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The digital economy in Africa is becoming more inclusive

The digital economy in Africa is becoming more inclusive

Africa’s economies are growing at an unprecedented pace—and so is its youth population. Job creation is not keeping up with the youth bulge: By 2050, 400 million people under the age of 25 will be in need of sustainable employment if the continent can expect to continue along its growth trajectory.

The rise of the information communications technology (ICT) sector—as well as the adoption of business outsourcing practices that intentionally hire underemployed demographics such as youth—provide a clear opportunity to right the course.

From the cotton gin, to the tractor, to the assembly line and beyond, jobs have faced and will continue to face threats from technological advances.

But throughout these disruptions, large-scale unemployment has typically been avoided: either machines could not do many of the innately human things people could do, or technology so drastically brought down costs that new markets were unlocked, in turn requiring more workers to serve new customers. Today, both these factors are playing out across sub-Saharan Africa.

Greater internet and mobile penetration, the development of online market places, and changes in user and consumer behaviour are creating technology-enabled business models across the continent. It is precisely at this juncture that technology can be used to create job opportunities for Africa’s burgeoning youth population.

New forms of working are required

With youth unemployment in major African economies such as South Africa and Nigeria reaching upwards of 50%, new forms of working are required to meet the needs of a worryingly inert labour force. As traditional jobs become scarcer in increasingly competitive job markets, the digital economy can support the livelihoods of entrepreneurial individuals seeking to provide services to new customers in new ways.

A growing body of evidence is highlighting the job-creation potential of the digital economy. Since mid-2013, Uber has created in South Africa over 4,000 economic opportunities for driver-partners. The firm states that 1,000 such opportunities were created in both Nigeria and Kenya since launch around two years ago, and it forecasts over 3,000 more for Nigeria in the next year.

Despite these risks, for the millions of struggling work seekers throughout sub-Saharan Africa, perfect employment should not be the enemy of a good living. As smartphones and data become more affordable, and more people become digitally literate, the growth of digital livelihoods across Africa is inevitable.

Eliminating various tech and non-tech barriers is crucial to making the digital economy more inclusive. For example, zero-rating job sites so users are not charged for data costs as China Mobile does in China.

Municipalities can also help online workers avoid challenges of poor connectivity and unreliable power by creating and supporting business and tech hubs for digital entrepreneurs. Ghana, Nigeria, Kenya, and a host of other African countries are building these ecosystems with increasing government support.

Change of the conception of work

According to workers and policymakers there are good reasons to worry about the impact of technology on jobs. Yet if history is any guide, harnessing the power of new technology to reach new consumers will present tremendous opportunities for digital work and entrepreneurship. But to realise these opportunities our conception of work must change, if the work itself is to follow suit.

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