(DireTube Article, Addis Ababa) — Among widespread problems of our nation, today are youth unemployment on the one hand, and the recurrent inflation on the other. Especially, the latter would be worse if the former could not address well. Job creation is a pivotal homework to be discharged, if so, it leads to the creation of wealth and fair distribution of country’s resources, more importantly to youths, the turbine of economic growth, according to government’s policy.
These days, especially in cities like Addis Ababa, you see an overwhelming amount of youths unemployed, seeing for vacant positions on billboards, newspapers in areas like Arat Kilo, Piassa, and Legehar, just to mention a few.
One of the most divisive issues for politicians vying for office across the world is the question of jobs. The point of creating well-paying jobs has been a primary concern for those in economic management as well. With fast and sustainable economic growth for the past dozens of years mainly in the agricultural sector, poverty and unemployment are increasingly becoming an urban problem in Ethiopia. And with that, a well-functioning labor market in urban areas is becoming a necessity to the second most populous nation in Africa. Accounting for 18 percent of the overall urban population, Addis Ababa is at the forefront of most of the challenges in urban Ethiopia. Recent studies, however, are founding out that the city’s labor market is highly inefficient to accommodate the growing work force.
Ethiopia at large is seeing a soaring rise in the number of its educated youth that it had not witnessed 20 years ago.
Ethiopian universities are over 30 with an annual alumnae’s of over hundreds of thousands, every year; despite the absence of vast fresh vacancies to host those new active job lookers. Where do all they have gone so far, then? That should be a major question the government is expected to address it well for the reason that high youth unemployment rate has both economic and political implications in a young-dominated country like us. It could be the source of a recurrent nightmare for anyone who chooses to hold the mantra of leadership.
The country, predominantly agricultural country with over 85 percent of people are residing, though it is more at a subsistence level with the increase in family size and pressure from ever enlarging population, the family land size is shrinking, unable to support millions of youth desperate to find a means of livelihood. Neither is the national aspiration for the structural transformation of the economy to industrial-led has reached its momentum. Despite encouraging signs of growth in the manufacturing sector, whatever is there on the ground is too insignificant to absorb the workforce in the youth population.
With an aim that seems to curb last year’s unrest in Oromia, Lemma Megersa’s administration has given a land for youngsters in the region, but without adding any value to it. How could youths manage to exploit that as their source of income? What should be the role of a region in particular and the government? No clear cut leeway has installed so far. Amhara and Tigray regions too did likewise.
Given the current unemployment in the country, youths are forced to be dependent on their families and guardians despite the ever-skyrocketing cost of living.
High and persistent unemployment has presented a major challenge for the welfare state from two directions, wrote Peter Saunders in his “Direct and Indirect Effects of Unemployment on Poverty and Equality”.
First, he argued that it has eroded the funding base and second, it has increased the demands on welfare programs because of the consequences for poverty and inequality resulting from high unemployment.
He explored the latter effects of using a range of national and international evidence. He argued that the effects, while basically presumed to exist, are complicated by how poverty and inequality are measured (by the economic status of families) and the growth in dual-earner families that has weakened the link between the economic situation of families and individual family members.
Despite this, there is strong evidence that unemployment increases the risk of poverty and contributes to inequality, and that it also gives rise to a series of debilitating social effects on unemployed people themselves, their families and the communities in which they live. This suggests a need for welfare reform give emphasis to employment generation, but this should not be the only outcome by which the welfare system should be evaluated.
For instance, the World Bank’s report on Ethiopia stipulated that Addis Ababa’s labor market is suffering from wage inflexibility and lacking the ability to absorb the excess supply of labor in the market.
According to the report, wages in low-skill requiring jobs are already too small to decline any further to clear the excess labor force supply and thus resulting in high level of unemployment. That could be observed among the disproportionate low-skill workers in the city, the report claims. And what is driving this is the extremely low productivity of low-skill workers in Ethiopia.
The provision of an adequate and secure safety net that does not unduly distort incentive structures is also an important welfare objective.
The government has adopted various initiatives in the past two decades to address youth unemployment, which has been a concern for any administration. Over ten years ago, the federal government adopted a strategy aimed at providing financial supports to micro and small enterprises, whose officials reported they had created over 10.5 million jobs in the first Growth and Transformation Plan period.
Little should this be surprising if this fact consumes the political elite with constant worries on the absence of schemes that keep the youth busy, if not engaged in a meaningful way. An army of unemployed youth is nothing but a political time bomb.
Meanwhile, the perspective of the ever-growing youth population focuses on the life quality of the individual and other opportunity structures that influence the development as well as life chance of individuals, which should be the basis of urban development planning and policy choices. The problems and challenges of youth bulge cities and towns require a holistic view that crosses the border of sectors youth bulge effects cover different life domains (health, education, employment, housing, and transportation). Youth population life moves between the various sectors and spheres which require an integrated approach.
The fundamental of urban area study planning is difficult to go away of. Sectorization and specialization are old related to the society’s division of labor and need for accountability. The drawback is that a too far driven sectoral approach impedes actors to cooperate on a holistic solution to youth bulge effects.
Sustainability of youth bulge cities and towns requires holistic view in addition to the traditional sectoral approaches to urban development.
Comprehensive view explores ways of developing the sound governance structure which enhances co-operation between the key stakeholders from the public and private sectors youth and professionals in the building sustain bale youth bulge urban centers the question is do we have an attempt to break the sectoral approach and initiate long-term integrated vision that crosses the border of sectors?
An important policy strategy question concerning youth bulge cities and towns is on measures aimed at controlling and stemming rural-urban migration, which is the primary source of youth bulge explosion in urban centers. The pattern, trend, and characteristics of migration-led urbanization in Ethiopia calls for program & strategy that are focused on rural industrialization. To absorb the surplus rural labor into a wage based productive economy and to avoid uneven and unbalanced growth of towns, there’s a need for rural industrialization in Ethiopia.
Rural industrialization is concerned with the spreads and growth of small-scale and cottage industries in the countryside, according to Chris Brammal (PhD), Professor of Economics at University of London.
Chris, in his study entitled “The Industrialization of Rural China” revealed that the experiences of high population density countries such as China and India show that small-scale industrial sector has vast potential concerning creating employment & output. Small-scale manufacturing industries have the capacity to absorb surplus labor and provide productive employment owing to their growth character.
There are two approaches to rural industrialization. The first, rural-industrialization is the spread of manufacturing jobs and enterprise management from the main cities to rural towns, which is called “Exogenous Model of Rural Industrialization”.
The second approach emphasizes settling-up of industries based on agricultural local resources and skills since economic capacities of a given country may not ensure the expansion of urban industries to rural areas. This model, which emphasizes the unique rural character, is called “Endogenous model of rural industrialization.”
To me, it doesn’t matter whether industries spread from urban to rural areas or be based on countryside local resources catering local demands. What is important is the creation of productive employment for the surplus rural labor in the nearby towns as well as supply of consumption goods to the rural households.
The conditions of youth bulge in the country require industries as decentralization (relocation of manufacturing industries to medium and small towns) to bring about balance growth and absorb the rural surplus labor in its proximate location (to curb long-distance migration).
There are two policy strategies as well as tools that matter most for sustainable development of youth bulge issue in cities and towns; first, thinking of holistic view that crosses the border of urban sectors, that needs to be a plan that enhances co-operation between stakeholders including the youth.
Second, there need to be a program for the promotion of rural town based small-scale manufacturing industries, which are not only more labor-intensive but also more productive per unit of scare capital than their large-scale counterparts in capital cities.