Promoting Decent Employment for Africa’s Youth

1. Promoting Decent Employment for Africa’s Youth The Role of Education and Training Sher Verick Economic and Social Policy Division Economic Commission for Africa (ECA)

2. Overview • The situation for Africa’s youth in the labour market is tough • Unemployment is high • Underemployment is common • Few job opportunities in the formal economy Economic Commission for Africa

3. Overview (cont) • Reasons for this employment situation • Inadequate economic growth and lack of growth in labour-absorbing sectors • Public sector downsizing and undeveloped formal private sector • Poor health (HIV/AIDS) • Increasing youth population • Lack of education and inappropriate skills Economic Commission for Africa

4. Why is education important? • Human capital - abilities, skills and knowledge embodied in a person • Macro-level - HC is a key driver of economic growth, development and well-being • Micro-level - more HC leads to better employment chances and higher wages Economic Commission for Africa

5. Education in Africa • Education levels in Africa are low, though countries are making progress • Average net primary school enrolment rate is 67% • Ranges from 28% in Niger to 99% in Cape Verde and the Seychelles • Significant gender disparities Economic Commission for Africa

6. Education in Africa (cont) • But primary education is not enough to get a reasonable job • Secondary enrolment rates are much lower - 45% (lower) and 29% (upper) • Another problem is the quality of education • Pupil-teacher ratio reaches 68:1 in Chad (65 in Ethiopia) • Supply of teachers is also a major constraint particularly as the result of HIV/AIDS Economic Commission for Africa

7. School-to-work transition • The next step is the STW • When a young person leaves formal education to enter the labour market • The transition can result in three main outcomes • Employment (in different forms), unemployment, inactivity Economic Commission for Africa

8. STW (cont) • This process is dynamic • Unemployment -> employment • Longer duration in unemployment makes it more difficult to find a job • Informal employment -> formal employment Economic Commission for Africa

9. Youth in the African labour market - unemployment Economic Commission for Africa

10. Youth unemployment (cont) • Considerable regional diversity • 55.8% in South Africa • 10.9% in Namibia • Urban unemployment rates are higher than in rural areas • Female rates are lower because of lower participation in labour force Economic Commission for Africa

11. Youth unemployment (cont) • We expect that the unemployment rate decreases with the level of education (OECD countries) • But this tends not to be the case in Africa • The better educated experience higher rates of unemployment • This is reflected in queuing for public sector jobs • University graduates also suffer from a skill mismatch Economic Commission for Africa

12. Youth unemployment (cont) • But there are serious measurement problems with official unemployment figures • They also do not capture other dimensions such as underemployment and working poverty • These are prevalent in subsistence agriculture and the urban informal sector Economic Commission for Africa

13. Consequences of unemployment and underemployment • Rural-urban migration – end up working in the informal sector • Crime, prostitution and violence • Conflict • Poor health • Inability to further invest in human capital • Social exclusion • But there are also coping strategies – entrepreneurial spirit Economic Commission for Africa

14. Summary of the situation • Education and training are essential • But progress in this area in Africa is inadequate • Youth have difficulties in the labour market as reflected by unemployment and underemployment • The economic, social and political costs are very high • The extent of the problem should be clear for all stakeholders Economic Commission for Africa

15. Policy response • What should governments do to create decent jobs for young people? • What is a decent job in this context? What should be the objective? Economic Commission for Africa

16. Policy response (cont) • Job creation requires economic growth • Increase domestic and foreign investment, improve infrastructural capacity, develop private sector, remove regulation barriers • But growth per se is not enough • Encourage labour-intensive sectors – structural transformation Economic Commission for Africa

17. Policy response (cont) • Governments need to also focus on strategies that promote human capital development • Improve access to and quality of formal education • Provide training and other policies to assist youth after finishing school Economic Commission for Africa

18. Improving the skill match in Egypt • Combine formal education with vocational training to tackle skill mismatching • Egypt adopted the German approach in 1991 • Involved employers and enterprises to develop training • Since 1994 – over 14,500 young people have been trained in 29 trades Economic Commission for Africa

19. Active labour market policies • ALMPs include • Policies to promote wage employment through subsidised placement, employment assistance and vocational training • Measures to encourage self-employment such as training, and facilitating access to credit/grants and other business requirements Economic Commission for Africa

20. Public works programme in Senegal • With WB and ADB, Senegal govt. set up a public works programme to target unemployed youth • Aim: provide short-term employment through labour-intensive public works projects such as construction, rehabilitation and maintenance of public services, and provision of essential services. Economic Commission for Africa

21. Public works programme in Senegal (cont) • During the 1st phase of the programme, around 80,000 jobs were created for young people in 416 projects in small-scale enterprises. • Overall 3,226 projects have been implemented resulting in the creation of 350,000 temporary jobs p.a. • The projects also led to the establishment of 6,000 permanent jobs. Economic Commission for Africa

22. Public works programmes (cont) • But do such programmes really provide any long-term opportunities for young people? • Or are they just a source of cheap labour for the government to undertake infrastructure projects? • Do they have a role in post-conflict countries? Economic Commission for Africa

23. Youth-led initiatives • It is not only the responsibility of the government but also of youth • Governments are constrained in directly creating jobs • Youth are more than capable of initiating entrepreneurial activities and setting-up businesses • Please share such experiences… Economic Commission for Africa

24. THANK YOU Economic Commission for Africa