"Youth must be prepared for the jobs of the future – not the jobs of the past," African Development Bank President Akinwumi Adesina said on Thursday at the launch of the Bank's flagship African Economic Outlook.
"Given the fast pace of change, driven by the 4th industrial revolution – from artificial intelligence to robotics, machine learning, quantum computing – Africa must invest more in re-directing and re-skilling its labor force, and especially the youth, to effectively participate," the Bank president said.
The African Economic Outlook is an annual report that provides updates and forecasts of the continent's economic performance. The theme of the 2020 report is Developing Africa's 'Workforce for the Future.'
According to the report two-thirds of Africa's youth are either overeducated or undereducated. The undereducated share (nearly 55 percent) is considerably higher than in other regions (36 percent).
With 12 million graduates entering the labor market each year and only 3 million of them getting jobs, youth unemployment is rising annually. Youth unemployment must therefore be given top priority, participants heard.
The 2020 African Economic Outlook indicates that skill and education mismatches affect youth labor productivity indirectly through wages, job satisfaction, and job searching. Overeducated African youth earn, on average, 18 percent less than youth with the same level of education who work in jobs that match their education.
Also, youth who believe they are overskilled for jobs are 3.4 percent less likely to be satisfied with current jobs, and as a consequence may be less productive.
The report contains several recommendations for reversing negative trends and creating productive and adequate workforces. These include designing national strategies for education and skills development that include young people, school dropouts, workers in the informal economy, and in economically and socially disadvantaged groups.
Africa’s economic growth has stabilized at 3.4 percent in 2019 and is expected to pick up to 3.9 percent in 2020 and 4.1 percent in 2021 but to remain below historical highs.
Growth’s fundamentals are also improving, with a gradual shift from private consumption toward investment and exports. For the first time in a decade, investment accounted for more than half the continent’s growth, with private consumption accounting for less than one third.
The 2020 Outlook highlights, however, that growth has been less than inclusive. Only about a third of African countries achieved inclusive growth, reducing both poverty and inequality.
The special theme this year is delivering education and skills for Africa’s workforce of the future. Despite progress in recent decades, Africa still lags behind other developing regions in education and skill development. Policy actions should include measures to improve both the quantity and the quality of education and align education policy with labor market needs.
This requires expanding access to schools in remote areas, increasing incentives to invest in education, developing a demand-driven education system that caters to employers’ needs, investing in nutrition to help poorer children, and building STEM and ICT capacity.
To address inequality in education, the Outlook appeals for progressive universalism in education spending—setting high priorities for the poor and disadvantaged and for basic education, where social returns are highest.
New technologies offer opportunities for Africa to innovate and leapfrog in education and training, and many countries, including Kenya, South Africa, and Uganda, are hotspots of education innovation.
The Outlook shows that public expenditures on education and infrastructure are highly complementary, as investing in both has a much greater payoff than investing exclusively in just one. The efficiency of education spending is much lower in Africa than in developing and emerging Asia. The good news, though, is that by enhancing the efficiency of education spending—now at 58 percent for primary schooling—African countries could almost reach universal primary enrollment, without increasing spending at all. Key policies to improve spending efficiency and education quality include conducting education expenditure audits and reviews, improving teacher quality, and using performance based financing. To seize the opportunities and fend off the challenges, African countries must invest in both basic and
advanced job-relevant skills.
In its last part, the report provides short-to-medium term forecasts on the evolution of key macroeconomic indicators for all 54 regional member countries, as well as analysis on the state of socio-economic challenges and progress made in each country. This adds granularity to the more aggregated analysis conducted in the first part of the report.
THEMATIC COVERAGE OF PREVIOUS EDITIONS
Edition Thematic title
2003 Privatization
2004 Energy Supply and Demand
2005 Financing of Small and Medium-sized Enterprise (SME) Development
2006 Promoting and Financing Transport Infrastructure
2007 Access to Drinking Water and Sanitation in Africa
2008 Technical and Vocational Training
2009 Information and Communication Technology across Africa
2010 Public Resource Mobilization and Aid
2011 Africa and Its Emerging Partners
2012 Promoting Youth Employment
2013 Structural Transformation and Natural Resources
2014 Global Value Chains and Africa’s Industrialization
2015 Regional Development and Spatial Inclusion
2016 Sustainable Cities and Structural Transformation
2017 Entrepreneurship and Industrial Development
2018 Infrastructure and Its Financing
2019 Integration for Africa’s Economic Prosperity