Economists from the Makerere University’s School Economics have provided policy options to help mitigate youth unemployment in Uganda.

A team of researchers led by Prof. Edward Bbaale as Principal Investigator assisted by Dr. Susan Kavuma, Peter Babyenda, Brenda Kiconco, Anitah Kyamugaba , Hennery Sebukeera and Nakigudde Claire   under took a research project titled, ‘ “Empirical Review of Youth Employment Policies in Uganda”with technical and financial support from partnership for economic policy Nairobi Kenya funded by Mastercard Foundation.

The study looked at insights from different people on how youth unemployment and under employment can be solved. The research project intended to review the youth employment policies, legislations, interventions and programs with the aim of identifying the best practices for promoting youth employability, productivity, and opportunities among the youth.

The researchers  worked closely with the different  Institutional framework concerned with youth affairs including in the  Ministry of Gender, Labour and Social Development and  the  Uganda Bureau of Statistics, Ministry of Education and Sports, National Planning Authority, Federation of Uganda Employers, National Organization of Trade Unions and parliament among others

The study findings were presented during the dissemination workshop held on 9^th November 2022 at Protea Hotel in Kampala to members of the academia, representatives from government ministries, departments and agencies, the Private sector, civil society organizations, representatives of the youth from different divisions of Kampala and other districts and key collaborators.

The dissemination workshop was intended to validate the findings of the study through contributions, corrections,and an evaluation of the opportunities, challenges, chances, the gaps, costs of and thorough practical policy options with the aim of enriching the report and the policy recommendations in particular to government.

Representing the Principal, College of Business and Management Sciences, the Dean School of Economics and also PI  Prof. Edward Bbaale noted that youth unemployment and under employment is one of the policy issues that warrant due attention.

He observed that Uganda is one of the youngest and fastest growing populations in the world with 54% of the population below 18 years of age and yet the population is growing very fast at 3.4 %.

Bbaale added that Uganda is also faced with a serious problem of high school dropout rate. Data from the Ministry of Education indicates that on average one million pupils that enroll in primary one, only 600 thousand sit the primary leaving examination and this number reduces to 300 thousand at the Uganda Certificate of education and reduces further to 100 thousand to those that go for the advanced certificate.

“The question is where these young men do and women go and who is the messiah. Is TVET, the different skilling programmes the messiah for Uganda? and more broadly even those that graduate at higher level, the question is that whether the problem is at the demand level to the extent that the economy is so much contracted and that there is no space for people to come and take employment meaning that the economy is growing without creating jobs”. Bbaale questioned.

Aware that the services sector is driving growth in Uganda and the agricultural sector is well behind services and industry as far as GDP is concerned, Bbaale noted that this means that there has been sectorial shift in GDP composition- at one time it was agriculture ahead of industry and services but now we have services ahead of the two.

“Whereas we have had the sectorial shifts in the GDP composition, there are no sectoral shifts in employment and majority of our people still depend on agriculture and there is a smaller cake despite its holding 60%  of our people coming with questions of low productivity and poverty.

And so given that, if majority of Ugandans are not employed in the services sector which is leading the GDP composition, can we say our economy is having a jobless profile? We are growing without jobs and then on the other hand, can we say it is the supply side and skills mismatch? Do those people that graduate every year in universities and other institutions match the available opportunities?.Prof. Bbaale questioned.

Prof. Bbaale also stressed that the issue of youth unemployment and under employment is topical and has gone on for sometime but not leading the same in finding a lasting solutions for the youth unemployment problem.

He congratulated the research team for successfully implementing the study and partners – the Mastercard Foundation through the partnership for economic policy in Nairobi for sponsoring  the different activities of the project as well as the stakeholders from MDAs, Private sector,  CSOs and development partners for contributing wonderful ideas.

Unemployment associated with Labor market information system, curriculum design and population growth

The Assistant Commissioner in charge of Youth Affairs in the  Ministry of Gender, Labour and Social Development Kyateka Mondo  thanked the PI and team for putting the research together saying, they are looking forward to receiving what the university thinks is the solution to unemployment question in Uganda.

In addition to addressing the issue of labour market information system, the commissioner observed that it is prudent for training institutions to interface with employers while designing the curriculum but also address the issue of population growth.

“The problem in Africa is that we train today what was needed for yesterday. Are the training institutions in touch with the people who employ? Do you have a time where we interface with the Mukwanos and UMAs of this world and all the people who need the work force?

Second,… we are likely not to break even until we address the issue of population growth. As long as we are producing as if there is no tomorrow. As long as we believe in Genesis that go out there and multiply and fill the world.How are you going to prepare and skill them to get quality education. And the man who tells you to go and fill the world produced only one son –Jesus Christ.”, Mondo stated adding that:

“.. until the population question is addressed and until the training institutions sit together with who is going to employ their products, , there will be nothing new that we are going to hear. The skills given at training institutions do not match the labour markets. So until we move away from the book of lamentations to the book of acts and we act.

Fix the issue of so many children, fix the issue of poverty among our people, fix the issue of a functional and prudent labour market information system. We need action today to bring hope to so many young people in this country but we also have to do mindset deconstruction”. Mondo asserted.

Mondo further observed that over 45 universities are churning out young people every year, operating under a jobless economic growth in that, the economy is not producing the jobs that are badly needed.  He added that if unemployment question is fixed, many other problems like poverty, drug abuse early pregnancies, theft, suicide  would have been fixed.

Formal employment and trends in youth unemployment in Uganda

Presenting the study findings Peter Babyenda noted that formal employment share of government  jobs declined from 6.8% in 2012/13 to 6.5% in 2016/17 while total formal private employment declined from 200,000 jobs in 2012/13 to 141,000 in 2016/17. In 2016/17, only 13,000 (9%) youth had a formal private job.

On trends in youth employment, Babyenda reported  a fluctuating Labour Force Participation Rate –  57% (2016/17), 66% (2017/18), 62% (2018/19), and an  increasing youth unemployment rate – 13% (2016/17), 18% (2017/18), 17% (2018/19)

Babyenda presented worrying statistics on Youth neither in Employment nor in Education or Training (NEETs) estimated at 39%. This is worrying – where are they? He said there are twice young ladies in NEET as men largely found in in Greater Kampala, Northern Uganda and Western region which is a big threat to Uganda’s social cohesion and political stability.

NEETS according to Babyenda are largely attributed to low educational attainment (including among their parents), living in  deprived neighborhoods, low socio-economic status and other barriers to participation like pregnancy or disability.

“The  2018/19 Annual Labour Force Survey report reveals that almost half of the youths (46%) are not qualified for the existing jobs because they do not have required skills.Low wages for youth as the median wage of public sector employees is estimated at UGX 510,000 ($134), while in Private Sector it  is estimated at UGX150,000 ($39).

Existing employment policies seem universal and do not segregate persons in formal and informal sectors in their coverage. More so, there is limited evidence to show the expansion of social protection coverage in the informal sector as required by the National Social Protection Policies. It also remain unclear whether the existing youth employment programs are achieving their targets” Mr. Babyenda reported.

Key findings from the evaluation of the different Youth Empowerment Programs (YEP)

The study indicated that although access to youth employment funds had a positive effect on youth business expansion, there was no significant evidence of the fund’s effect on job creation.

Major stakeholders in YEP were not fully fulfilling their mandates; while on the policy front, the findings show that the youth funds have a long-term impact on its intended goals.

Promoting youth entrepreneurship according to this study should be approached holistically (not just through credit) and should target productive sectors with high employment creation potential.

The need for a strong institutional framework including M&E and accountability frameworks and the removal of barriers to youth self-employment were also proposed.

The study disclosed  a number of challenges faced by the youth involved in Youth Employment programmes and they included ; Misuse of YEP funds, limited follow-ups of beneficiaries due to inadequate monitoring and supervisory capacity, Political Interference, High default rates (failure repay loans/resolving funds) and Poor group formation dynamics

Beneficiaries according to this research, reported delayed release of funds to youth groups or beneficiaries by the ministry of finance and implementing agencies – MoGLSD, local governments, Corruption, Inadequate information on existence of youth, Education miss-match affecting youth employability AND Limited preparation of beneficiaries

The study notes that common youth challenges in Uganda include: Unemployment, underemployment and undignified work.

The study further notes that Uganda has initiated a number of Youth Employment programs over time such as the youth livelihood fund, presidential youth initiatives, youth skilling programs and free vocational education among others.

Many Youth (39%) still either not in School or employment and more among females (50.5%) and the need for specific Policy change to ensure that the youth obtain right skills for existing employment opportunities in the country.

Policy recommendations

The study recommends that government prioritise policies that create jobs and address youth unemployment/under-employment and strengthen the YEP’s Monitoring, Evaluation, Research, and Learning (MERL) system.

The study proposes the development of a clear resource mobilization strategy during the YEP design phase and expansion of YEPs into new locations with updated priority areas.

The policy initiatives should be SMART and should reinforce labour market participation, especially regarding discouraged workers and women.

Other policy recommendations include benchmarking with other countries that have succeeded; Reduce of political interferences in the bureaucratic process of the YEP implementation; Increase budget allocation to YEP and also improve the adequacy and effectiveness of the technical support unit of these programs.

In addition, the study advocates for holistic youth employment policy initiatives as opposed to piecemeal, ad-hoc, under-funded and poorly implemented programs. The programs should be rooted within a wider framework that places structural transformation of the country such as NDP III, Vision 2040, among others.