Input Factors and Industrial Sector Growth in Uganda (1986-2024)

Abstract

This study investigates the effects of input factors on the growth of Uganda’s industrial sector. Specifically, it examines the impact of Gross Fixed Capital Formation (GFCF), investment in education, and population growth. A longitudinal research design was used to analyze changes over time, utilizing secondary data from reputable national and international sources. The data was processed using STATA 14, which is effective for time series analysis. Findings show that increasing investment in GFCF such as factories, machinery, and infrastructure significantly boosts industrial growth, particularly in the short term through job creation and increased output. However, in the long run, the benefits diminish unless complemented by improvements in skilled labor and institutional support. In contrast, investment in education showed no direct effect on industrial growth, possibly due to a mismatch between education outputs and industrial job demands. Additionally, population growth alone was not found to drive industrial expansion, indicating that sheer numbers in the workforce do not guarantee increased productivity. The study recommends that the Government of Uganda continues prioritizing investment in industrial infrastructure especially in energy, transport, and manufacturing hubs. To improve education's relevance, greater emphasis should be placed on technical and vocational education and training (TVET), along with stronger industry-academic linkages and curriculum reforms. Furthermore, policymakers should promote labor-intensive industries like agro-processing, textiles, and construction, and support entrepreneurship and inclusive employment incentives, particularly targeting youth and women.