Against the backdrop of long-standing structural weaknesses, combined with unfavourable and volatile current conditions in the global economy and a lack of regional economic diversification, the creation of productive jobs in sub-Saharan Africa remains a key challenge, a report by the International Labour Organisation (ILO) reveals.
Output per worker was expected to have grown by “only” 0.5% in 2015, picking up to 1.7% by 2017, although productivity performance varied across major economies in the region.
While above-average productivity growth of 3% or higher had been registered in Ethiopia, Kenya and Tanzania, Angola, Côte d’Ivoire and South Africa posted negative productivity growth for last year.
“Although productivity gains are forecast to improve over the next few years in virtually all the economies of the region, the current figures highlight the difficulty sub-Saharan Africa has had in increasing agricultural productivity and reducing reliance on natural resources,” read the World Employment and Social Outlook Trends 2016 report.
The region’s unemployment rate, meanwhile, moved up slightly to 7.4% in 2015, from 7.3% in 2014.
Unemployment rates for women were estimated at 8.5% in 2015, up from 8.4% in 2014, while, for men, rates were estimated at 6.4% in 2015 and 6.2% in 2014.
“However, unemployment rates in the region are low because broad gaps in social protection force people to work, even if sporadically and informally.
“Instead, employment growth in the region closely follows labour force growth and underemployment is a significant factor,” the ILO reported.
Nine out of ten workers in rural and urban areas were estimated to hold only informal jobs, with the share of informality varying across the region.
Informal employment was lower in Southern Africa, where it ranged from 32.7% in South Africa to 43.9% in Namibia, while, in the other sub-Saharan African countries for which data was available, the percentage exceeded 50% and reached as high as 93.5% in Uganda.
“Unfortunately, most people in informal work are in low-skilled jobs, exposed to inadequate and unsafe working conditions, with inadequate training opportunities, low wages, long working hours and no social protection,” the organisation noted.
Moreover, given the prevalence of informality and the lack of productive employment opportunities, sub-Saharan Africa had the highest global emigration rate.
According to United Nations population statistics, the region had an emigration rate of 1.5% against a global average of around 1%, with evidence indicating that the lack of decent work opportunities – including a high incidence of working poverty and lack of adequate social protection – was a significant determinant of this emigration.
“After leaving school, a striking majority of young people enter the informal economy, while many migrate, looking for opportunities elsewhere.
“The prominence of the informal economy in most sub-Saharan African countries stems from the limited formal job opportunities available to the most vulnerable populations, such as the poor, women and youth,” stated the report.
Sub-Saharan Africa, meanwhile, retained the world’s highest poverty levels and, although poverty had declined in recent years, it had fallen at a much slower pace than in other regions.
The region also had the second-highest income inequality in the world, after Latin America and the Caribbean.
On average, the poorest quintile received 5.9% of all income, while the richest quintile attracted 49%.
Income inequality was highest in middle-income countries and some oil-exporting countries, and it had not declined despite high growth.
“Indeed, higher gross domestic product growth appears to have gone hand-in-hand with increases in inequality, which is partly explained by weak economic governance and a high dependence on commodity exports.
“This is particularly harmful, considering the evidence showing that inequality negatively affects growth and macroeconomic stability over the long term,” the ILO noted.
A more positive achievement for Africa could, however, be found in its rising developing middle-class, with the share of workers earning between $5 and $13 a day reaching 13.6% of total employees, up from 10.1% in 2000.