African youth and mixed livelihoods: Tech provides silver lining amid pandemic

African youth and mixed livelihoods: Tech provides silver lining amid pandemic

August 12, 2020    

In 2019, one in five youth in Africa were not in employment, education or training [1]. Each year, 10 to 12 million youth enter the workforce [2], while only 3 million formal jobs are created. The emergence of the COVID-19 pandemic and a deterioration in African growth prospects is expected to further limit labour market opportunities for young people, especially for the most vulnerable segments: youth in rural areas and young women.

There is no quick solution to the long-standing youth unemployment challenge in Africa. Traditional development sector intervention tools have mainly been on the supply side, e.g. vocational training, wage subsidies, and job placement support. These are typically high costs and have limited scalability. A World Bank stock-take [3] of these interventions revealed that only a third had an impact on employment or earnings. Although the Global Entrepreneurship Monitor finds that African youth are among the most entrepreneurial in the world [4], overall youth-led firms are most at risk of permanently shutting down [5] due to the pandemic.

African youth have not benefited significantly from formal-sector wage employment and so commonly adopt mixed livelihoods approaches to make a living. Research conducted in Ghana and Uganda showed that a large proportion of youth are engaging in multiple activities to generate a livelihood: wage employment (mainly in the informal sector), entrepreneurship, self-employment and (often seasonal) work in agricultural value chains [6].

Mixed livelihood strategies may be an increasingly important mechanism for youth to survive and become more resilient in a post-COVID world. As such, the pandemic is giving rise to a tech-fuelled silver lining: rapid digital transformation of market exchanges, including informal activities, which is, in turn, contributing to boosting mixed livelihood opportunities for youth.

Technology can be leveraged as a channel for youth to access job-matching services, education and skills training. Digital job-matching platforms in Africa are reducing information asymmetries for the youth and connecting them to new forms of self-employment. Of the 90+ freelance/job-matching platforms we identified that operate across Africa [7], a large proportion are matching work seekers with self-employment opportunities in professional and personal services, varying from domestic services to cloud-based microwork tasks. These digital platforms are providing not only a job-matching function but also skills training to enhance the employability of the youth. Jobberman, a leading job-matching platform in Nigeria, recently partnered with the Mastercard Foundation to roll out a large-scale soft and digital skills online training programme designed to reach five million Nigerian youth by 2025 [8]. Moreover, the referral and rating systems embedded in these digital platforms positively affect the jobs and earnings of online gig workers [9].

e-Commerce platforms are increasingly providing youth entrepreneurs with access to new consumer markets, secure payment channels and last-mile delivery services to get their products to market. Uganda is perhaps one of the leading markets in this respect. Safeboda recently expanded its vertical offering from e-hailing to e-commerce in the country, connecting market vendors to customers with the last-mile delivery services of boda boda drivers [10]. Similarly, Jumia, Africa’s largest e-commerce platform, services just over 3,000 produce market vendors in Uganda, with 60% of vendors being youth, women and the disabled [11]. These types of initiatives are underpinned by an enabling environment for digital transformation: the Ugandan Government has worked closely with telecommunication operators to lower transaction fees for digital services and to roll out associated internet data services for consumers. Following the success of tech-led initiatives through the pandemic, the Ugandan Government is now planning to develop a national e-commerce strategy.

Expanding digital spaces and networks where young people can find work and formalise their participation in the economy is likely to improve youth livelihood prospects and resilience. However, inequities can come in the form of unequal development of the relevant skills needed to flourish online and the disparate benefits of technology usage according to socioeconomic status. There is a need to better understand the barriers of Africa’s youth in accessing and using technology towards mixed livelihood strategies, especially the more vulnerable segments of youth. Moreover, learnings from the COVID-19 pandemic responses have shown that stronger levels of collaboration between development practitioners, policymakers and technology players are needed to catalyse efficient and scalable programmatic solutions for enabling mixed livelihood strategies of Africa’s youth.

[1] ILO. (n.d). Global Employment Trends for Youth 2020: Africa.
[2] African Development Bank Group. (2016). Jobs for Youth in Africa.
[3] World Bank. (2018). Integrated Youth Employment Programs: A Stocktake of Evidence on what works in Youth Employment programs.
[4] Around 40% of young people in Ghana, Uganda and Zambia are found to be involved in “early state entrepreneurial activity”; this includes young people aged 18–35 setting up a business or running a business of less than three and a half years old.
[5] International Trade Centre. (2020). SME Competitiveness Outlook 2020.
[6] The Mastercard Foundation. (2017).  Invisible lives: Understanding youth livelihoods in Ghana and Uganda.
[7] Johnson, C. et al. (2020). Emerging trends from Africa’s digital platforms.
[8] Jobberman.
[9] Pallais, A. and Sands, E.G. (2015). Why the referential treatment: Evidence from field experiments on referrals.
[10] UNCTAD. (2020). Ugandan e-commerce platforms power recovery from COVID-19 crisis.

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