NATION AGENDA: To create jobs, state must work with private sector


Support for MSMEs, especially in identifying opportunity and scaling start-ups would create jobs.

Precise data on unemployment problem is difficult to come by.

However, a reliable estimate can be made from disparate data to provide an unsettling magnitude of the challenge facing the country.

The number of youth entering the market is anywhere between 700,000 and 800,000 considering that an average 950,000 sit for KCPE exams annually and 700,000 proceed to high school.

This provides for a transition rate of roughly 80 per cent, with at least 200,000 youths joining the ranks of the unemployed.

In Kenya, those who proceed to high school are considered lucky.

This is because the alternatives are few, mainly poorly resourced village polytechnics that offer an archaic curriculum.

Similarly in high school, of the average 570,000 who sit the KCSE exam, about 200,000 proceed to university.

A further 150,000 join middle-level colleges, leaving an equal number scavenging for the few remaining jobs.

A further 30,000 graduate from the universities – local and foreign – and enter the labour market every year.

Different research shows that between four and seven out of 10 either enter into formal employment or the informal sector.

Therefore, on average the youth unemployment rate can be estimated at 40 per cent, which is about four times that of the overall national unemployment rate of 10 per cent.

A recent pronouncement by Sicily Kariuki, Cabinet Secretary for Youth and Gender Affairs in the Ministry of Public Service, that 80 per cent of the unemployed Kenyans are below age 35 and that 90 per cent of them have no skills highlights the enormity of the challenge facing the country.

Several intervention by the government like the Kazi Kwa Vijana, Uwezo, Youth and Women Fund, Access to Government Procurement Opportunities, and Enterprise Kenya have either failed or are failing due to lack of initial feasibility studies, bureaucratic red tape, poor monitoring and evaluation, as well as general youth apathy.

There is a complete disconnect between what policy makers want to achieve and what the youth want.

Unlike other parts of the world where the youth unemployment is under control, most decisions in Kenya are driven by politicians with little or no input from other stakeholders, including the youth themselves.

The academia is rarely invited by either government or industry to inform this process with research findings, yet it is this triple helix (government, industry and research) that drives economic development across the world.

Several research papers on Micro Small and Medium Enterprises (MSMEs) are produced in Kenya annually but they have no bearing on what happens with policy or industry.

Support for MSMEs, especially in identifying opportunity and scaling start-ups would create jobs.

The practice, however, is to let entrepreneurs decide what they want to do and it often leads to a replication of what exists hence the high death rate of MSMEs.

There is no doubt that MSMEs are key to economic and social transformation.

However, there is not enough support to make the sector more productive and provide more meaningful jobs as well as becoming responsive to other obligations like tax.

On paper, many of the interventions by the Youth Fund are great and pre-determined. In reality, they have limited creativity and innovation.

It is perhaps why the impact has not been felt on the ground and challenges persist.

This challenge, however, is surmountable. But first we must assume that the youth need guidance on what they want to do.

It is for this reason that governments across the world are putting up makerspaces, incubation hubs and co-working spaces where young people collaborate and share ideas that produce innovative products.

Our assumption that giving youth money will create entrepreneurs is misguided.

Productive entrepreneurs are either born or taught how to dynamically become one. There are no other ways.

Entrepreneurial education, incubation and collaboration will encourage entrepreneurs to embrace innovation and develop enterprises that are competitive, saleable and sustainable.

As it is at the moment, several informal enterprises can be made to become global enterprises.

For example, the low hanging fruit in furniture making require the injection of technology for the industry to take off.

The industry needs a mindset change from subsistence enterprise to globally competitive enterprises.

This is because mass production of furniture in places like China is becoming less competitive.

Secondly, we need to reform our education system to not just orient students towards entrepreneurship but its quality and relevance.

The mantra on the lips of every parent advises children to get a good education that will give you a job yet we know that these jobs are not there.

There is need to put more emphasis on Science, Technology, Engineering and Mathematics (Stem) as other many successful countries have done.

This is not to say that we ignore arts subjects.

It is simply a recognition that without stem skills, even in art you may not succeed.

For example, to register for business in Kenya or filing taxes and many other services, you need to understand technology to succeed in conducting business online.

In South Africa for example, successive governments have heavily invested in enterprise incubation but they are experiencing problems with respect to readiness to undertake training due to an educational system that does not prepare students for math.

While there are many technology jobs after training, the students are not trainable because they took math literacy in high school instead of pure math.

These are carryover problems from the apartheid period when blacks were only taught math literacy just to make them functional in society.

Thirdly, and in line with my first proposition, we start with the premise that the youth, especially those dropping out of primary and secondary, do not know what they want.

We need to compulsorily provide them with skills in areas of their propensity to succeed.

All dropouts in primary and secondary school should go through a three-year compulsory vocational training at the National Youth Programme.

After graduation, such youths should be contracted to the private sector for internship as a strategy to bridge the existing gap between what industries want and what the educational system provides.

Before moving to set up their own enterprises, academic institutions should assist them with opportunity recognition and Business Development Services.

Lastly, there is need for continuous research to scan for opportunity globally, inform policy for appropriate interventions and industry to take advantage of emerging opportunities.

More importantly, the mindset of regulators who often stand in the way of innovation to embrace smart regulatory regimes needs to shift.

The delicate balance between consumer protection and innovation should pay enough attention towards the enablement of employment expansion and inclusive enterprise models, perhaps starting with low hanging fruits in transformative sectors like the ICTs.

Reports, including one by McKinsey, highlights the transformative power of the web in Africa, emphasising that the digital revolution will likely play out in the following sectors: financial services, education, health, retail, agriculture, and government creating hundreds of thousands of jobs.

The requisite digital skills and competencies to make sure these figures have more meaning than just being numbers in a document, are crucial.

These numbers mean value chains established, jobs created, businesses set up.

Thankfully, a number of private citizens are seizing the initiative.

One that immediately stands out to me is a corporate one – Google.

Through its Digital Skills programme, it is giving means to Africans to create economic growth in the sectors previously highlighted above.

The internet giant has pledged to train one million in a year and has reached the halfway mark, with 500,000 Africans already trained in digital skills.

These young people are “hungry” enough to create change for themselves and their communities.

Many of these people are looking to build web tools and apps for businesses.

Out of this crop of trained Africans, small and medium businesses will undoubtedly sprout.

Some may not secure local employment but with skills, they will become useful to not just in neighbouring countries but across the world.

While Kenya battles with the youth bulge, the reverse is true in parts of Europe and the Middle East.

In these areas, the majority of the population is older, meaning that they have an inverted population pyramid, and are compelled to ‘import’ labour into their countries to carry out a variety of critical tasks.

The government should proactively develop policies to assist young people whose skills are in demand outside of the country and support them accordingly.

Further, a conducive policy environment should encourage inclusive enterprise models such as social enterprises.

One of the well-known social enterprises is the Digital Divide Data (DDD) that has leveraged a new concept, impact sourcing within Business Process Outsourcing that consciously employs workers from within populations that are marginalised, disadvantaged and a minority, as a way of responding to global development challenges and business outsourcing needs and effectively dealt with issues of inclusivity.

The enterprise has more than 500 youths in this work-study programme that will see most of the graduates receive college degrees in addition to experience and assistance to secure professional employment.

To succeed in dealing with unemployment problem in Kenya, the government, private sector and academia must work together in skilling and re-skilling of young people who, more than likely, may not be in a position to determine their future without close support and monitoring.

Contributors: Dr Bitange Ndemo, David Aduda and Brian Okinda.

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