Reminiscing on the small gains Africa had made with job creation efforts including the impact of the work, we do at the Lagos State Employment Trust Fund (LSETF), I am deeply saddened at the rapid economic downturn that has hit most countries on the continent arising from the COVID-19 pandemic. It has set us back on job creation for our youth.
Prior to the lockdown, Nigeria as a Nation was struggling with a youth unemployment rate of 23.1%. Lagos State on the other hand had recently made some progress by reducing the unemployment figures by 6.7% as of Q3 2018. I am concerned that, all this could be lost.
In Nigeria, small businesses are known to create over 80% of the jobs, however, due to this pandemic, some sectors (e.g. event planners that cater to large gatherings; the travel and tourism sectors) where these businesses operate have been badly hit and are going to stay affected even beyond the lockdown.
Some sectors, on the other hand, will gain e.g. the Health sector will require more trained personnel and supplies while e-commerce will need vendors that can provide contactless deliveries.
The entire Agriculture value chain will also require a more skilled labor force especially as diversification is inevitable looking at current oil prices. Therefore, working to create wealth and eradicate poverty for African communities through support for businesses and skills development is critical.
I share my thoughts below on what I believe we should be doing to respond at this time and to ensure we sustain the wins in years to come. Employment creation is a responsibility that should make use of accurate information and data to drive interventions for improved results.
These interventions should also use proven concepts like business support, mentorship, the right investments, and collaboration between as many stakeholders to scale and improve the results.
Knowledge / Information– the interventions must be targeted using the right information.
A technology-enabled and fully automated Labour Market Information System (LMIS), will be able to provide real-time data that can more accurately guide interventions. This system is both useful to the private and public sectors of the economy. The System should be able to generate adequate data that provides the skills required in each sector and is lacking on the market within minutes.
Also making sure unemployed young people have the right knowledge (skills), to take up available jobs is very important for sustainability. This will mean the acquisition of relevant knowledge, skills – both technical and soft. It is beyond reading and writing. These young minds must be exposed to the know-how, as well as the new habits and behavior of the work environment.
Providing the right knowledge cannot be underestimated as a failure to educate with relevant information and skills, limits what can be achieved.
Investments are critical to the success of job and wealth creation and it can be viewed from 2 different perspectives;
Investment in innovative ideas or industries to bring about the scale and thereby creating jobs with the hope of generating some returns/ profit; and
Investment in infrastructure and people to help with the delivery of targeted interventions e.g. a LMIS will require a significant financial investment to originate a robust system that will be beneficial to the overall economy. It is most likely that these investments will not generate financial returns but huge socio-economic benefits.
Studies have shown that mentoring people and investing time in their growth can improve results for both people in waged and self-employment.
Similarly, investing in an idea also gives it validation and has shown to improve the chances of that idea succeeding.
This is a time when small business owners or employees should not be shy to ask for help, in terms of knowing what to do in a state of confusion. They need to be seeking out and asking predecessors, consultants, or professionals for advice.
Mentoring others requires investment, especially of time. What is required is more of coaching others through what is new or they have not been a part of previously. Mentoring can be digital or physical and in this new normal, maybe more digital.
A platform that creates the opportunity for peer and expert support will be useful for business promoters that can make use of IT facilities while in-person mentoring, or support will be useful to the informal sector.
Together, we can achieve more is evident when we examine the strategic partnerships that have emerged as a response to the COVID -19 intervention across many countries. The ability to seek effective partnerships is key at this time.
Here, I do not only refer to just collaboration for business but its relevance for LIFE. The Government can achieve more in partnership with the private sector and vice versa. Critical stakeholders must contribute their ‘strengths’ to achieving a vision of economic prosperity.
A good example of an intervention with job creation potential that can benefit from the multi-sector collaboration is support for the cooperative systems in the informal sector. In more formal finance, we will refer to this as loan syndication or blending to lower risk. This provides access to affordable financing for business development or expansion.
The collaboration includes aggregating other businesses in the same sector to deliver on a project that requires volumes one business cannot deliver alone e.g. mass production of masks, face shields, and other Personal Protective Equipment (PPE) for Government facilities.
To quickly and strategically ramp up on youth employment across the continent, it is critical that interventions are guided by real-time data as this will help to minimize waste of resources. However, real-time data will require some form of investments in people, business and critical infrastructure. To reap the benefit of these investments, it is important to empower people with the right knowledge and skills. Also, we must promote a blended mentorship approach (digital and in-person) to ease individuals into the job market and help small businesses build or thrive in this economy.
Furthermore, one of the most effective tools to foster these interventions is collaboration, where different entities can put together the right resources to scale the identified intervention for greater impact.
Overall job creation should continue to be the objective for any Agency or Organization like LSETF solving unemployment and should drive how we proceed in this unprecedented time where it is no longer business as usual.
Article written by Teju Abisoye, Acting Executive Secretary, Lagos State Employment Trust Fund (LSETF)