News & Media / Weak economic prospects: unemployment or informal jobs

Weak economic prospects: unemployment or informal jobs

24 July, 2019

Unemployment is a major challenge for Africa’s youth. This is compounded by a lack of formal jobs and social safety nets.

15.7 million young people in Africa, around 13.4% of the total labour force of 15-24 year olds, are facing unemployment in 2019. This rate is more than twice the unemployment rate of those aged 25 and over (6.1%), underlining that unemployment on the continent is hitting the younger generation hardest. Young women are more severely affected, with a rate of 14.7% compared to 12.3% for young men.

This average continental rate disguises more serious situations in some countries. In 2019, Swaziland has the highest youth unemployment rate, 56%. In South Africa, the economy with the second highest GDP on the continent, 54.5% of young people are jobless, amounting to 1.4 million South African youth. In Libya, Mozambique and Namibia, youth unemployment rates are above 40%. The lowest youth unemployment rates are found in Niger (0.6%), Rwanda (2.3%), Togo and Burundi (both 2.8%).

For 16 of the 19 African countries that have data from 2013-2017, youth unemployment is higher in urban than in rural areas. In only three countries – Rwanda, Sierra Leone and South Africa – unemployment among young people is more prevalent in rural than in urban areas. In some countries, the urban-rural divide for unemployment is quite striking. In Mozambique, the urban youth unemployment rate is 21.3% compared to 1.9% in rural areas. This runs counter to the perception of many young Africans that migrating to urban areas will offer more job opportunities.

Moreover, for many young Africans, the first job hurdle is the steepest. ILO's School-To-Work Transition-Surveys (SWTS) of 15-29 year olds from 11 African countries (Benin, Congo, Egypt, Liberia, Madagascar, Malawi, Tanzania, Togo, Tunisia, Uganda and Zambia) show that for non-working youth, unemployment is the consequence of a lack of jobs, with 32.2% of unemployed respondents stating that the main obstacle to finding a job has been the lack of available ones. In addition, 7% of unemployed respondents consider wages or working conditions in existing jobs insufficient.

On the other hand, the surveys also show that there is a lack of preparation for the transition from education to employment. For 29.9% of unemployed respondents, the requirements for jobs were either too high or they did not have enough work experience, and 13.1% answered that they did not know how and where to look for a job.

In many countries where the informal sector is an important part of the economy, unemployment rates often do not reflect the realities of the labour market. Due to a lack of formal jobs and social safety nets, many young Africans have to find an alternative in the informal sector in order to get by, getting trapped in a precarious employment status which contributes to a delayed transition to adulthood (‘waithood’).

The age-specific data from ILO's SWTS on some aspects of informal work show that more than 1/2 of the employed young people surveyed in each country are working in informal jobs. In seven of these countries, this percentage rises above 80%: Madagascar (92.8%), Togo (90%), Malawi (85.4%), Uganda (83.5%), Benin (81%), Zambia (80.7%) and Congo (80.3%).

The 2019 Ibrahim Forum Report highlights that young Africans lack financial independence. Lack of income is the most prevalent form of deprivation facing young Africans, with 37% of Afrobarometer respondents aged 18-35 having been without a cash income at least 'many times'. According to World Bank data, less than 1/5 of young sub-Saharan Africans (aged 15-24) have received wages in the past year (19.1%), and only 26.4% have their own account at a financial institution.