Data Hub

More youth now seek self-employment, space in gig economy

pic
BDgeneric_logo

Summary

  • A report on Future of Work shows that the pandemic forced many young people to be self-employed and in the case of those employed, to develop a side hustle for financial wealth and safety.
  • Starting a business was ranked highest at 39 percent in providing flexibility and supporting their households, especially among women.
  • The survey was conducted among 6,073 young people aged 16 to 30 years from across eight countries, including Kenya, Canada, Ghana, Jordan, India, Pakistan, the UK and the US.

One in every five young people has set up a business under an economy that receded on pandemic-induced restrictions.

A report on Future of Work shows that the pandemic forced many young people to be self-employed and in the case of those employed, to develop a side hustle for financial wealth and safety.

The report by The Prince’s Trust group of charities - founded by His Royal Highness the Prince of Wales - also shows that now the majority of young people prefer to start their businesses than seek jobs with the government or private companies.

About 41 percent of the participants said are working for themselves and it was the profession that they would most like to work in, more than a job in a large corporation (34 percent) or working for the government (36 percent).

Those employed are also operating a business on the side.

Participants in Kenya and the US said pandemic-related lockdowns had allowed them to work on their side hustles, which included starting businesses selling clothes or phone accessories, learning to code, trying journalism and consultancy, or setting up cooking channels on social media.

“The research recognised the growing trend towards entrepreneurship. Of those surveyed, 16 percent secure their primary income working for themselves. Of those working two jobs, a plurality (28 percent) have a secondary job working for themselves. In total, a fifth of young people work for themselves,” it stated.

Starting a business was ranked highest at 39 percent in providing flexibility and supporting their households, especially among women.

About 38 percent, participants said setting up their own business is most likely to bring financial wealth, while 34 percent said it would provide opportunities they would not get.

The survey was conducted among 6,073 young people aged 16 to 30 years from across eight countries, including Kenya, Canada, Ghana, Jordan, India, Pakistan, the UK and the US.

Of those surveyed, 56 percent were employed – 45 percent we working a single job while 11 percent had multiple jobs -, 26 percent studying and 13 percent in neither.

“The coronavirus pandemic made me concentrate full-time on my boutique. I used to have it for a long time, but it was on-and-off because I was employed. But when Covid-19 came the employment contract ended so I had to focus,’’ a participant of the survey from Kenya was quoted saying.

The report follows more than a year since coronavirus hit the country leading to massive layoffs as companies reported a plunge in sales, compelling a freeze in hiring.

About 1.72 million workers lost jobs in three months to June last year when Kenya imposed a strict lockdown.

The Kenya National Bureau of Statistics report also showed about 253,500 jobs were shed in the three months to March this year despite the economy showing signs of recovery from Covid-19 hardships.

Young people were the hardest hit with employees aged below 25 bearing the brunt of the layoffs.

Firms have this year been hiring on picking demand and softening recovery but the rates are still lower on subdued consumer spending and high taxation.

Companies have cited the increased cost of inputs such as raw materials due to constraints in global supply chains and expenses exacerbated by high fuel prices.

The Future of Work report shows 47 percent of the restrictions had negatively affected their current work, education or training, while an equal proportion said the pandemic had negatively affected their mental health.

The damage to employment opportunities had been greatest for the under 35 years with fewer vacancies and salary cuts, according to the survey.

Interestingly, participants in Kenya felt that older generations were worse affected regarding employment, particularly since job losses were even more impactful for those with dependants.

Young people described income as the main reason for working in order to meet their basic needs, which was sharpened by the pandemic.

Professional careers such as law and medicine are seen as most likely to provide a steady income and bring respect from family, peers and the wider society.

Retail, hospitality and tourism are ranked highest in providing job opportunities for young people, along with information and digital technology.

This is despite the retail, hospitality and tourism sectors being the hardest hit by the pandemic and recording the highest job cuts.

Fulfilling work

Young people felt that the most fulfilling work was in teaching and education, health and social care. The high unemployment has also led to growth in the gig economy and expansion of the informal sector attracting young people.

Gig economy has been concentrated in the ride-hailing industry and online rental such as Airbnb, according to a Kenya gig economy report by Mercy Corps released in August 2019, adding that uptake of online professional services was expected to spike by 2023.

The survey shows advances in the digital economy are creating opportunities coupled with changing demographics that have opened job vacancies in care, teaching, green and some service sectors.

Most young people who see more job opportunities in green and digital economies at 74 percent and 71 percent respectively are, however, worried about skills and the high cost of university and college education.

About 41 percent want the government to ensure schools teach professional skills in those areas, while 36 percent said it should make higher education more affordable and 32 percent create a job guarantee.

“This report has shown young people’s growing passion for entrepreneurship and how important it is for young Kenyans to have access to the right tools to enable them to fulfill their future ambitions,” said chief executive of Prince’s Trust International, Will Straw.

“It is exciting to see so many young people determined to make a difference to local communities and the wider world – these young people are the agents of change, and we must support them to achieve their ambitions”.

[email protected]