Namibia’s emerging green hydrogen and oil and gas industries are unlikely to significantly reduce the country’s high unemployment rate in the short to medium term, despite their expected contribution to economic growth, according to Simonis Storm’s Namibia Economic Growth Outlook for 2026.
The research firm said that while large-scale energy investments could support gross domestic product expansion, their direct impact on employment would remain limited due to structural weaknesses in the labour market.
Simonis Storm estimates youth unemployment at around 43%, with the overall unemployment rate projected to remain broadly unchanged at between 35% and 36% in 2026.
The report argues that Namibia’s labour market challenges are structural rather than cyclical, driven by limited labour absorption capacity, persistent skills mismatches and subdued private-sector job creation.
“Namibia’s unemployment challenge is not primarily a function of insufficient educational attainment, but rather a widening misalignment between the type of qualifications produced and the structure of labour demand,” the report states.
According to the firm, higher education institutions continue to produce graduates in general academic fields such as business administration, public administration and social sciences, while labour demand is increasingly concentrated in technical, industrial and applied occupations.
Employers in sectors such as energy, construction, logistics, manufacturing and mining reportedly face shortages of technicians, artisans, mid-level engineers, plant operators and maintenance personnel, even as graduate unemployment remains elevated.
Simonis Storm describes the situation as an inverted skills pyramid, noting that industrial projects typically require a broad base of artisans and technicians for every engineer employed.
The report further highlights that capital-intensive industries, including oil and gas and green hydrogen, tend to generate relatively few direct jobs during early development and operational phases.
“The primary employment opportunity lies not in upstream extraction itself, but in the development of secondary and support industries along the value chain,” the firm said, citing fabrication, manufacturing inputs, logistics, port services, equipment maintenance and industrial services as potential employment multipliers.
However, it warned that without a technically capable domestic workforce, these downstream opportunities risk being captured by foreign contractors, limiting the local employment dividend.
Simonis Storm argued that economic growth alone would not resolve unemployment unless the workforce is better aligned with sector-specific occupational needs.
In this regard, the firm identified the expansion and modernisation of Technical and Vocational Education and Training (TVET) as central to labour market reform.
“Structured apprenticeship models combining classroom instruction with paid workplace training are effective mechanisms to bridge the education-to-employment gap. Structural unemployment cannot be reduced through growth alone; it requires targeted skills development aligned with sectoral demand,” the report said.
The firm added that stronger public-private coordination would be essential, including the development of accreditation frameworks, incentives for firms to train apprentices, and clear progression pathways from artisan to technician and engineer.
International partners such as KfW and GIZ could support system development, but domestic policy alignment would remain critical, the report noted.
The findings come as government seeks to maximise local benefits from the emerging petroleum sector.
In 2024, Cabinet approved Namibia’s National Upstream Petroleum Local Content Policy, which requires companies to prioritise Namibian employment, provide specialised training, source goods and services locally, and facilitate knowledge and technology transfer.
Carlo McLeod, Deputy Head of the Upstream Petroleum Unit in the Presidency, previously said petroleum resources would only become a national blessing if managed responsibly.
As of early 2026, the local content policy remains in a post-approval draft stage, with a final draft issued in March 2025 and nationwide consultations ongoing.
