Improving youth employment to start a virtuous cycle in urban development

In the late 1990s, I lived in Bissau, the capital of Guinea-Bissau. It was shortly after the end of the civil war that had taken place there. The economy was hardly recovering and in the city, there was a great deal of nihilism amongst young people. They would party, drink themselves into a stupor, snort cocaine, or have unprotected sex. They did not see a future for themselves, so, they were escaping in hedonism. A dark place to be indeed.

In many developing countries, young people struggle to integrate into the labour market and find decent employment. According to the International Labour Organisation, developing countries deal with chronic high rates of youth unemployment and underemployment, reaching 60% or more in some countries in Sub-Saharan Africa, leading to high rates of youth working poverty rates, at almost 70% in 2016. The World Bank tells us that youth unemployment in this region is expected to grow by 42.5 million between 2010 and 2020.

We know from experience that providing education and skills is not sufficient enough to create decent employment for young people. Many employers are unwilling to hire young people, even if they’re skilled, as they have a negative view of these young people. To respond to this situation, SNV developed its Opportunities for Youth Employment (OYE) approach, building on our decades-long expertise to develop commercial value chains that are inclusive for young people, smallholder farmers, producers, women, and those marginalised and at the bottom of the pyramid.

In partnership with Mastercard Foundation, our first OYE project started in 2013. It is aimed at under-privileged rural young people in Rwanda, Tanzania and Mozambique. Today, we are on target to reach our project goals and create direct and meaningful employment for 18,500 young people by the end of July 2018.

The starting point in the OYE programme is the marketplace. We utilise our knowledge and contacts with local businesses; and identify labour needs and business interests, in sectors that are attractive and profitable for young people. These include horticulture companies, solar PV installation services, biogas digester construction and advanced clean cookstoves production. If there is a need for labour in a particular market, we select young people and provide tailored programmes to equip them with specific skills and competencies that will enable them to thrive in selected opportunities. The trainees enter apprenticeships to complete their technical and vocational skill training at the companies. We also create access financing options through youth saving and lending schemes. After OYE applicants have graduated from our training programme, and entered employment - either at a company or through entrepreneurship, we continue to mentor and coach them, to sustain their continued success in the workplace.

In an increasingly urbanised world, the need for meaningful youth employment for these young people from the slums is tremendous. The flurry of young men and women, sometimes children, passing in between the waiting cars at traffic lights and crossroads in cities around the world, is an image many will recognise. All day, they try to sell fruits, cigars or other paraphernalia. They live from day to day on small incomes they are able to earn, and with little prospect on a better future. They lose hope and see no way out. The effects are not just economic but also social. Many young people living in slums, are recruited by gangs, as they see it as viable way to earn money, and create a future for themselves. It leads to violence, unrest and parallel systems of power that enforce taxation systems on the people living in slums. At the same time, cities are and will always be the hubs of economic activity. The chances to create employment are endless and the concentration of people creates a ready consumer market for services and products.

Our OYE approach can be readily translated to the urban environment. In May 2017, SNV and partners started the Livelihoods Improvement for Women and Youth (LIWA) project - the first youth employment project in the urban context to utilise the OYE method. The LiWay project aims to improve the lives of at least 200,000 people in Addis Ababa until the end of 2021. Building on the knowledge of the implementing project partners and local service providers, we target companies in the manufacturing industries located in the city to create demand for skilled labour. Working with these companies, the project will provide selected young people with the necessary training to fulfil certain positions and enter meaningful employment.

Providing young people with decent employment naturally has great economic benefits. Many go on to use the skills they learned during the programme, and to build successful enterprises for themselves. Time and again we hear about their future plans and their dreams to continue to grow.

The benefits of decent employment are far larger than economic only. Maybe most importantly, young people who have successfully completed our programme, dare to dream again. As their income grows, their ability to take care of themselves and their family increases significantly. Their children can attend school. An increased income leads to improved food security and allows them to improve them their nutrition and sanitation status.

Providing decent employment for young people in slums, is key to unlocking and addressing the challenges of urban development; as it will increase not only the economic purchasing power of people in slums to access services, but it will have much larger social benefits. Youth employment can be an economic turnkey to reduce social and gender inequality.