Youth unemployment: A bomb ready to explode
The 5th Africa Think Tank Summit, a creation of the African Capacity Building Foundation (ACBF), the African Union’s specialised agency for capacity building, tackled one of Africa’s most pressing issues – youth unemployment. Baffour Ankomah attended the event in Accra, Ghana.
Held in the Ghanaian capital, Accra, from 5-7 April, the Summit brought together some 200 participants from think tanks, international and national organisations, civil society groups, and government officials from across the continent. The theme this year was: “Tackling Africa’s youth unemployment challenge: innovative solutions from think tanks.”
The aim was to inform decision makers and solution-seekers about how think tanks can support the fight against youth unemployment by paying special attention to dimensions around transformative leadership, a conducive environment for the private sector to thrive, and the development of critical skills required by the labour market.
Started in 2014, the Africa Think Tank Summit is an annual event that brings together more than 40 think tanks, most of them created and supported by the ACBF, to discuss and proffer solutions to pertinent issues affecting African development.
Since its inception, the Summit has attracted support from ACBF partners such as the African Union Commission, the African Development Bank (AfDB), the NEPAD Planning and Coordinating Agency, and the UN Economic Commission for Africa (UNECA).
This year, because of the importance the Summit has gained in recent years, more partners came forward to support it, including the United Nations Conference on Trade and Development (UNCTAD), the Think Tank Initiative (TTI), the William and Flora Hewlett Foundation, the Bill and Melinda Gates Foundation, the Regional Network of Agricultural Policy Research Institutes (ReNAPRI), and the Alliance for African Partnership.
Frightening prospect
The Accra Summit was told of the frightening prospect of 12m African youths joining the workforce every year but only 30% succeeding in finding employment due to either low or mismatching skill sets. The remaining 70% become unemployed and pose a grave danger to national stability.
In 2016, an AfDB publication on “Jobs for Youths in Africa” said that of nearly 420m youths aged 15-35 on the continent, one-third are unemployed and discouraged, while another third are vulnerably employed in the informal, low productivity, and low-wage sectors. Worse, more than 70% of the unemployed youth live in rural areas, and female youths in particular face stronger challenges.
In his welcome address to the Accra Summit, ACBF’s Executive Secretary, Prof. Emmanuel Nnadozie described Africa’s distressing youth unemployment rate as a bomb ready to explode, and called on African leaders to provide “a visionary and transformative leadership” if the continent is to successfully tackle the problem.
“The youth are Africa’s biggest single asset but also its greatest challenge ever,” Prof. Nnadozie said. “As indicated in a 2017 ACBF study on youth unemployment in Africa, the continent’s youth population is rapidly growing and expected to double to over 830m, representing 29% of the world’s youths by 2050.
“If properly harnessed, the increase in the youthful population could support increased productivity and stronger, more inclusive economic growth across the continent. But if not properly harnessed, it can become a time-bomb, in fact it is already a bomb ready to explode.”
The situation, he said, was unsustainable but could be saved by prompt remedial action. “To maximise the demographic dividend, we will have to create high-productivity jobs at an average of about 18m per year until 2035 to absorb the new entrants in the labour force,” he explained. “Therefore a visionary and transformative leadership is a must if African countries want to successfully tackle the youth unemployment issue.”
Prof. Nnadozie’s view was amplified by the Summit’s keynote speaker, Ghana’s Minister of Finance, Ken Ofori-Atta (who is also a member of the ACBF Board of Governors). He said the massive youth unemployment problem was responsible for the upsetting scenes of hundreds of thousands of African youths leaving the continent, with many dying in the Mediterranean Sea in their bid to reach Europe, where they think they can find jobs.
“Overall, the World Employment Social Outlook report for 2018 shows that the share of people willing to move abroad remained the highest in sub-Saharan Africa, at 32.1% in 2016 (against 30% in Latin America),” Ofori-Atta said, and called on African governments to take the matter seriously enough by taking immediate steps to address the youth unemployment challenge, given its degree of urgency.
Interestingly, not only is Africa’s youth population growing, it is also becoming more educated. For example, according to estimates, more than 59% of 20 to 24-year-olds will have had secondary education by 2030 as compared to only 42% in 2015. But education is not providing better employment opportunities for the youth. As a result, policy attention has now shifted to the potential for young people to create their own employment.
Agriculture is the solution
In this regard, it was the general view of the Summit that African governments and the private sector should help the youth to move into agriculture, already Africa’s largest employer.
“Agriculture could be an important immediate means of catalysing economic growth and employment for the youth if African governments remove the barriers that hold back the future farmers of the continent,” according to Dr Assefa Admassie, Executive Director of the Ethiopian Economic Policy Research Institute (EEPRI), who gave the lead address of Panel 4 of the Summit.
Unfortunately, the African youth tend to perceive farming as an occupation for the aged, the illiterate, and for people living in rural areas. “Yet, agribusiness can provide employment opportunities that can lift the youth out of poverty,” Dr Admassie said, stressing that “there are great opportunities for entrepreneurship along the whole agricultural value chain”.
But to attract the youth into agriculture, he said, “farming must shift from an occupation of last resort and low productivity to one of technical dynamism and recognised opportunity – a business.”
As a result, governments must tackle the challenges that impede progress, such as the lack of funds, the lack of relevant mentorship, poor regulatory environment, poor technical skills, and the lack of markets.
“The African youth will need to fill their own buckets,” Dr Admassie said, “but it is our imperative to remove the barriers that hold back the future farmers of our world.”
Statistics shows that many young people in Africa are pushed into self-employment or entrepreneurship. In other words, entrepreneurship has become a critical pathway for creating employment for the youth.
Dr Admassie declared that “22% of Africa’s working-age population are starting new businesses, which is the highest rate of any region in the world. This is why African governments should step in and offer youth entrepreneurs all the necessary support to survive, so that Africa’s youth bulge can become a blessing instead of a curse.”
Learning from foreign examples
Other panelists looked at the underlying reasons why the youth unemployment problem has become so intractable. The number one culprit, it was said, was the “mismatch” between the training and skills of graduates from African educational institutions on the one hand, and the requirements of the labour market on the other hand.
According to published statistics, over 50% of the world’s graduates in humanities and arts come from Africa, and a good 95% of African students study social science, business, and law, while only 4% study engineering, manufacturing and construction. Worse, only 2% study agriculture, even though agriculture contributes 32% of Africa’s GDP.
Thus, the vast majority of African students finish their education with no practical skills or with skills that the labour market does not normally require. This worrying situation exercised the mind of one panellist at the Summit, Dr Nkosana Moyo, the Founder & Executive Director of the Mandela Institute for Development Studies (MINDS, in South Africa) and an independent presidential candidate in Zimbabwe’s 2018 elections, to ask African countries to take a cue from German education, where not everyone is expected to be a professor but where technical training is strongly respected and embedded.
Unlike the practice in Africa, Dr Moyo said, German education puts a high premium on technical training where students cannot graduate from tertiary education without practical hands-on experience. Because of this system, the German economy has a grounding unequalled in Europe, making it the best among its peers.
According to Dr Moyo, German education has a lot to teach Africa, especially if the continent wants to defeat the “skills mismatch” syndrome. His view was roundly supported by other panellists, who agreed that entrepreneurship training should be part of not only the African educational system but also national development planning. Support for Small and Medium Enterprises (SMEs), and private equity funds targeting young entrepreneurs should be part of the mix.
Another solution, according to Prof. Chinedum Nwajiuba, the Vice-Chancellor of the Alex Ekwueme Federal University in Nigeria, is for think tanks to tactically change the mind-set of African governments, so they start considering the private sector as collaborators or partners in development, instead of competitors.
He said think tanks should facilitate a forum for private-public strategic meetings that would consider the direction in which national economies should be headed and governments should give incentives to help private companies to get there, with youth employment as a major component.
He cited the example of South Korea, which used the same model to lift itself from poverty to riches in the last few decades. Describing it as “Korea’s strategy in winning the microwave war”, the Nigerian don said the plan was predicated on investing not just in better technology but in better minds too.
“Korea had two advantages: low-wage workers and a willingness to wait for a payback,” Prof. Nwajiuba explained, singling out the role the Korean government directly played in the country’s development by setting up an economic development board whose main duty was to think about where Korea’s economy should be headed and give incentives to help private companies to get there.
“The board built industrial parks, subsidised utilities, provided tax rebates for export, and made low-cost loans for investment in selected new products,” the Nigerian academic said, adding: “The incentives were particularly helpful to big companies like Samsung, whose managers met frequently with government officials, plotting strategy, trading ideas, and discussing projects.
“This is unlike what is obtainable in Africa where governments see the private sector as competitors, yet a larger and more productive private sector is a necessity if Africa is to create adequate jobs for the younger generation.”
The Summit ended with a resolution calling on African governments to take youth unemployment very seriously and do whatever is necessary to conquer
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