African govts must ensure job generation: Human Development Report 2014
Although decent and well paid jobs are essential to improve living standards, 40% of workers in Sub-Saharan Africa still live in households earning less than $1.25 (approximately MUR 38.26) a day per person. (Image: Africa Check)
Africa is seeing a growing mismatch between increasingly educated young people and employment opportunities, where youth are more likely to be unemployed, underemployed or employed with reduced levels of job security.
In addition, youth unemployment rates, almost always higher than those for adults, are also more sensitive to macroeconomic shock.
The main reason behind this increasing inequality is that young people around the world are marginalized in the labor market because they lack work experience, social networks, job search abilities and the financial resources to find employment.
These findings were brought to light in the Human Development Report 2014 released by the United Nations Development Programme (UNDP) on July 24, 2014.
The global youth population, which is 1.2 billion, is equal to 17.6% of the world population, where Sub-Saharan Africa has the highest shares of young people in its population with 20.2 percent.
In Mauritius, for instance, the total number of unemployed for the first quarter of 2014 was around 45,300 where as many as 18,400 (or over 40% of the total unemployed population) are aged below 25 years.
Furthermore, there were 9,900 young persons aged 16 to 24 years who were actively seeking jobs as well.
Although decent and well paid jobs are essential to improve living standards, 40% of workers in Sub-Saharan Africa still live in households earning less than $1.25 (approximately MUR 38.26) a day per person.
Also, despite strong productivity growth, real wages have been fairly stagnant, causing the share of workers in vulnerable employment to remain very high in Sub-Saharan Africa at about 77 per cent.
The report makes the telling point that countries enjoying rapid economic progress, such as those in East Asia, have benefited from greater employment investments.
”And they did so even with limited revenues and resources at their disposal,” notes the report.
The report also observes that for developing countries faced with the challenges of underemployment, active labour market policies are not enough, considering that most jobs are in the informal economy— more than 40 percent in two-thirds of the 46 emerging and developing countries with available data.
”Pursuing full employment and reducing employment-related vulnerability in these countries require policies that promote job-creating growth and that extend a social protection framework for all in both the formal and informal sectors,” says the report.
Thus, according to the report, the only way to tackle this issue is for governments to ensure sufficient employment opportunities for young people or face social and political unrest.
”Employment generation programmes can be fully integrated into broader policy objectives, such as building infrastructure and connectivity, using expanded public works programmes, including providing cash for work for the poor and unemployed,” says the report.
Finally, nearly half the world`s working population continues to be in vulnerable employment, trapped in insecure and low-paid jobs.
The report notes that economic insecurity is likely to be high in developing countries, where a large proportion of employment is in the informal economy, lacking coverage from social insurance. In fact, in developing countries in Africa and Asia, the informal sector accounts for 25−40 percent of annual output.
But, the report goes on to note that economic vulnerability is not a problem in developing countries only but due to the slow recovery from the global economic crisis, many people in rich countries face economic insecurity too.
In 2014, for instance, the report estimates that unemployment is expected to be more than 11 percent in France, around 12.5 percent in Italy and close to 28 percent in Greece and Spain, with even higher rates among young people—almost 60 percent in Spain.