Africa's Got Work To Do: A Diagnostic of Youth Employment Challenges in Sub-Saharan Africa

Abstract

Sub-Saharan Africa (SSA) is not only the poorest region of the world, it is also the youngest. This realisation is fuelling concern about the youth employment challenge. However, these discussions often lack context, owing to the absence of labour market data and analysis. This article remedies that gap through an analysis of the macroeconomics of the youth employment problem in the low and lower middle income countries of SSA. This analysis concludes that the youth employment problem is just a subset of the overall employment challenges in SSA, which stem from the sluggish pace of the demographic transition—which is why so many youth are coming into the labour market in the first place—combined with slow development of a modern, export-oriented enterprise sector, which leaves the majority of youth entering the labour force no employment option except household farms and firms. In these segments, earnings and productivity are usually low. This has resulted in a large gap between the aspirations of youth (and their parents) and the economic opportunities available. A recognition of realities of the current employment structure and the limited prospects for a major change could bring better focus to current youth employment strategies and illuminate the most promising directions for public and private interventions. In particular, strategies should focus more on how to raise productivity and earnings in the sector where most of the labour force works, instead of just concentrating on the urban wage employment sector.