December 22, 2005
Economies Are Growing, But Unemployment and Poverty Remain High in Africa
OneWorld US

Despite significant improvement in economic growth, nearly half of the population on the African continent remains poor and jobless, a new study by the United Nations points out. Despite significant improvement in the Gross Domestic Product (GDP) in recent years, 46 percent of the total population still earns less than a dollar a day.

Haider Rizvi, OneWorld US
Thu Dec 22, 2:25 PM ET

UNITED NATIONS, Dec 22 (OneWorld) - Despite significant improvement in economic growth, nearly half of the population on the African continent remains poor and jobless, a new study by the United Nations points out.

"Poverty in Africa is chronic and rising," say authors of the report, entitled "Meeting the Challenges of Unemployment and Poverty in Africa," the sixth in the annual series released by the U.N. Economic Commission for Africa here this week.

Despite significant improvement in the Gross Domestic Product (GDP) in recent years, 46 percent of the total population still earns less than a dollar a day.

While describing the rise of poverty in Africa as "enigmatic," the researchers say underlying this trend is the fact that the majority of people have no jobs or secure sources of income.

In their view, unemployment has become one of the greatest challenges to the continent's development.

The report shows that since 1995, average rates of unemployment have been between 10 and 11 percent in both North Africa and the sub-Saharan region, and this does not include the working poor or those who have given up on finding a decent job.

By contrast, average annual GDP growth has steadily increased, from less than three percent in 1998 to 4.6 percent in 2004.

"These are the world's second- and third-highest unemployment rates, with the Middle East region experiencing the highest rates," according to the study.

Though various reasons are given for the failure of economic growth to reduce poverty, the U.N. researchers identify three major factors shaping this trend: the "inadequacy" of the growth rate, "low labor absorption" in the growth sectors, and "inequality in the distribution of opportunities."

The study suggests that sustained growth is a must to increase employment and reduce poverty, but so far only a few countries have managed to accomplish this.

"A major route out of poverty in Africa is decent employment," according to the authors, who believe that decent employment strengthens the link between economic growth and aggressive poverty reduction.

Creating productive and secure jobs with adequate income and reasonable work conditions demands the African economy undergo transformation from low-productivity traditional agriculture to labor-intensive high-value agriculture, and to the growing industrial and service sectors, the report argues.

Political leaders should prioritize broad-based employment creation in national development programs, including poverty reduction strategies, it adds.

Based on current demographic trends, it is estimated that the continent would need to create about eight million jobs every year in order to effectively tackle the problem of unemployment.

The study emphasizes that in order to achieve sustainable growth and equitable distribution of income, the political governance on the continent needs to be improved. However, it does acknowledge that interest in Africa's employment challenge is emerging.

"African governments have, in recent years, asked about the connection between employment and poverty reduction and microeconomic management and development frameworks," the report says.

Last year African heads of state gathered in Burkina Faso, where they adopted the "Declaration of Employment and Poverty Alleviation."

Pledging to fight poverty through employment, African leaders acknowledged that widespread poverty and unemployment compromise basic human rights and pose a threat to social, economic, and political stability.

The study endorses the findings of another U.N. report that focused on the link between economic growth and poverty.

Released in August, the 158-page report titled, "The World Social Situation: The Inequality Predicament," said that despite "unprecedented economic growth" in recent years, the rich have become richer and the poor even poorer.

"The world is even more polarized today than ever before," said the authors while pointing out that inequality between and within countries has often accompanied economic globalization.

These inequalities, according to the report, have had negative consequences in many areas, including employment, job security, and wages.

"Ignoring inequality in the pursuit of development is perilous," it warned. "Focusing exclusively on economic growth and income generation as development strategy is ineffective as long as it leads to the accumulation of wealth by a few and deepens the poverty of many."

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