Presentation in Lisbon

Promoting

Youth Employment

IMVF December 13, 2012

Outline

I. Context: Africa’s Economic Outlook

II. Stylized facts: What is the employment situation of young Africans?

III. Looking forward: What can be done to promote youth employment?

2

I. Africa’s Economic Outlook

3

4

Africa’s Growth performance 2001-2013

0

1

2

3

4

5

6

7

8

An

nu

al R

eal G

DP

Gro

wth

(%

)

Africa Sub-Saharan Africa North Africa

5

Ethiopia 7.3%

Libya 14.8%

Niger 8.6%

Mozambique 7.7%

Zambia 7.1%

Angola 7.7%

Côte d’Ivoire 7.1%

Ghana 8%

Liberia 8% Rwanda

7.3%

10 Fast-growing economies in

2012/13

External Internal

Macroeconomic policies and

management

Domestic consumer demand

Growth sectors: Mining,

agriculture, services,

construction and

manufacturing

Prices of

agricultural export

Commodity prices, export

volumes

Drivers of Growth

External financial flows

(ODA, FDI, Remittances)

6

Africa’s young population is growing and jobs are not keeping up

7

0

100

200

300

400

500

600

700

800

900

1.000

0

50

100

150

200

250 1

99

1

19

92

19

93

19

94

19

95

19

96

19

97

19

98

19

99

20

00

20

01

20

02

20

03

20

04

20

05

20

06

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07

20

08

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09

20

10

GD

P, B

illio

n (

20

05

PP

P in

t. $

)

You

ng

(15

-24

) P

eo

ple

, Mill

ion

Youth Population Youth Employment GDP (right axis)

II. The employment situation of young Africans

Unemployment is only one of many bad labour market situations for young people

Part-time

Unemployed

Discouraged

Inactive

Student

34%

48%

11%

10% 9%

10%

5%

8%

10%

5% 10%

3% 5% 1%

9% 5%

7% 10%

0%

20%

40%

60%

80%

100%

LIC MIC

Youth time use by Country Income Group (2010)

Employee

Self-employed

Unpaid workers

Part-time

Underemployed

Unemployed

Discouraged

Out of LF

Student

Source: Authors' calculations based on Gallup World Poll (2010)

34%

Stu

dent

s 25

% N

EET

41%

Wor

king

48

%

24

%

28

%

36%

47%

57% 52%

49%

34%

52% 50%

34%

21%

35% 35% 37%

43% 43%

27%

37%

26%

10%

20%

30%

40%

50%

60%

Food insecurity by employment status

LICs MICs Source: Authors' calculations based on Gallup World Poll (2010)

Many youth in work are poor

III. What can be done to promote youth employment?

11

89%

47% 46% 40%

16%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Aggregate labour demand

Skills mismatches

Labour market information

Attitudes of employers and

youth

Labour market regulation.

Demand for labour is the biggest challenge

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Source: AEO Country Survey; 37 countries

Recommendations for Job Creation • Improve access to finance

– Invest in good screening and targeting

– Combine funding with training and mentoring

• Infrastructure

• Social Protection – For informal entrepreneurs and workers

– Take the burden of severance pay

• Provide incentives to hire and train young people. But be careful to avoid displacement

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Recommendations for Education

• Link education systems to employment needs

• A stronger focus on relevant skills is of particular importance for education and training in rural areas.

• Provide opportunities to young people that have obtained skills in informal training to certify them.

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The way forward

The youth employment challenge in Africa is

primarily one of insufficient demand for labour.

1. Demand for labour is the biggest problem

promote job creation in the private sector: help firms

grow and connect to markets

2. Make education more comprehensive and link it

better to the need for skills in the market

3. The rural and informal sectors are opportunities.

Build on them!