WASHINGTON, July 25, 2019 - As developing countries brace for technological advances and other disruptions arising from climate shocks, fragility, economic integration and population transitions that will fundamentally transform the work landscape, a new World Bank report notes that Sub-Saharan African countries may benefit from digital technology adoption in different ways than other regions.
The Future of Work in Africa: Harnessing the Potential of Digital Technologies for All, a regional companion piece to the World Bank's World Development Report 2019: The Changing Nature of Work, says the region has an opportunity to forge a different path from the rest of the world - if digital technologies are harnessed correctly by governments and businesses by ensuring that critical policies and investments are in place.
"Because most African countries face different development challenges such as lower levels of productive technology adoption and more under-employed people than other regions, an increase in digital technology adoption has the potential to have a positive effect on economies," said Mark Dutz World Bank Lead Economist and one of the report authors. "If widely adopted, digital technologies hold the promise of helping firms grow, and most importantly, create more jobs for everyone, not just a privileged few. But it won't happen unless governments put in place an appropriate business environment."
The report cites a recent study showing that faster internet speeds in African countries increased the employment rate not only for university graduates, but for those workers who had a secondary or even only a primary level of education.
But while there is innovation and growth potential, the report warns that the success of digital and related technology adoption depends on having the right supportive policies in place. Governments need to ensure sufficient market competition, better entrepreneurial and worker human capital, and better physical infrastructure, according to the report, as well as stronger capacities to increase public investments in social protection.
"The region's underlying conditions, such as a large informal sector and persistently low levels of human capital, do not need to be a disadvantage" said Jieun Choi, World Bank Senior Economist and a report author. "Because Africa has a smaller manufacturing base, automation is not likely to displace many workers over the next years. At the same time, digital technology adoption can help businesses reduce their costs and prices, enabling them to expand their production and employment across all sectors, while access to internet and mobile apps can help low-skilled workers to learn better farming practices or sell more effectively in markets."
To take advantage of these opportunities, the report offers several fundamental public policy recommendations for governments to consider, including:
- Ensure that digital infrastructure is available and affordable to all-in rural and urban areas, and across all demographics-by developing digital infrastructure regulation that spurs competition, supports universal access, and promotes integration across countries to create bigger markets
- Provide complementary physical infrastructure such as reliable electricity
- Support the inventors and entrepreneurs that are needed to develop tools both for upskilling the stock of low-skilled workers in their current occupations and for the new tasks that the adoption of new technologies will enable
- Develop interventions to facilitate the productivity upgrading of informal farms and firms and to upgrade the skills of their workers
- Expand the coverage of social protection and labor systems, especially to workers, to spur greater entrepreneurial and worker risk-taking, and to facilitate worker transitions between jobs
"We know that it won't be easy to establish the necessary foundations needed to capitalize on Africa's digital and broader economic transformation, but it can be done," said report author Zainab Usman, World Bank Social Development Specialist. "With government policy makers and business investments supporting the needed changes, the next generation of African workers, inventors and entrepreneurs have the potential to innovate and thrive."
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