Five million. That’s how many jobs our global economy needs to create each month to absorb everyone entering the job market in the next decade. Based on today’s numbers, nearly half those jobs will be for youth.
But instead of gaining jobs, the global economy remains sluggish and low-skilled jobs are increasingly lost to automation. In Spain and Greece, youth unemployment rates have reached nearly 50 percent, and in Tunisia, where the Arab Spring started, the youth unemployment rate hasn’t budged from over 30 percent since the protests.
High youth unemployment is one of the biggest problems confronting advanced and developing countries alike. To ease the crisis, government policies and practices have focused on vocational education and financial provisions, but these measures have hardly made a dent.
Fortunately, digital technology offers some solutions. While technological advances alone are never enough, a mix of regulation, investment and school integration can foster new technological solutions to the youth unemployment crisis.
Here is the opportunity.
Digital technology can:
- Bring the right skills to youth. Massive Open Online Courses (MOOCs) let youth access low-cost, customizable education worldwide without the financial burdens and strict schedules of traditional brick and mortar institutions. U.S.-based Coursera offers more than 1,300 courses, allowing students to create a curriculum tailored to their schedules and employer needs. If courses can emphasize both the soft and technical skills that employers seek and keep students engaged to mitigate traditionally high online learning dropout rates, MOOCs could make a significant contribution to curb youth unemployment. Further, MOOCs that are able to use data on dropout rates and test scores can identify learning pain points and adapt over time to continue to meet the needs of students.
- Expand networks virtually. Networking is key to finding and maintaining a job – in the U.S., this is how nearly 70 percent of jobs are found, and a study on the German workforce showed positive correlation between networking and both job satisfaction and salary growth over time. Digital technology makes networking all the easier and more expansive. Mexico’s Oportunidades para Interacionalistas connects nearly 30,000 young people via a free online platform where members share jobs, conferences and scholarship opportunities. That said, the success of such online platforms requires digital literacy on both sides: Youth need to be comfortable communicating and sharing their skills online, and employers need to know how to use social media and other digital technology platforms to share information and advertise positions directly to students.
- Create new career models. Digital technology is changing the job landscape by creating career models that never existed before. In the sharing economy, young people can create their own day-to-day-job via a web or mobile platform. Nairobi-based Juakali links skilled workers such as electricians and mechanics with clients online. Rather than waiting in street-side markets, these workers can market their relevant skills and experience to reach the right customers efficiently. As long as policies support these nontraditional careers, young people may increasingly have multiple simultaneous jobs, rather than one full-time source of employment.
- Outsource online tasks to young people. Companies are increasingly using online marketplaces to outsource tasks to workers globally. According to the World Bank, the total market size for online outsourcing is $1 billion and could grow to $5 billion by 2018. One of the industry’s leaders, Upwork, posts more than 3 million jobs annually for website and logo developers, virtual assistants, mobile app developers and other third-party workers. CloudFactory in Nepal takes a micro-work approach, connecting 1 million people in the developing world to employers with large digital projects pieced into tasks that freelancers with basic ICT skills can complete. As young people use technology to access jobs in an increasingly competitive online marketplace, online outsourcing will enable companies to curate specific tasks and identify specialized talent to complete them.
- Encourage young people to pursue digital entrepreneurship. Digital technology is enabling young people to create and manage their own ventures, be it maintaining and servicing technology itself through Internet kiosks or mobile phone servicing, or creating digital start-ups via mobile apps. It is not easy – public recognition of the value of entrepreneurship remains low, thereby hindering many from establishing their own businesses. However, youth can now secure funding more easily through online platforms like Kickstarter, helping to ease doubts. As young people develop entrepreneurial skills and as digital technology becomes more ubiquitous, we are likely to see more youth using technology to create their own jobs rather than relying on someone else to create opportunities for them.
These trends are promising. But across the board they require collaboration between public and private sectors to work. To take advantage of the promise that digital technology holds for youth unemployment, governments and companies need to work together in three key ways:
Invest in digital infrastructure. To capitalize on online opportunities, youth first need access to the Web: reliable mobile and Internet access. The good news is that cities and countries see concrete benefits when they invest in digital infrastructure: A 10 percent increase in broadband penetration can result in a 1.38 percent increase in GDP. In 2014, the government of Kenya awarded Huawei a contract to build a national fiber optic infrastructure to connect Nairobi, dubbed Africa’s “Silicon Savannah,” with other towns in the country. The public sector should continue to identify private-sector partners who will compete amongst themselves to lower costs and ensure that governments are building infrastructure relevant for the future.
Develop new, responsive regulatory frameworks. As distance education and sharing economy models expand, regulation will need to evolve and balance companies’ growth and consumer interests. For example, in late 2014, AirBnB and the city of Amsterdam signed an agreement to promote “responsible home sharing” in response to the city’s concern that guidelines were unclear and some hotels were avoiding permits by pretending to be AirBnb rentals. The agreement resulted in regulation that advanced AirBnB’s commercial interests while also protecting the rights of tourists and citizens. In the future, companies and governments should be just as proactive in developing tailored regulation to evolving circumstances.
Integrate technology into school curricula. According to Digital Europe, the largest obstacle to harnessing the power of ICT is shortage of digital skills. To ensure youth are prepared for the changing job market, governments should embed technology into school curricula, ensure access to computers in the classroom and equip teachers with digital skills. Countries like Estonia have taken the lead: First-graders create their own computer games, high school students code, and schools can add computer science and robotics to their course offerings.
Youth unemployment is a complex issue with no easy fix, but there are concrete steps we can take to cultivate solutions through digital technology.