Sub-Saharan Africa’s economies are experiencing a modest recovery, with gross domestic product (GDP) growth in the region expected to rise to 2.4% in 2017 from 1.3% last year. This moderate pace remains below population growth, making it difficult for countries to make a significant dent in poverty unless greater efforts are undertaken to increase efficiency of investment and to pursue new drivers of sustainable growth.
The findings of the sixteenth edition of the Africa’s Pulse, a bi-annual analysis of the state of African economies conducted by the World Bank, reveal a challenging economic outlook for the region.
According to World Bank Chief Economist for Africa, Albert Zeufack, “recovery is weak in several key dimensions, notably, low investment growth and falling productivity growth. This calls for more sweeping structural reforms that can help ensure that economic growth is anchored on a strong footing.”
The report underscores a decrease in the efficiency of investment, especially in countries with less resilient economies. This is particularly true for skills development in Africa, where countries must reconcile the fact that despite investing heavily in building skills (public expenditure on education has increased sevenfold over the past 30 years), the region continues to have the least skilled workforce in the world.
Poverty and boost economic inclusion
As Sub-Saharan Africa seeks to boost innovation, adopt new technologies, and disrupt ‘business as usual’ practices, it will be critical that African governments continue to tackle the skills gap that spans all demographics.
There have been some impressive achievements. More African children are in school today than ever and over the past fifty years, primary completion rates have more than doubled while completion of lower secondary school has increased five-fold
And yet, big challenges still remain. Almost one in every three children fail to complete primary school. In most countries, less than 50% of children complete lower secondary education, and less than 10% make it to higher education.
“When you compare the levels of public spending on education to the fact that millions of African children are still not acquiring basic skills for productive participation in the labor force, you realize that the root of the problem lies in the quality of investment,” emphasized Punam Chuhan-Pole, World Bank Lead Economist and lead author of the report.
Going forward, Sub-Saharan African governments will need to strike the right balance between investing in overall productivity growth and inclusion, on the one hand, and investing in the skills of today’s and tomorrow’s workforce, on the other.
Achieving strong economic growth means investing in foundational skills for the entire population, not just upcoming generations. Far too many youth across Sub-Saharan Africa emerge from school without the basic skills to advance in their lives. At the same time, countries cannot afford to ignore the needs of the current working-age generation where in many places, fewer than half of adults can read and write.
Employing an inclusive approach to investing in foundational skills means simultaneously addressing child stunting and building the literacy, numeracy, and socioemotional skills of children, young people, and adults. It also means investing in labor market training for disadvantaged youth, workers in low-productivity areas, workers in farm and nonfarm rural activities, and the urban self-employment.
“Sustained economic growth is unattainable if the population does not have fundamental literacy and numeracy skills that allow them to function as citizens and to work towards their dreams,” says David Evans, World Bank Lead Economist and one of the authors of the analysis on skills development in African countries.
According to the report, investing in fundamental skills for all is a win-win approach that would allow African governments to enhance productivity growth, promote greater inclusion, and ensure the adaptability of the workforce to the markets of the future.
Special attention should also be paid to science, technology, engineering, and mathematics (STEM) skills in addition to creating the right policy environment to allow for investments in technology and innovation to pay off.