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)

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

Economic Commission for Africa Policy response (cont) Governments need to also focus on strategies that promote human capital development Governments need to also focus on strategies that promote human capital development 1. Improve access to and quality of formal education 2. Provide training and other policies to assist youth after finishing school

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

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

Economic Commission for Africa Public works programme in Senegal With WB and ADB, Senegal govt. set up a public works programme to target unemployed youth 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. 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 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. 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. 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. The projects also led to the establishment of 6,000 permanent jobs.

Economic Commission for Africa Public works programmes (cont) But do such programmes really provide any long-term opportunities for young people? 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? 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? Do they have a role in post-conflict countries?

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

Economic Commission for Africa THANK YOU