Unemployment and lack of decent jobs: A twin-problem stifling African youth productivity

Africa’s employment landscape is marred by a complex interplay of high unemployment rates and a significant lack of decent jobs. This dual challenge presents a substantial barrier to the continent’s inclusive growth and socio-economic stability.

Recent findings underscore the urgent need for policy interventions to address both the quantity and quality of employment across the region.

The Scale of the Problem

A recent policy brief by Adedeji Adeniran and colleagues reveals that, while the official unemployment rate in Africa stands at 11.6 per cent, the issue of vulnerable employment is far more pervasive.

“At least 60 per cent of individuals are in vulnerable employment across selected African countries,” the brief states, highlighting a critical issue: many Africans are engaged in work that does not meet the standards of decent employment as defined by the International Labour Organisation (ILO).

According to the report, the 60 per cent of individuals engage in vulnerable employment, such as own-account workers and contributing family workers who typically lack formal work arrangements, social security, and adequate working conditions.

Also read: Nigeria’s Unemployment Rate Drops to 4.1%. Here is Why That is a Problem.

In countries like Nigeria and Ethiopia, the vulnerable employment rate exceeds 80 per cent, despite relatively low unemployment rates below 6 per cent. This discrepancy underscores the prevalence of insecure and inadequately protected jobs

The Rise of the Working Poor

The share of employed individuals living below the World Bank’s international poverty line of $2.15 per day is alarmingly high. “The proportion of individuals categorised as working poor is as high as 40 per cent in Rwanda and Uganda and around 25 per cent in Ghana, Ethiopia, and Kenya,” the report highlights, reflecting the prevalence of jobs that fail to provide a living wage.

Child Labour and Youth Employment

Child labour remains a significant issue in Sub-Saharan Africa, contributing to the region’s employment challenges. Many young people are forced into the labour market early, often in conditions that do not support their development or future employability.

“Employed people living in households that fall below the World Bank’s international poverty line… is another indicator of a lack of decent jobs,” notes the report, emphasising the impact on youth.

The Role of the Informal Sector

The informal sector plays a crucial role in the African economy, providing a safety net for those unable to secure formal employment. However, this sector is characterised by a lack of decent working conditions.

“Jobs in the informal economy, including street vending, casual labour, and family enterprises, often lack stability, fair income, and social protection,” the brief explains.

The informal sector’s dominance is partly due to the low absorptive capacity of the formal sector, which fails to generate sufficient decent jobs for the burgeoning youth population. The capital-intensive nature of key industries like mining and oil further limits job creation, worsening the employment challenge.

Social Protection Gaps

Social protection coverage in Africa is woefully inadequate. “Less than 30 per cent of the population in selected countries has access to any form of social protection,” the report reveals.

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In countries like Ethiopia, Kenya, Rwanda, and Uganda, this coverage drops below 10 per cent, leaving a vast majority of the workforce vulnerable to economic shocks and perpetuating the cycle of poverty and indecent work.

Policy Recommendations

To address these multifaceted challenges, the policy brief suggests several key interventions:

1. Enhancing Social Protection: Expanding social protection coverage can provide a safety net for vulnerable workers, enabling them to seek better employment opportunities and invest in skill development.
2. Strengthening the Formal Sector: Policies that promote the growth of the formal sector, particularly in industries with high job-creation potential, are essential. This includes investments in infrastructure, education, and vocational training to align workforce skills with market demands.
3. Supporting the Informal Economy: Improving conditions in the informal sector through better regulation, access to credit, and entrepreneurial education can enhance the quality of jobs available to most of the workforce.
4. Focusing on Youth Employment: Targeted programmes that address the specific needs of young workers, including apprenticeships and entry-level job schemes, can help integrate them into the formal economy and reduce the incidence of child labour.

Africa’s employment challenge is not merely about creating more jobs but ensuring that these jobs are decent, providing fair wages, job security, and conducive working conditions. By addressing the root causes of vulnerable employment and strengthening both social protection and formal job opportunities, African countries can pave the way for sustainable economic growth and improved livelihoods for their populations.

This comprehensive approach is essential for unlocking Africa’s demographic dividend and achieving long-term socio-economic stability.

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