OBONYO: Support entrepreneurship to reduce youth unemployment in Africa

With a majority of African nations diversifying from traditional sources of income, entrepreneurship is increasingly seen as a key to economic growth. So far, entrepreneurship has yielded huge returns for entrepreneurs and, according to experts, there lies great untapped potential to drive the African continent into its next phase of development.

 

Unemployment around the continent is worrying. According to a recent joint report by World Data Lab, Mastercard Foundation and the University of Cape Town, Africa's youth employment challenge is not simply about joblessness, but about job quality, with millions of young people trapped in low-productivity, informal and poorly paid work. 

 

Africa needs to prioritise youth unemployment. African countries are sitting on a powder keg and if they don’t change, it is going to explode.

 

High youth population, poor policy choices and a lack of comprehensive employment plans in many African nations precipitate the high rates of unemployment.

 

Across the continent, young entrepreneurs are building solutions that address real needs in their communities. Today, entrepreneurship is seen as one of the most sustainable job-generating tools in Africa.

 

African countries should implement entrepreneurship strategies focused on various aspects, including skills development, resource provision and access to markets.

The importance of entrepreneurship is underscored in the World Data Lab's Africa report. Across Africa, the report estimates that nearly 90 per cent of young employed people work in the informal economy.  

 

No doubt, entrepreneurship is one of the key ingredients in the toolbox to address youth unemployment in Africa, the region with the youngest population in the world, with over 70 per cent of its people under the age of 35.

 

As President Obama once remarked, entrepreneurship creates new jobs and new businesses, new ways to deliver basic services, new ways of seeing the world — it is the spark of prosperity.

 

However, many African governments have not been keen on developing policies that would avert unemployment among the youth in a big way.

 

Governments are not doing enough. The private sector is trying, but most goods brought into the African market are from China. This denies the youth much-needed manufacturing jobs, which are more labour intensive.

 

African governments must double their efforts to spur confidence in the continent and enable more young people to turn toward entrepreneurship.

 

Make no mistake, success breeds success — as many entrepreneurs make headway, others get on board.

 

Already, technology-based inventions are pulling entrepreneurs. Also, the mindset has changed and many young people now think as employers. African governments must do more to promote entrepreneurial culture - create opportunities in terms of finance and access to markets.

 

At the same time, governments should create enabling environment to support entrepreneurship that could create jobs for youth.

 

Entrepreneurship, if well managed, can create more jobs on the continent and increase the middle class, which is essential in sustaining economic growth.

 

Governments should remodel their education systems to include entrepreneurship as one of the subjects of instruction in primary and secondary schools and colleges. Also, with the help of the private sector and development agencies, governments should establish information, communication and technology innovation hubs to help entrepreneurs to launch successful startups.

 

Governments should consider giving the private sector incentives through tax relief to create more jobs. Laws and regulations should favour entrepreneurs.

 

Many financial institutions in Kenya expect young people to provide collateral, yet only a few investors are ready to invest in young people’s ideas. Lack of access to working capital has hampered entrepreneurship in many African countries.

 

In addition to contributing to job creation, entrepreneurship can also help the continent to solve some of the social problems that undermine progress. That is why governments should prioritise entrepreneurship as a key pillar of their development goals.

 

Governments must tackle some of the greatest challenges that impede progress, including lack of funds, relevant mentorship and poor government policies.

 

To reap the fruits of entrepreneurship, effective strategies and policies are required to create more employment opportunities within small and medium enterprises.

Targeted support for the self-employed, including access to credit, training and markets, could help transform survivalist enterprises into viable businesses.