Africa has more people aged under 20 than anywhere in the world and the continent could be sitting on the greatest economic asset of our time.
The phenomenon of a very high number of young people compared to a country or continent’s ageing population is known as a youth bulge, and is common in countries where the infant mortality rate has been reduced, but women still have high fertility.
According to the World Bank, in a country with a youth bulge, if the number of working-age individuals can be gainfully employed, the level of per capital income should increase, making the youth bulge an economic dividend.
However, if young people can’t find work, the bulge becomes a bomb; a potential source of political and social instability. For an example of the destruction a “youth bomb” can cause when it detonates, look no further than Egypt, an “Arab Spring” country. Daniel LaGraffe of George Washington University argues that the impact of poverty and unemployment on Egypt’s youth played a major role in that country’s violent transition. The same is true of Tunisia and Libya.
Currently, the youth account for 60% of all African unemployed. In North Africa, the number stands at 30%, but it’s even higher in sub-Saharan countries such as Botswana and South Africa. However, these stats mask an even bleaker reality: Those who have work are underemployed in low-paying, unreliable jobs that often don’t match their education level.
Africa’s youth bulge does have the potential to boost the economy, and though leaders have tried to intervene (for example, Nigeria introduced a business plan competition that grants winners start-up capital etc.) the impact of their initiatives is unclear, and experts are calling for stronger job-creation mechanisms. The International Labour Organisation (ILO) suggests youth entrepreneurship.
Aeneas Chuma, ILO’s regional director for Africa, believes decent jobs for are critical to address instability. To create them, though, youth entrepreneurship must be encouraged, as successful SMEs capture growth opportunities and generate wealth, and, so, create employment.
Many Africans are already entrepreneurs, but on a subsistence level; the goal is to put food on the table from day to day as a matter of survival, not stimulate the economy. Yet, that innovative spirit exists, and the path to prosperity can be illuminated by more focused support from governments and the private sector.
The Standard Bank Incubator, for example, has provided more than 100 South African start-ups with support in the form of training, mentoring and access to technology with the long-term view to expand further into Africa.
Together with ambitious young Africans, we can move the continent forward.