Why CDF Empowerment may fail: Here are ingredients for designing a Successful Youth Job Creation Strategy

By Mwansa Chalwe Snr

It is January, 2022, and the roll out of the much talked about Constituency Development Fund (CDF) is imminent. There has been so much banked on the youth empowerment portion of the CDF; and even being touted as the answer to Zambia’s youth unemployment problem. This optimism is a bit misplaced. And it is important that we have an adult debate as what should be done to avoid past mistakes.

This article is specifically about the creation of jobs through Youth entrepreneurship. And one of the vehicles that the New Dawn administration has deployed to create jobs is the Constituency Development Fund, which now has a component for empowering the Youth and women. The issue of increasing Constituency Development Funds (CDF) from K1.6 billion to K25.6 billion, with K15 million allocated for entrepreneurship programs or projects is a laudable one. However, taking funds to rural areas alone, without accompanying strategies, is not adequate innovation to address the intractable problem of youth unemployment.

If there are no proper entrepreneurship and technical skills as well as capacity building activities that precede disbursements, then it merely means that funds are being moved from Lusaka and being taken to the more “ignorant” rural people, who are even less equipped than those who accessed previous empowerment funds in urban areas. This is unlikely to produce impactful results. This view is based on fact that there are millions of Youth who are currently unemployed in Zambia who need jobs, and loosely designed interventions will not achieve the desired results. For a start, it is important that the magnitude of the youth unemployment in Zambia is presented so that those who are designing programs are able to use it as a basis.

Situation analysis – Current Youth unemployment status

Needless to say that any design for solutions should be based on data available. In order to put Zambia’s Youth unemployment situation in context, a few numbers are useful. In 2018, the Minister of Labour estimated Zambia’s youth unemployment rate to be 41% but critics were of the view this was grossly understated. And academic Dr. Sishuwa Sishuwa put it at 70%. It has also been estimated that between 300,000 and 350,000 youths enter the labour market every year which means that an additional 1.8million jobs will be required in the next 5 years of the UPND administration. This is in addition to the current unemployed who are also in millions. The total stock of unemployed youth in next five years could be in the region of 4-5 Million. In 2016, the Zambia Daily Mail reported that 168,119 applicants applied for the Zambia Army, Zambia Air force and Zambia National Service for an estimated 1,500 positions. It is also estimated that Zambia has 8million actively employed (formal and informal) citizens out of which 85% or about 6,800,000 (6.8 million) are in the informal survivalist employment sector. There is only an estimated 15% or about 1.2million Zambians in formal employment at the moment. And according to United Nations Populations Fund (UNFPA), 82% of Zambian population is below the age of.35 years.

On the basis of the above numbers, it does not take a genius to conclude that these are numbers that should be driving policy and the magnitude of interventions. Also, it is clear from the publicly available information that the current government interventions are totally inadequate to address the numbers of youth jobs required. Zambia needs quick, aggressive interventions and high impact programs to stimulate the economy and create millions of jobs. It is also apparent that the UPND administration, like others before it, is certainly limited by what it knows. There is need for some inspiration, imagination, innovation and thinking outside the box. And of course looking outside the bureaucracy for help would be useful.

Youth Entrepreneurship, the roadmap to Job Creation

President HH has emphasized that fixing the economy is a precursor to job creation. Inasmuch as there is no doubt that economic growth and a stable macroeconomic environment plus the promotion of foreign investment do create some jobs, experience has shown that they are insufficient to tackle youth related unemployment in the magnitude of Zambia’s situation, with millions unemployed. There is, therefore, a need for innovative initiatives that entail aggressive direct and formal interventions. It is internationally agreed that the promotion of Youth entrepreneurship can partly provide a solution to youth unemployment in environments where there is massive unemployment like Zambia. Fortunately, the New Dawn administration does recognize this, but the main question one may ask is: are they going about it the right way? The answer is a definite no. One gets the impression that the New Dawn administration’s initiatives are not well researched as most of them, if not all, appear to follow what the Patriotic Front (PF) and Movement for Multi-Party Democracy (MMD) before them, implemented with a bit of tinkering.

According to the World Bank’s evaluation of Youth employment programs around the World, it concluded that solving youth unemployment is a multi-sectoral issue, but few youth employment projects are implemented in multi-sector manner and with multi-sectoral teams.

“Factors that contribute to success are a comprehensive approach including participation of the private sector, complementary interventions rather than isolated interventions”, noted the World Bank and IFC, Youth Employment programs Evaluation Report, 2012.
The Youth and Women component of CDF has many flaws as a job creation vehicle. The first major concern relates to capacity issues.

Do the envisaged assessors of project proposals have the requisite skills to evaluate the viability of proposals that will be submitted by the youth and women? On the other hand, will the recipients (youths and women) have prior capacity to successfully execute the projects, contribute to growth of economy and create jobs? The second concern relates to the actual design of intervention and programs to execute the intervention. How has the intervention been designed? How will it monitored and evaluated? In the absence of well thought out, formal and properly designed entrepreneurship programs that will be tapping into the CDF, the initiative is destined to fail like its predecessor, the Youth Development Fund (YDF) which was based in Lusaka. The only difference will be that the current initiative is now based in constituencies especially rural areas.

Ingredients for a Successful Youth Job Creation Strategy

The current approach for designing Youth empowerment programs by the UPND Alliance appear to follow a Silo approach to Youth empowerment. There is an over emphasis on the provision of money and asking the youth to form cooperatives and businesses. This kind of approach has been tried in Zambia by previous administrations and by other countries in the World, and it has miserably failed to create sufficient jobs. This conclusion is based on review of the different studies done by Development finance institutions and Agencies such as Organisation of Economic Cooperation and Development (OECD), the International Labour Organisation (ILO), African Development Bank, United Nations Development Program (UNDP), World Bank and others. The New Dawn government, therefore, will need to make some adjustments to take into accounts the necessary ingredients outlined below.

In Zambia, there has been a fallacious and inherent belief by the youth, politicians and bureaucrats that finance is the panacea in empowering the youth to start or grow a business. The other challenges which are supposed to be prioritised, and precede the disbursement of funds, are neglected. Finance should rank second or third in the youth empowerment value chain. There is need for government to recognize that Youth entrepreneurship constraints are broad, and should never be centred around and reduced to the provision of finance alone like the Constituency Development Fund (CDF) appears to be suggest. The correct approach should be to map out a comprehensive strategy based on proper diagnosis of the constraints to youth job creation in the entrepreneurial ecosystem. And on the basis of studies of Youth programs, there a number of essential ingredients that a comprehensive design of a successful youth empowerment program should contain which should be considered in the implementation of the Youth and Women empowerment component of the Constituency Development Fund (CDF) by the HH administration.

According to some studies, the first ingredient for any Youth empowerment program design should be the provision of basic entrepreneurship information and Knowledge to the youth because they lack experience. This should be preferable be digitally distributed using mobile phone technology in order to reach millions of youth by way of fast track E- learning. The mass access to information and knowledge is the key to success of any programme. If any programme is to succeed, it has to ensure that hundreds of thousands and better still, millions of youth have access to such programmes. The net has to be cast wider than before. There is need to have a structure and process that ensures that this is taken care of. How to navigate this conundrum is the New Dawn’s administration’s challenge. However, there is help outside, if they seek it.

The second ingredient is the recognition of heterogeneity of the youth population. There is need to identify the various youth demographics to ascertain their needs. The Youth population is not homogeneous and any interventions that approaches the problem with a one size fits all solution, as was in case in the past, is bound to fail. The one size fits all to program design ought to be discarded. There is a need for a differentiated approach. The type of interventions to be rolled out should depend on the identified youth demographics’ specific needs. For instance, it is not all youth that need money to be empowered. There are some youth demographics that just need market access or linkages in order to grow and create jobs, while others need skills development (entrepreneurship, technical, management) and mentorship. The younger Youth demographics who are in education institutions need mind-set change and innovation enhancement.

The third ingredient that should be incorporated in the design and implementation of Youth empowerment roadmap or programs is the Private sector. Studies both by the World Bank and the African Development Bank (AfDB) recognize this major weakness in most government program designs. It is private sector who know where and how jobs can be created.

“There is often insufficient consultation with and engagement of the private sector. The private sector is an essential stakeholder in addressing youth unemployment, not only as the engine of job creation but also as a potential partner to implement complex interventions alongside governments and civil society actors”, the AfDB noted in its research of why African government Youth interventions have failed.

The fourth major ingredient in design of successful Youth empowerment roadmap is the consideration of the informal sector or street venders as we refer to them in Zambia. The informal Sector has been ignored by governments and yet, it is the lowest hanging fruit for potential formal job creation through the graduation of some of its segments to the formal sector

“Another major gap in past efforts was a lack of focus on the informal sector, where the majority of youth are currently employed. Projects are often designed based on labor market data that more accurately captures formal versus informal workers; interventions mostly focus on reducing overall unemployment and not informal employment as well; and many monitoring and evaluation frameworks do not take into account indicators such as job quality and stability, which are especially challenging for informal workers”, the AfDB wrote in its report.

It is only by taking into account the above well researched factors in the design of the different Youth empowerment programs that hundreds of thousands and even millions of jobs can be created. The current approach entails doing the same thing with little twinkling and expecting a different result. It will not be successful as the numbers required will not be achieved.

Conclusion

The matters discussed in the article entail the involvement of four Youth cluster ministries: Youth, Sport and art, Small and Medium Enterprises (SMEs), Technology and Science and lastly Ministry of Education. These ministries have different roles to play in a well-designed comprehensive Youth job creation roadmap, which should be made up of short term, medium term and long term programs. On the basis of the fact that four different Ministries are involved, and this requires some coordination and direction, it is imperative that the President of Zambia as the Chief Executive of the country, takes a keen interest in the design of the Youth job creation roadmap through Entrepreneurship and its actual launch.

Although the article may appear to be theoretical at face value, I have translated the above principles into practice, to help the New Dawn administration solve the Youth unemployment problem. I have developed and designed two shovel ready, off the shelf, innovative youth entrepreneurial solutions with potential to create millions of formal jobs. The first program entails the creation of formal jobs, by tapping into the blue ocean of some segment of Street Vendors (the informal sector). The second involves the use of cell phone technology as a tool to create jobs through the provision of entrepreneurship information and knowledge to millions of youth. Cell phones are gadgets that youths are addicted to and are the best conduit for job creation in the 21st Century. These solutions can easily be rolled out immediately by the New Dawn administration so that they give hope to the Zambian youth. These proposals will complement the Constituency Development Fund and other available programs by making them effective through reaching the critical mass of youth due to increased access inherent in the programs designed. The two initiatives proposed are transformational in impact due to their mass access and cannot be matched by any other solutions that is currently available.

It is crystal clear that in order for youth entrepreneurship promotion to succeed, Zambia needs to adopt both short term and long term strategies. These should include the provision of information and knowledge to the widest population of young people about entrepreneurship using modern technology so as to unearth potential entrepreneurs, conversion of necessity entrepreneurs in the informal sector to the formal sector, providing business development services for out-of-school youth, supporting access to cheap finance for young entrepreneurs, and introducing entrepreneurship education in schools so as to change the youth mind-set that there are two routes to employment on completion of studies: Self-employment and formal salary employment.

The writer is a Chartered Accountant and Author. He is a retired international MSMEs Consultant and an independent financial commentator. He is also an Op-Ed Contributor to the Hong Kong based, Alibaba owned, and South China Morning Post (SCMP) .Contact: [email protected]