Dead Sea, Jordan: The Middle East and North Africa (Mena) is facing the highest youth unemployment in the world and it needs to be addressed with innovation and adoption to technology, according to a report released at the World Economic Forum (WEF).
The report “Re-Dynamizing the Job Machine: Technology-Driven Transformation of Labor Markets in MENA,” has been produced jointly by INSEAD Business School, the Center for Economic Growth in Abu Dhabi, and SAP.
With 40 million under-unemployed youth and 27 million not in education, employment, or training, the Mena region has the highest rate of youth unemployment in the world at 27.2 per cent, according to the World Economic Forum. This presents a serious problem for a region where more than half the 369 million inhabitants are under 25.
Technology is widely seen will be a ‘game changer’ in tackling youth unemployment in the Mena’s emerging digital economy. The region has made significant progress in technology adoption with the internet penetration jumping 294 per cent in the region between 2007 and 2012.
Technology is impacting every aspect of labour markets, including better matching of jobs across all sectors, facilitating up-skilling, empowering entrepreneurs, and providing actionable data to decision-makers. The Millennial generation of people aged under 25 are digitally connected as never before, according to the report.
Demonstrating the growing demand for Information and Communications Technology (ICT) jobs, the Middle East’s ICT industry value is expected to reach $173 billion in 2015, more than double the value in 2010, and projected to create nearly 4.4 million jobs by 2020, according to research firm Strategy&.
Mena companies are increasingly generating ‘IT-intensive’ jobs that produce information or knowledge for increasingly digitised business processes, across mobile platforms, cloud-based services, analytics and citizen-centric applications — all of which require new skills.
“New information and communication technologies are indeed creating more jobs in the ICT sector itself in the form of digital jobs and digital entrepreneurship. Yet, the users and beneficiaries of technology need not to be digital experts,” said Bruno Lanvin, Executive Director, INSEAD Global Indices.
“ICTs enable employment in all other sectors of the economy by facilitating job search and a better matching of jobs, facilitating up-skilling, empowering entrepreneurs in diverse sectors of the economy and providing decision makers with actionable data,” said Lanvin.
Online technologies support the process of upskilling as they can reach more segments of society, and allow people to self-educate, according to the report. ICT companies in the region are already actively supporting education for employment initiatives. For example, SAP MENA’s Training and Development Institute integrates ICT in university curricula, and training students and recently unemployed university graduates in ICT skills.
Government role
Governments can encourage and support digital entrepreneurs by removing obstacles, including restrictive legal frameworks, while governments should support incubation centers to educate entrepreneurs and innovators, and provide them with the needed skills and support to help them succeed.
“Governments in the region have a critical role to play in leading national initiatives for employment: putting in place policies; raising awareness and articulating a clear strategy and messaging to enthuse communities; and finally providing an ICT platform where all the stakeholders — especially youth — can connect, massively collaborate and co-innovate to create the jobs of tomorrow,” said Selim Edde, Vice President, Government Relations, SAP MENA.
However, enabling youth employment will require decision makers from government, the private sector, academia, and civil society to collaborate on adapting academic curricula to better integrate ICT learning, upskill students and workers with ICT and e-business skills, and create an environment that encourages entrepreneurship and small-business job creation, according to the report.
