Two weeks ago, this paper reported that four cabinet ministers were quizzed by parliamentarians for failure to come up with “practical ways to help deal with the issue of unemployment among the youth.”
The concerned ministers were Jean Philbert Nseingimana - Youth and ICT; Francois Kanimba - Trade and Industry; Judith Uwizeye - Public Service and Labour; and Papias Musafiri Malimba – Education.
Overall, lawmakers appeared to emphasise that although solutions to put young people into employment are on the table, it seems not enough progress has been made. In fact, Jeanne d’Arc Nyinawase, MP, is said to have questioned why ministers did not present statistics detailing the number of unemployed and skilled youth in the country so that the available opportunities claimed by ministers can be scrutinised.
Nonetheless, youth unemployment is not uniquely Rwandan because it is in fact a global challenge that continues to daunt policymakers from rich and poor nations alike. In fact, according to the International Labour Organisation (ILO), even at the current rate of 13 per cent, global youth unemployment is still of concern despite a recent stabilisation. In Greece, for instance, the youth unemployment rate stands at a staggering 50.4 per cent while Spain’s rate is only marginally lower at 43.9 per cent.
Also, of those in work, ILO reports that 200 million of them earn less than $2 a day, which indicates that informal employment, which involves mainly temporary employment, remains omnipresent. In Rwanda, although a lot has been done to try and reduce youth unemployment through schemes such as the Business Development Fund which provides collateral needed by financial institutions to issue loans to young entrepreneurs, circumstances are not particularly different from the rest of the world.
This issue is acknowledged in the second Economic Development and Poverty Reduction Strategy (EDPRS 2013-2018), which highlights youth unemployment as a key challenge facing Rwanda having noted, in particular, high levels of underemployment in rural areas, insufficient non-farm jobs being created, and uncompetitive skilled labour at hand, especially in urban areas.
So, since it is acknowledged that persistent youth unemployment and underemployment are ever-present and carry very high social and economic costs and may, therefore, threaten both the current and future fabrics of the Rwandan society, what practical measures can we put in place to ensure that the unemployment among young people is brought down to acceptable levels?
There isn’t a silver bullet to bring down youth unemployment. In fact, employment economists maintain that to stand a chance of bringing down youth unemployment, the following measures to foster pro-employment growth and decent job creation must be in play: sound macroeconomic policies, youth employability mechanisms, labour market policies that incentivise employers to recruit young people, policies to encourage the attitude of entrepreneurship, and reasonable access to financial services for young people.
Below I briefly discuss two policy options that can go a long way in curbing youth unemployment:
Youth entrepreneurship can be a pathway to decent work for many young people in Rwanda. However, for this policy to become practical, first there must be an enabling environment for starting and successfully operating a business, particularly for young people who aren’t necessarily business-savvy. A helping hand so to speak is necessary to help young entrepreneurs meet the demands of the market place, which experienced business people know are unforgiving.
Making funds available alone will only facilitate the already-polished minds but the majority are likely to be left behind. It is no wonder that frequently we learn of stories of young people unable to come up with business plans yet they poses plausible ideas. You see, when young people gain the ability to become innovative, create businesses, they not only advance their livelihood, they also add to economic growth.
It is also worth noting that entrepreneurial and technical training must, in turn, be combined with adequate access to financial services to help young people during the crucial ‘lift off’ period. The private sector should play a leading role in helping young people transform their ideas into real business opportunities.
Labour-intensive public and private investment
Pro-employment macroeconomic policies, such as labour-intensive investment policies, that support stronger aggregate demand are crucial. Labour-intensive processes where the ratio of labour to other inputs of production is relatively large can play a role in reducing youth employment but also boosting skills. Fortunately, in Rwanda, EDPRS II gravitates towards increasing the domestic interconnectivity of the economy through investments in both hard and soft infrastructure, and if executed properly and sustainably, such a platform can boost the much needed labour-intensive employment opportunities.
However, such investments will be less effective vis-à-vis reducing youth unemployment if the youth are unemployable. To improve youth employability, several actors are required to play their part: First, education institutions must concentrate on the quality and not necessarily the quantity of graduates they churn out of their respective institutions. Second, the government needs to try and improve the links between education, training, and the world of work through social dialogues on skills mismatch and standardisation of qualifications in response to the needs of the market place. Otherwise, we will have all the necessary policies in place but see little change if at all any.
In summary, as stated earlier, youth unemployment is rather a big challenge not just for Rwanda but the entire world, and as things stand there is no silver bullet available to solve the problem. Nevertheless, we cannot afford to let this problem define the future of a section of our society that is so crucial to the future of this country. We all must do what we can, and if necessary, change the way we approach the problem. A lot is at stake to afford to continue recycling ineffective measures.