
  • Freddi, D. (2018). Digitalisation and employment in manufacturing: Pace of the digitalisation process and impact on employment in advanced Italian manufacturing companies. Ai & Society, 33(3), 393-403.
  • König, Η., Buscher, H., & Licht, G. (1995). Employment, Investment and Innovation at the Firm Level. OECD Jobs Study. Paris: Investment, Productivity and Employment.
  • Konle-Seidl, R., & Danesi, S. (2022). Digitalisation and changes in the world of work. Policy Department for Economic, Scientific and Quality of Life Policies Directorate-General for Internal Policies. European Parliament. https://www. europarl. europa. eu/RegData/etudes/STUD/2022/733986/IPOL_STU (2022) 733986_EN. pdf.
  • Kornelakis, A., Kirov, V., & Thill, P. (2022). The digitalisation of service work: A comparative study of restructuring of the banking sector in the United Kingdom and Luxembourg. European Journal of Industrial Relations, 28(3), 253-272. https://doi.org/10.1177/095968012110568
  • Kusairi, S., Wong, Z. Y., Wahyuningtyas, R., & Sukemi, M. N. (2023). Impact of digitalisation and foreign direct investment on economic growth: Learning from developed countries. Journal of International Studies, 16(1).
  • Laar, D. S., Kolog, P. N., Agbedemnab, P. A., & Bayitaa, S. A. (2023). Navigating the Digital Landscape: Challenges and Opportunities for Online Businesses in the Upper East Region of Ghana. Current Journal of Applied Science and Technology, 42(46), 23-3. https://doi.org/10.9734/cjast/2023/v42i464291
  • Lachenmaier, S., & Rottmann, H. (2007). Employment effects of innovation at the firm level. Jahrbücher für Nationalökonomie und Statistik, 227(3), 254–272. https://doi.org/10.1515/jbnst-2007-0304
  • Lachenmaier, S., & Rottmann, H. (2011). Effects of innovation on employment: A dynamic panel analysis. International Journal of Industrial Organization, 29(2), 210–220. https://doi.org/10.1016/j.ijindorg.2010.05.004
  • McGuinness, S., Pouliakas, K., & Redmond, P. (2023). Skills-displacing technological change and its impact on jobs: challenging technological alarmism? Economics of Innovation and New Technology, 32(3), 370-392. https://doi.org/10.1080/10438599.2021.1919517
  • Muntaka, A. S., Agyei-Owusu, B., Manso, J. F., & Kankam-Boadu, E. (2023). Pursuing transport digitalisation to achieve transport cost optimisation. In Supply Chain Forum: An International Journal (pp. 1-13). Taylor & Francis.
  • Mura, P. O., & Donath, L. E. (2023). Digitalisation and Economic Growth in the European Union. Electronics, 12(7), 1718.
  • Onyango, G. (2023). Crafting Policy Technologies (PolicyTechs): An Introduction to Policy Digitalisation Pathways in Africa. In Public Policy and Technological Transformations in Africa: Nurturing Policy Entrepreneurship, Policy Tools and Citizen Participation (pp. 1-26). Cham: Springer International Publishing.
  • Pärli, K. (2022). Impacts of Digitalisation on Employment Relationships and the Need for more Democracy at Work. Industrial Law Journal, 51(1), 84-108.
  • Twumasi Baffour, P., Quartey, P., & Adu-Danso, E. (2024). The effects of innovation on the quantity and quality of jobs: evidence from sub-Saharan Africa. Innovation and Development, 14(1), 165-187.
  • Baffour, P. T., Ebo Turkson, F., Gyeke-Dako, A., Oduro, A. D., & Abbey, E. N. (2020). Innovation and employment in manufacturing and service firms in Ghana. Small Business Economics, 54, 1153-1164. https://doi.org/10.1007/s11187-018-0120-7
  • Baffour, P. T., Ebo Turkson, F., Gyeke-Dako, A., Oduro, A. D., & Abbey, E. N. (2020). Innovation and employment in manufacturing and service firms in Ghana. Small Business Economics, 54, 1153-1164. https://doi.org/10.1007/s11187-018-0120-7
  • Smaldone, F., Ippolito, A., Lagger, J., & Pellicano, M. (2022). Employability skills: Profiling data scientists in the digital labour market. European Management Journal, 40(5), 671- 684. https://doi.org/10.1016/j.emj.2022.05.005
  • Spath, D., Gausemeier, J., Dumitrescu, R., Winter, J., Steglich, S., Drewel, M. (2022). Digitalisation of Society. In: Maier, A., Oehmen, J., Vermaas, P.E. (eds) Handbook of Engineering Systems Design. Springer, Cham. https://doi.org/10.1007/978-3-030-81159-4_5
  • Thomas, M. P., Srivastava, A., & Mallela, K. (2023). Tourism Exports, Digitalisation, and Employment During the COVID-19 Pandemic: The Case of Indonesia. Economic Research Institute for ASEAN and East Asia.
  • Urbaniec, M., & Żmija, D. (2022). Flexible Forms of Employment in the Age of Digital Transformation. In Industrial Revolution 4.0 (pp. 143-156). Routledge.
  • Warhurst, C., & Hunt, W. (2019). The digitalisation of future work and employment: Possible impact and policy responses (No. 2019/05). JRC Working Papers Series on Labour, Education and Technology.
  • Zimmermann, V. (2009). The impact of innovation on employment in small and medium enterprises with different growth rates. Journal of Economics and Statistics, 229(2), 3. https://doi.org/10.1515/jbnst-2009-2-314

Gana'daki Küçük ve Orta Ölçekli İşletmeler Arasında Dijitalleşme ve İstihdam İlişkisi

Year 2024, Volume: 2 Issue: 2, 100 - 120, 28.12.2024
https://doi.org/10.5281/zenodo.14562410

Abstract

Amaç – Dijitalleşme, henüz incelenmemiş önemli şekillerde çalışma dünyasını dönüştürüyor. Dijital teknolojilerin hızla yayılması, endüstrileri yeniden şekillendiriyor ve istihdam için, özellikle gelişmekte olan ülkelerde istihdam yaratmada merkezi bir rol oynayan küçük ve orta ölçekli işletmeler arasında önemli etkileri olan geleneksel üretim ve hizmet sunum biçimlerini değiştiriyor.

Tasarım/veri/metodoloji – Gana'daki Dünya Bankası İşletme Anketi'nin (2022) son turunu kullanan bu çalışma, dijitalleşme ile istihdam arasındaki ilişkiyi ve Gana'daki küçük ve orta ölçekli işletmeler (KOBİ'ler) arasında kalifiye işgücüne olan talebi araştırmak için işgücü piyasası eşleştirme teorisi ve beceri odaklı teknolojik değişimin teorik çerçevelerinden yararlanıyor.

Bulgular – Bulgular, Gana'daki KOBİ'ler arasında dijitalleşme ile istihdam düzeyleri arasında önemli bir pozitif ilişki olduğunu, dijitalleşme ile kalifiye işgücü arasında ise negatif bir ilişki olduğunu gösteriyor.

Özgünlük/değer – Çalışma, dijitalleşmenin istihdam yaratmadaki potansiyel dönüştürücü etkisini vurgulayarak literatüre katkıda bulunuyor.

Ethical Statement

Not applicable.

Supporting Institution

No funding was provided in writing this manuscript.

Thanks

Not applicable.

References

  • Aboal, D., Garda, P., Lanzilotta, B., & Perera. M. (2015). Innovation, Firm Size, Technology Intensity, and Employment Generation: Evidence from the Uruguayan Manufacturing Sector. Emerging Markets Finance and Trade, 51(1), 3–26.
  • Arsić, M. (2020). Impact of digitalisation on economic growth, productivity and employment. Economic Themes, 58(4), 431-457. https://doi.org/10.2478/ethemes-2020-0025
  • Arthur, K. K., Bannor, R. K., Masih, J., Oppong-Kyeremeh, H., & Appiahene, P. (2024). Digital Innovations: Implications for African Agribusinesses. Smart Agricultural Technology, 100407.
  • Asravor, R. K., & Sackey, F. G. (2023). Impact of technology on macro-level employment and the workforce: What are the implications for job creation and job destruction in Ghana? Social Indicators Research, 168(1), 207-225. https://doi.org/10.1007/s11205-023-03109-6
  • Atiase, V. Y., Agbanyo, S., Ameh, J. K., Sambian, R. M., & Ganza, P. (2022). Creating value for whom? Digitization and governance practices of nontraditional export firms in Africa. Strategic Change, 31(1), 31-44. https://doi.org/10.1002/jsc.2478
  • Aubert-Tarby, C., Escobar, O. R., & Rayna, T. (2018). The impact of technological change on employment: The case of press digitisation. Technological forecasting and social change, 128, 36-45. https://doi.org/10.1016/j.techfore.2017.10.015
  • Autor, D. (2022). The labor market impacts of technological change: From unbridled enthusiasm to qualified optimism to vast uncertainty (No. w30074). National Bureau of Economic Research. Azar, J., Marinescu, I., & Steinbaum, M. (2022). Labor market concentration. Journal of Human Resources, 57(S), S167-S199.
  • Azu, N. P. (2022). Consequences of Digitalisation in Curbing Female Unemployment in West Africa. Available at SSRN 4571504.
  • Bagnoli, L., & Estache, A. (2022). Mentoring migrants for labor market integration: Policy insights from a survey of mentoring theory and practice. The World Bank Research Observer, 37(1), 39-72. https://doi.org/10.1093/wbro/lkab005
  • Beier, G., Matthess, M., Shuttleworth, L., Guan, T., Grudzien, D. I. D. O. P., Xue, B., ... & Chen, L. (2022). Implications of Industry 4.0 on industrial employment: A comparative survey from Brazilian, Chinese, and German practitioners. Technology in society, 70, 102028. https://doi.org/10.1016/j.techsoc.2022.102028
  • Berger, D., Herkenhoff, K., & Mongey, S. (2022). Labor market power. American Economic Review, 112(4), 1147-1193. https://doi.org/10.3386/w25719
  • Buera, F. J., Kaboski, J. P., Rogerson, R., & Vizcaino, J. I. (2022). Skill-biased structural change. The Review of Economic Studies, 89(2), 592-625. https://doi.org/10.1093/restud/rdab035
  • Charles, L., Xia, S., & Coutts, A. P. (2022). Digitalization and Employment. International Labour Organization Review, 1-53.
  • Crespi, G., E. Tacsir, and M. Pereira. (2019). Effects of Innovation on Employment in Latin America. Industrial and Corporate Change, 28(1), 139–159.
  • Diessner, S., Durazzi, N., & Hope, D. (2022). Skill-biased liberalization: Germany’s transition to the knowledge economy. Politics & Society, 50(1), 117-155. https://doi.org/10.1177/0032329221100656
  • Donovan, K., Lu, W. J., & Schoellman, T. (2023). Labor market dynamics and development. The Quarterly Journal of Economics, 138(4), 2287-2325. https://doi.org/10.1093/qje/qjad019
  • Dou, B., Guo, S., Chang, X., & Wang, Y. (2023). Corporate digital transformation and labor structure upgrading. International Review of Financial Analysis, 90, 102904. https://doi.org/10.1016/j.irfa.2023.102904
  • Fernández-Macías, E. (2018). Automation, digitalisation and platforms: Implications for work and employment. Anticipating and managing the impact of change . Research report: Eurofound. https://doi.org/10.2806/090974
  • Freddi, D. (2018). Digitalisation and employment in manufacturing: Pace of the digitalisation process and impact on employment in advanced Italian manufacturing companies. Ai & Society, 33(3), 393-403.
  • König, Η., Buscher, H., & Licht, G. (1995). Employment, Investment and Innovation at the Firm Level. OECD Jobs Study. Paris: Investment, Productivity and Employment.
  • Konle-Seidl, R., & Danesi, S. (2022). Digitalisation and changes in the world of work. Policy Department for Economic, Scientific and Quality of Life Policies Directorate-General for Internal Policies. European Parliament. https://www. europarl. europa. eu/RegData/etudes/STUD/2022/733986/IPOL_STU (2022) 733986_EN. pdf.
  • Kornelakis, A., Kirov, V., & Thill, P. (2022). The digitalisation of service work: A comparative study of restructuring of the banking sector in the United Kingdom and Luxembourg. European Journal of Industrial Relations, 28(3), 253-272. https://doi.org/10.1177/095968012110568
  • Kusairi, S., Wong, Z. Y., Wahyuningtyas, R., & Sukemi, M. N. (2023). Impact of digitalisation and foreign direct investment on economic growth: Learning from developed countries. Journal of International Studies, 16(1).
  • Laar, D. S., Kolog, P. N., Agbedemnab, P. A., & Bayitaa, S. A. (2023). Navigating the Digital Landscape: Challenges and Opportunities for Online Businesses in the Upper East Region of Ghana. Current Journal of Applied Science and Technology, 42(46), 23-3. https://doi.org/10.9734/cjast/2023/v42i464291
  • Lachenmaier, S., & Rottmann, H. (2007). Employment effects of innovation at the firm level. Jahrbücher für Nationalökonomie und Statistik, 227(3), 254–272. https://doi.org/10.1515/jbnst-2007-0304
  • Lachenmaier, S., & Rottmann, H. (2011). Effects of innovation on employment: A dynamic panel analysis. International Journal of Industrial Organization, 29(2), 210–220. https://doi.org/10.1016/j.ijindorg.2010.05.004
  • McGuinness, S., Pouliakas, K., & Redmond, P. (2023). Skills-displacing technological change and its impact on jobs: challenging technological alarmism? Economics of Innovation and New Technology, 32(3), 370-392. https://doi.org/10.1080/10438599.2021.1919517
  • Muntaka, A. S., Agyei-Owusu, B., Manso, J. F., & Kankam-Boadu, E. (2023). Pursuing transport digitalisation to achieve transport cost optimisation. In Supply Chain Forum: An International Journal (pp. 1-13). Taylor & Francis.
  • Mura, P. O., & Donath, L. E. (2023). Digitalisation and Economic Growth in the European Union. Electronics, 12(7), 1718.
  • Onyango, G. (2023). Crafting Policy Technologies (PolicyTechs): An Introduction to Policy Digitalisation Pathways in Africa. In Public Policy and Technological Transformations in Africa: Nurturing Policy Entrepreneurship, Policy Tools and Citizen Participation (pp. 1-26). Cham: Springer International Publishing.
  • Pärli, K. (2022). Impacts of Digitalisation on Employment Relationships and the Need for more Democracy at Work. Industrial Law Journal, 51(1), 84-108.
  • Twumasi Baffour, P., Quartey, P., & Adu-Danso, E. (2024). The effects of innovation on the quantity and quality of jobs: evidence from sub-Saharan Africa. Innovation and Development, 14(1), 165-187.
  • Baffour, P. T., Ebo Turkson, F., Gyeke-Dako, A., Oduro, A. D., & Abbey, E. N. (2020). Innovation and employment in manufacturing and service firms in Ghana. Small Business Economics, 54, 1153-1164. https://doi.org/10.1007/s11187-018-0120-7
  • Baffour, P. T., Ebo Turkson, F., Gyeke-Dako, A., Oduro, A. D., & Abbey, E. N. (2020). Innovation and employment in manufacturing and service firms in Ghana. Small Business Economics, 54, 1153-1164. https://doi.org/10.1007/s11187-018-0120-7
  • Smaldone, F., Ippolito, A., Lagger, J., & Pellicano, M. (2022). Employability skills: Profiling data scientists in the digital labour market. European Management Journal, 40(5), 671- 684. https://doi.org/10.1016/j.emj.2022.05.005
  • Spath, D., Gausemeier, J., Dumitrescu, R., Winter, J., Steglich, S., Drewel, M. (2022). Digitalisation of Society. In: Maier, A., Oehmen, J., Vermaas, P.E. (eds) Handbook of Engineering Systems Design. Springer, Cham. https://doi.org/10.1007/978-3-030-81159-4_5
  • Thomas, M. P., Srivastava, A., & Mallela, K. (2023). Tourism Exports, Digitalisation, and Employment During the COVID-19 Pandemic: The Case of Indonesia. Economic Research Institute for ASEAN and East Asia.
  • Urbaniec, M., & Żmija, D. (2022). Flexible Forms of Employment in the Age of Digital Transformation. In Industrial Revolution 4.0 (pp. 143-156). Routledge.
  • Warhurst, C., & Hunt, W. (2019). The digitalisation of future work and employment: Possible impact and policy responses (No. 2019/05). JRC Working Papers Series on Labour, Education and Technology.
  • Zimmermann, V. (2009). The impact of innovation on employment in small and medium enterprises with different growth rates. Journal of Economics and Statistics, 229(2), 3. https://doi.org/10.1515/jbnst-2009-2-314
There are 40 citations in total.

Details

Primary Language English
Subjects Macroeconomics (Other)
Journal Section Research Articles
Authors

Esther Azigi This is me 0009-0008-7743-0902

Priscilla Twumasi Baffour This is me 0000-0001-8792-5265

Publication Date December 28, 2024
Submission Date July 22, 2024
Acceptance Date November 1, 2024
Published in Issue Year 2024 Volume: 2 Issue: 2

Cite

APA Azigi, E., & Baffour, P. T. (2024). Digitalization and Employment among Small and Medium Enterprises in Ghana. Journal of Economics, Finance and Sustainability, 2(2), 100-120. https://doi.org/10.5281/zenodo.14562410
AMA Azigi E, Baffour PT. Digitalization and Employment among Small and Medium Enterprises in Ghana. EFS. December 2024;2(2):100-120. doi:10.5281/zenodo.14562410
Chicago Azigi, Esther, and Priscilla Twumasi Baffour. “Digitalization and Employment Among Small and Medium Enterprises in Ghana”. Journal of Economics, Finance and Sustainability 2, no. 2 (December 2024): 100-120. https://doi.org/10.5281/zenodo.14562410.
EndNote Azigi E, Baffour PT (December 1, 2024) Digitalization and Employment among Small and Medium Enterprises in Ghana. Journal of Economics, Finance and Sustainability 2 2 100–120.
IEEE E. Azigi and P. T. Baffour, “Digitalization and Employment among Small and Medium Enterprises in Ghana”, EFS, vol. 2, no. 2, pp. 100–120, 2024, doi: 10.5281/zenodo.14562410.
ISNAD Azigi, Esther - Baffour, Priscilla Twumasi. “Digitalization and Employment Among Small and Medium Enterprises in Ghana”. Journal of Economics, Finance and Sustainability 2/2 (December 2024), 100-120. https://doi.org/10.5281/zenodo.14562410.
JAMA Azigi E, Baffour PT. Digitalization and Employment among Small and Medium Enterprises in Ghana. EFS. 2024;2:100–120.
MLA Azigi, Esther and Priscilla Twumasi Baffour. “Digitalization and Employment Among Small and Medium Enterprises in Ghana”. Journal of Economics, Finance and Sustainability, vol. 2, no. 2, 2024, pp. 100-2, doi:10.5281/zenodo.14562410.
Vancouver Azigi E, Baffour PT. Digitalization and Employment among Small and Medium Enterprises in Ghana. EFS. 2024;2(2):100-2.