Unemployment: There is light at the end of the tunnel
Jun 20, 2011
THe recent launch of the Job Stimulus Programme through which the youth will be trained and then given a hand-up fund for entrepreneurship could be one of the most important developments in Uganda this year… and for many years to come.
THe recent launch of the Job Stimulus Programme through which the youth will be trained and then given a hand-up fund for entrepreneurship could be one of the most important developments in Uganda this year… and for many years to come.
The programme, worth sh44.5b and targeting job creation to alleviate the problem of unemployment especially among the youth, was launched a few days ago by the First Lady, Janet Museveni in Bunyoro during the regional Job Convention for Bunyoro in Hoima town.
If we were looking for development catalysts around these parts, then this is surely one of them because it is not only a timely answer to a felt need; but also apparently learns from the past where as a nation we have stumbled.
Unlike the Entandiikwa scheme in the 1990s which ran aground because many people either failed or simply refused to pay back the money into the revolving fund, this new project emphasizes three things—proof of savings and then acquisition of entrepreneurial skills as a prerequisite to the third, funding.
One will not simply walk into a Government facility, fill in forms, sign here and there and then smile as they make for the bank. It is all a process, and a fairly unhurried one, meant to ensure that this facility is not abused. Government would like to see a culture of saving established in Uganda; especially given that one of the reasons countries like Japan grew very fast was because of a high rate of domestic savings. So one must first save, receive training in his desired field of business and then later access the funds. So this is by no means a quick fix.
In fact the only quick thing about it is that unlike some projects that take long to take off, this one is already off the ground barely a fortnight after the national budget was read. Usually for many countries, it is tax increments that take off very quickly. But on this project Government has wasted no time in launching into the deep, thereby underlining its seriousness and intent to fight poverty and unemployment. Business primarily means two things: jobs are created and income is generated. And that is precisely what creates social safety nets for people so that as Government focuses on providing a solid macro-economic policy, the right institutional and legal framework for the private sector to grow, the private sector creates its own jobs. This is in part, because in strong economies, direct job creation is not a primary function for any government; it is the private sector that must create jobs. In Uganda’s case the civil service has only about 300,000 jobs, give or take a few, but the tertiary institutions produce almost the same number every year! That means the way forward is for people to venture into private enterprise and leave the public sector to a small minority that is responsible for administration and regulation.
The timeliness of this Job Stimulus Programme is spot on. About 75% of Uganda’s more than 30 million people are 35 years and below. Of these about 80% are unemployed, a statistic which is as harsh as it is dangerous. Harsh because it means that only one out of every five young people is able to participate meaningfully in the economy by way of productivity. The rest are consumers; but some of them may not be serious consumers at all because unless they have other people – friends or family – to depend on, it means they have very little or nothing to live on. And it is dangerous because whenever you have too many youth bustling with energy but with no forum to use that energy meaningfully then you are asking for trouble because they become vulnerable to whoever offers them a glimmer of hope.
As things stand now, although the country has impressive economic growth rates, part of the sad reality is that many Ugandans have for a long time been locked out of the actual economy because they lack opportunity for venture capital. So a lot of the Gross Domestic Product is produced by the people who have got jobs or capital, or both, while those who have nothing survive on the periphery.
The sheer prospect of more people participating in the economy should be considered great news for this country, because even with the current inequality in active participation in the economy, Uganda has maintained its ranking among the fastest growing economies in the world. This suggests that if this new programme is handled well, and the government maintains its macro-economic policies that are responsible for the current ‘bubble’, then many more Ugandans will be able to realize an improved standard of living.
With time, this programme should also change the paradigm of employment that many of our people have: that of wearing a tie and sitting behind a desk and issuing orders.
Employment should now take on a new meaning—deploying your energies and talent into an undertaking of your choice, doing your own thing and using it to generate revenue. But like any Government project, this one will only make sense if we all get behind it as a nation, to support both government and the young people.
The programme, worth sh44.5b and targeting job creation to alleviate the problem of unemployment especially among the youth, was launched a few days ago by the First Lady, Janet Museveni in Bunyoro during the regional Job Convention for Bunyoro in Hoima town.
If we were looking for development catalysts around these parts, then this is surely one of them because it is not only a timely answer to a felt need; but also apparently learns from the past where as a nation we have stumbled.
Unlike the Entandiikwa scheme in the 1990s which ran aground because many people either failed or simply refused to pay back the money into the revolving fund, this new project emphasizes three things—proof of savings and then acquisition of entrepreneurial skills as a prerequisite to the third, funding.
One will not simply walk into a Government facility, fill in forms, sign here and there and then smile as they make for the bank. It is all a process, and a fairly unhurried one, meant to ensure that this facility is not abused. Government would like to see a culture of saving established in Uganda; especially given that one of the reasons countries like Japan grew very fast was because of a high rate of domestic savings. So one must first save, receive training in his desired field of business and then later access the funds. So this is by no means a quick fix.
In fact the only quick thing about it is that unlike some projects that take long to take off, this one is already off the ground barely a fortnight after the national budget was read. Usually for many countries, it is tax increments that take off very quickly. But on this project Government has wasted no time in launching into the deep, thereby underlining its seriousness and intent to fight poverty and unemployment. Business primarily means two things: jobs are created and income is generated. And that is precisely what creates social safety nets for people so that as Government focuses on providing a solid macro-economic policy, the right institutional and legal framework for the private sector to grow, the private sector creates its own jobs. This is in part, because in strong economies, direct job creation is not a primary function for any government; it is the private sector that must create jobs. In Uganda’s case the civil service has only about 300,000 jobs, give or take a few, but the tertiary institutions produce almost the same number every year! That means the way forward is for people to venture into private enterprise and leave the public sector to a small minority that is responsible for administration and regulation.
The timeliness of this Job Stimulus Programme is spot on. About 75% of Uganda’s more than 30 million people are 35 years and below. Of these about 80% are unemployed, a statistic which is as harsh as it is dangerous. Harsh because it means that only one out of every five young people is able to participate meaningfully in the economy by way of productivity. The rest are consumers; but some of them may not be serious consumers at all because unless they have other people – friends or family – to depend on, it means they have very little or nothing to live on. And it is dangerous because whenever you have too many youth bustling with energy but with no forum to use that energy meaningfully then you are asking for trouble because they become vulnerable to whoever offers them a glimmer of hope.
As things stand now, although the country has impressive economic growth rates, part of the sad reality is that many Ugandans have for a long time been locked out of the actual economy because they lack opportunity for venture capital. So a lot of the Gross Domestic Product is produced by the people who have got jobs or capital, or both, while those who have nothing survive on the periphery.
The sheer prospect of more people participating in the economy should be considered great news for this country, because even with the current inequality in active participation in the economy, Uganda has maintained its ranking among the fastest growing economies in the world. This suggests that if this new programme is handled well, and the government maintains its macro-economic policies that are responsible for the current ‘bubble’, then many more Ugandans will be able to realize an improved standard of living.
With time, this programme should also change the paradigm of employment that many of our people have: that of wearing a tie and sitting behind a desk and issuing orders.
Employment should now take on a new meaning—deploying your energies and talent into an undertaking of your choice, doing your own thing and using it to generate revenue. But like any Government project, this one will only make sense if we all get behind it as a nation, to support both government and the young people.