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Evidence for creating better jobs for the future

With over 1.2 billion people expected to reach working age in the next decade, there is a dire need for the economy to support global employment growth. From 8–9 October in Cairo, Egypt, the 2024 Jobs and Development Conference brought together global experts to tackle one of the most pressing issues of our time: how to create more and better jobs, especially in the Global South.

A key takeaway from the conference was the sheer urgency of addressing youth unemployment in the Global South. In the coming decade, over 700 million young people will complete their education. Yet, if current trends continue, 4 of 10 won’t find jobs. In regions like the Middle East and North Africa, the projection is almost 6 of 10.

A crisis in waiting

This staggering reality is not just that more jobs are needed—better jobs are needed, too. Economies should provide jobs that offer security, fair wages, and the opportunity for upward mobility. The challenge is not just economic but social, as high unemployment can drive inequality, political instability, and even migration. Policies and research to tackle this crisis must be driven by the Global South itself. Solutions designed with local contexts in mind will be key to unlocking sustainable and inclusive job creation.

Rethinking work: the impact of tasks, not just skills

A major theme at the conference was how the nature of work is changing and what that means for inequality. In wealthier countries, we've seen job polarization—more jobs at the very top and bottom of the skill ladder, but fewer in the middle. This trend, driven by whether employment tasks are routine and can be automated or offshored, has hollowed out middle-class jobs.

But what about low- and middle-income countries? The evidence is still scarce, but the data we do have suggests a different picture. Research from UNU-WIDER's Tasks, Skills, and Institutions: The changing nature of work and inequality book shows that in 11 countries studied, the way tasks are structured in jobs—and how those tasks are valued—doesn’t match assumptions drawn from Global North countries. In short, job polarization is—at least not yet—the major challenge to reducing earnings inequalities. By better understanding the role of tasks (not just skill levels) in local occupations, policymakers are better positioned to create targeted interventions that reduce inequality and protect vulnerable workers.

This research offers a new lens for understanding how jobs are changing globally and how economies might avoid the pitfalls of polarization seen in wealthier economies.

Addressing youth unemployment: what works?

New research on life transitions in the Global South is shedding light on how to make economies work for young people and new entrants to the labour market. Vocational training programs, which should be critical to closing the skills gap in many contexts, do not have high job placement rates on their own. This creates an opportunity for programmatic interventions to support youth employment.

In an experiment with 200,000 applicants, based on this WIDER Working Paper, results showed that female students outcompete male counterparts in the job search—though most continue to struggle to find work. The study also confirmed that students graduating during a recession struggle more than students who graduate outside of a recession.

This underscores a critical insight: policies to reduce unemployment need to be flexible and tailored to specific target groups. What works for one demographic, or during one economic cycle, may not work for another. For example, female students can be better supported by programmes tailored to their needs, which provide childcare support for example. Access to information for job seekers helps graduates find jobs faster, proving that even low-cost interventions can make a difference.

Do countries need industrial policy?

I learned from Aimable Nsabimana’s presentation on forthcoming research on human capital accumulation amidst shocks that several countries in sub-Saharan Africa—including Rwanda, Ethiopia, and Ghana—are investing in ambitious initiatives to jumpstart new industries, like the ‘One-district-one-factory’ scheme in Ghana, which aims to help local entrepreneurs to establish and own factories with government support in accessing funding and essential services, while they retain full autonomy on the project.  

When successful, these programmes create benefits that extend beyond the job creation. For instance, an impact evaluation of coffee mills in Rwanda found that students living near these mills outperformed their peers in education levels and test scores. Proximity to mills boosts household incomes and employment opportunities, which improved school attendance, thus eventually increasing learning outcomes.

These spillover effects illustrate the broader potential of well-designed industrial policies. By strengthening local economies and raising household welfare, these initiatives can improve livelihoods, support human capital development, and increase social mobility.

Moving forward

The 2024 Jobs and Development Conference made clear that the challenges facing labour markets in the Global South are immense—but so are the opportunities. As millions of young people prepare to enter the workforce, countries must prioritize the creation of not just more jobs, but better ones. The conference was an important step in that direction.

Leeni Varis is a Communications and Social Media Assistant at UNU-WIDER.

The views expressed in this piece are those of the authors, and do not necessarily reflect the views of the Institute or the United Nations University, nor the programme/project donors.