Job-Rich Growth: The Answer to Poverty: Job-Rich Growth in the Face of Global Challenges
According to the International Labour Organization (ILO), "job-rich growth" represents a powerful economic development strategy that entails a substantial expansion of employment opportunities and the creation of high-quality jobs. This strategic approach plays an indispensable role in advancing the Sustainable Development Goals (SDGs) and effectively, combats poverty. However, it has been noted by the World Bank that the present rate of job-rich growth is insufficient to eradicate extreme poverty by 2030.
THE ONGOING CHALLENGES OF JOB CREATION
High global unemployment, impacting approximately 25% of the population, carries widespread consequences, including diminished economic productivity and increased strain on social welfare systems. The projection that around 3.7 million young millennials are expected to enter the global working-age population each month from 2020 to 2030, underscores the urgency for job creation and the enhancement of job quality. However, a major challenge in this pursuit lies in the stagnated growth of small and medium-sized enterprises (SMEs), primarily due to limited financial access, which ultimately hinders their capacity for expansion and job creation.
THE KEY SOLUTIONS
The World Bank has identified three critical constraints that significantly impact job creation. Firstly, small and medium-sized enterprises (SMEs), which account for 90% of total employment, often grapple with operational costs that exceed their revenue. To address this challenge, mitigating regulatory compliance and legal constraints can simplify processes, hence saving time and resources. This streamlining reduces paperwork and reporting burden, making SMEs more attractive to investors and lenders. Which, in turn, can result in improved access to capital, increased firm registrations and, consequently, more job opportunities. Secondly, it is integral to prioritize equitable access to education and workforce training. This not only facilitates the seamless adoption of technology but also reduces barriers to trade, offering a significant potential for developing nations. At the same time, ensuring sufficient funding for businesses to enhance productivity is of utmost importance given that half currently lack access to adequate financial resources. Lastly, establishing a conducive environment for large companies to attract private investments is pivotal. These major enterprises play a crucial role in driving innovation and transferring technology to smaller businesses, ultimately leading to the generation of higher-paying jobs and the strengthening of the overall economy.
TECHNOLOGY'S TRANSFORMATIVE ROLE
The prevailing force reshaping the landscape of job creation is technology. Not only does it revolutionize existing job roles, but also serves as a catalyst for the emergence of novel employment prospects. Digital technology, in particular, gives rise to new "gig jobs" through digital platforms, potentially offering fresh and accessible employment opportunities which hold particular appeal to the young workforce. What is even more transformative is technology's ability to stimulate job creation within digital marketplaces. Platforms like Jumia, for instance, directly employs thousands and extends opportunities to numerous sellers, drivers, and logistics personnel. Yet, this transformative shift requires an open public discourse to steer government interventions, ensuring that the benefits of technological advancement are inclusive and provide new forms of work and economic opportunity across all segments of society.
Facilitating access to meaningful employment empowers individuals to invest in education and skill development, promoting economic stability and diminishing the enduring grip of poverty. In our pursuit of a more equitable and more sustainable future, championing inclusive employment remains imperative, ensuring that no one is left behind.
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