Africa's Employment Challenges: The Ever-Widening Gaps

Abstract

The number of jobseekers will continue to rise sharply in the coming decades. Worryingly, developments since 2000 tend to offer less hope for improvements in the labour market. Almost all indicators point to a deterioration of the current situation. 2. The previous growth model of jobless growth and growth with increasing informality is exacerbating the situation on the labour markets. It is time to reverse the trend towards greater inequality and worsening employment for the overwhelming majority of Africans. 3. The climate crisis is exacerbating employment problems on the continent. Measures to combat the consequences of climate change must therefore be set in motion, especially in combination with steps to tackle the job situation. It is time to reverse the trend towards rising inequality and declining employment for the overwhelming majority of Africans. The drivers of hope - foreign direct investment (FDI), Chinese involvement, open trade, digitalisation, the green revolution, more education and further urbanisation have not proven to be sustainable. Not least because FDI in the commodity sectors and industry is capital intensive and has little impact on employment. However, in most countries, this solution is strongly favoured by African governments and the power elites, who benefit from FDI as a source of tax revenue and income for their administrations. There is a critical need for reform. What matters most is that FDI and value chains increasingly integrate local entrepreneurship. There must be a focus on endogenous development: promoting local industry can lead to higher productivity growth and create more productive and better-paid jobs. To harness the employment potential of agriculture, it needs to move towards market-oriented and integrated food systems. Local demand for jobs can be increased by companies increasing their exports abroad and successfully replacing imports of simple consumer goods. This study emphasises the need for an accelerated and climate-friendly economic transformation in SSA to create more and better jobs.