Photo: Amir Asor, YBI Entrepreneur of the Year 2011, received support from Israeli YBI member Keren Shemesh
Kickstarting Youth Entrepreneurship:an answer to youth unemployment?
Youth unemployment is a global problem. A recent OECD report reveals that the average rate of youth unemployment in OECD countries is 16% while the troubled economies of Greece and Spain are struggling with youth jobless rates above 50 per cent. In Africa, an increasingly youthful population needs more opportunities to make a living, an issue deemed so relevant to the future development of the continent it was the primary focus of this year’s African Economic Outlook. In the Middle East and North Africa, dissatisfaction caused by high youth unemployment rates have been citedas one of the key underlying reasons for the Arab spring, illustrating the destabilising impact that youth unemployment can have.
In contrast to rich countries where youth unemployment is high, in low income countries most young people do work, out of necessity – in the face of household poverty and the absence of a social safety net. Yet, as set out in the AEO report, in these countries only 17% of working youth (and 7% of all youth) are in full-time employment working for an employer. Most are in effect, self-employed, often working in the informal sector. In reality, most young people in the developing world face little hope of obtaining a job with prospects, and for many, self-employment is the only option.
Getting started isn’t easy. There are plenty of obstacles to overcome, including how to get finance, how to access or develop necessary accounting and numerical skills, learning how to develop business relationships with clients and customers. Many of these constraints are particularly severe for young people. For example, an inability to provide a credit history or other security will hamper efforts to obtain access to capital.
So there is an important role for the development community to play in supporting youth entrepreneurship. Helping young people to earn a living through entrepreneurship can make a crucial contribution to cutting poverty and driving growth. Future innovation and macroeconomic growth will depend on nurturing people with entrepreneurial skills and attitudes.
Photo: After receiving business support from YBI member in India, the Bharatiya Yuva Shakti Trust, Madhuri Khandave now employs 37 people in here tailoring business.
Plenty of initiatives exist to promote youth entrepreneurship and they vary significantly in how they approach the problem. Whether it’s addressing training needs or providing start-up funds there is work being done, but we don’t yet know what works best – especially in different contexts. In establishing a successful development intervention context is critical to impact. That’s why we set out to try and understand better the different economic situations in which donors and other development actors are trying to prime future growth and development. Yet there exists very little understanding or guidance about how context affects impact in practice, or how interventions should be adapted to maximise impact – especially in the youth entrepreneurship sector.
You can read more about the work we have done to identify the different contexts for youth entrepreneurs in this ODI report, where we review the evidence base, develop a framework to assess the binding constraints to youth entrepreneurship in different contexts, and provide a toolkit to guide the design of interventions to support youth entrepreneurship.
We are now consulting experts and practitioners in the field, to help develop and refine the toolkit, asking important questions such as whether the recommendations made in the toolkit in line with their views on the most effective ways of tackling the various different constraints to entrepreneurship?
For more information about our consultation or to contribute, please go to www.yecontexts.org, where you will find the full consultation document, be able to answer some of the questions mentioned above and find out more about our consultation activities.
Karen EllisWikipedia: Karen Ellis was a fictional character in UK soap opera Family Affairs, played by Tanya Franks from 2000 until 2003. →