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Research Article

Assessing the Effect of Unemployment Levels on the Economic Welfare of Local Communities in Zambia: A Case Study of Mandevu Township in Lusaka

Authors

  • Patrick Mukengami School of Humanities and Business, Information and Communications University, Lusaka, Zambia
  • Peter Silwimba Risk Department, National Savings and Credit Bank and School of Humanities and Business, Information and Communications University, Lusaka, Zambia https://orcid.org/0000-0001-6663-1866

    silwimbap47@gmail.com

Abstract

This study examined the effect of unemployment on the economic welfare of households in Mandevu Township, Lusaka District. The primary objectives were to assess the effects of unemployment levels on the consumption of basic goods, acquisition of assets in investment and the coping strategies in the stage of unemployment. Using a mixed method research design, data were collected from 100 different households through structured questionnaires. The findings revealed that unemployment did not significantly reduce overall household welfare, as all respondents reported affording the general basic needs such as three meals a day, although other essentials like transport, education, and healthcare were less accessible. A statistical significant test yielded a no significant difference in terms of meeting basic needs without employment compared to those in employment (ANOVA test at n = 100, df treatment = 1, F stat= 127.29 and p = 4.07e-23). Results further revealed interesting positive significant effects of unemployment on levels of investment. Most respondents 85% owned assets, and their priority on owning assets was high, and 15% never owned any asset. A mean vs hypothesis value test gave 0.66 phi coefficient and Cramer’s V value with significance test and Cramer’s V degree of association between unemployment and investment and a significance test p value = 9.68e-9. The study found that unemployment is managed by engaging in business as 88% relied on small businesses as coping strategies. The study concluded that unemployment is not as bad as perceived, being out of formal employment enables households to engage in other economic activities which sustain them, and it increases the propensity to invest for security compared to those in formal employment. While the study recommends policies that promote job creation, much effort should be placed on SME development, skills training, and social protection to enhance household welfare and resilience in Mandevu Township.

Keywords:

Consumption Economic Welfare Investment Local Communities Unemployment

Article information

Journal

Journal of Economics, Business, and Commerce

Volume (Issue)

2(2), (2025)

Pages

318-329

Published

07-12-2025

How to Cite

Mukengami, P., & Silwimba, P. (2025). Assessing the Effect of Unemployment Levels on the Economic Welfare of Local Communities in Zambia: A Case Study of Mandevu Township in Lusaka. Journal of Economics, Business, and Commerce, 2(2), 318-329. https://doi.org/10.69739/jebc.v2i2.1091

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