The Future of Work Meets Africa’s Youth Employment Puzzle

This first appeared August 15, 2022 on The Flip Notes, available at: https://theflip.africa/newsletter/the-future-of-work-meets-africas-youth-employment-puzzle/

As an entrepreneur, there are always more businesses I wish I could start than I’m able to. Nothing makes me happier than dreaming about startups that aren’t mine that can fill pieces of a mega-puzzle I’m eager to solve.

In this case, the mega-puzzle is youth employment in Africa. Anyone who regularly reads The Flip Notes knows what’s coming: Africa’s youthful population is driving an expansion of its working-age population unlike any the world has ever seen, adding more people to the workforce in the next 10 years than the rest of the world combined. The average age in the UK is over 40; the average age in Nigeria is 18. By 2100, 1 in 3 people on earth will live in Africa. It’s simple demographics, not speculation: we accurately know how many working-age adults will exist in markets around the world in twenty years because, well, they’re already alive.

This will impact everything, but employment and workforce dynamics are near the top of that list. Where will people find jobs and livelihoods?

Wicked problems often make for good business opportunities. At Shortlist, we’ve been working for the last six years to connect talent to opportunity more efficiently. We started with recruitment software to automate hiring and moved into executive search and large-scale youth employment programming — you can read more about our journey here. We now run a number of programs with various partners working to create career on-ramps for African youth, particularly around climate/clean energy jobs and remote digital work.

But there are many areas of emerging opportunity to fill in pieces of the youth employment puzzle. Mercy Corps has recently launched the Jobtech Alliance to build community and drive collaboration among leaders innovating how tech helps people access and deliver quality work. It seems this is picking up the attention of investors as well, such as the Future of Learning Fund (part of Future Africa), which focuses on seed stage companies innovating at the nexus of jobtech and edtech.

And VCs, take note: it’s possible edtech and jobtech will be the next fintech, because just like fintech, these businesses will be interwoven into everything. But the beauty of many of these ideas is, they don’t really need VC and can be bootstrapped to profitability — and in fact, for many of these, VC may be the wrong drug.

In any case, below are a few I’m excited about (but the universe of jobtech is much bigger!). Examples abound, but there are few scaled success stories so far and much space for new entrants and innovation.

Job-Experience-as-a-Service

A college degree is no longer a passport to safe and secure employment. It was reported in 2016 that it takes a Kenyan college grad on average 5 years to find a job. There’s a glut of “boot camp” style offerings turning out software engineers, data engineers, product and UX designers — and a number of heavily grant-funded scholarship programs (e.g., Moringa School and ALX) to grow the talent supply sides even more. But these programs are struggling to get their grads placed, because employers generally don’t want to hire someone who has never worked before.

Work experience not only lends credibility to a CV or LinkedIn profile, but in many cases is an essential step to becoming an effective professional. For technical roles like software engineering, work experience is where you really learn how to do the work, as well as how to work in teams and navigate being a professional (i.e., showing up on time, reading social cues, writing emails, etc.). Beyond technical roles, however, first jobs are where many people learn basic interpersonal skills and emotional intelligence, which cannot be effectively learned via the classroom or video content.

So how might we build business models to deliver this work experience at scale?

One of the best-known examples is Generation, an NGO that spun out of McKinsey, which employs a 7-step methodology to train and place young people into jobs. Generation’s programming is practice-based, getting people to do the job as part of the training, with a placement success rate of 80%+ within three months of program completion. To date, they’ve worked with over 60,000 young people, with a significant focus on Africa.

The work we’re doing at Shortlist in our “Talent Drives” business is also geared towards this. In our case, we partner with public funders (governments, foundations) to design and implement programs that reduce friction around getting young people into entry-level jobs in the climate & clean energy (see here and here) and digital sectors in particular. Many of these jobs are teaching foundational, transferable skills in areas like customer service, sales, and digital data management.

There are many others on the continent experimenting with fresh approaches as well. Companies like Moringa School and Decagon are taking matters into their own hands to design apprenticeship programs and actually building managed service tech development offerings, charging corporates to build tech while also giving their students real-life work opportunities.

I’ve also been watching Sprints, out of Egypt, from a distance, who seem to be taking an unusually holistic approach to upskilling. They aim to incorporate training and job-matching into an end-to-end journey that’s focused on getting people into careers, not simply educating them. (I hope this isn’t just lip service!) I look forward to learning more about them and am rooting for their success.

But there are many other promising global examples we might build on. One company making waves in the UK and US is Multiverse, founded by Tony Blair’s son and building scalable models for apprenticeships (leveraging UK’s “Apprenticeship Levy”) as an alternative to traditional university education. Multiverse charges companies to find and place apprentices, and then provides coaching and community to make sure apprentices get the most out of the experience. They seem to be doing something right as they just closed $220 million on a $1.7 billion valuation.

Or take Forage, which partners with leading global corporates to design bite-sized virtual work experiences, in the form of self-guided case studies and work samples. Companies use this for employer branding and to build nontraditional candidate pipelines, and professionals can engage for free to try out different careers and build more practical skills. VCs also seem to like this one, having raised $9.3 million in late 2020 and $25 million in mid-2021. Is there an opportunity for a homegrown version of this, or are African youth better off simply plugging into these platforms directly?

Job Search for 21st Century

The job market has changed so much, and yet job searching just stays the same. What gives?

It’s never been more important to know how to look for jobs, as job-hopping becomes the norm. LinkedIn reports that millennials are switching jobs 24% more now than in 2019, and Gen-Z are switching jobs 134% more, with average job tenure dropping globally. But recruiting has gotten more complex: now candidates often have to run a gauntlet of applicant tracking systems, keyword searches, and algorithms to even be seen by a human. And despite this, an estimated 80% of jobs are never even posted: hires are made informally, through referrals, or because a company “creates a job” for the particular person, rather than a public call.

Getting smarter about job hunting, particularly the mysterious networking part of it, would create significant career value for young professionals, whether getting onto the first rung of the career ladder or already on their way up.

There’s an emerging set of players innovating in this space here in Africa. Check out Lagos-based Stackshift, which is running Web3 fellowships to help African tech professionals advance in the field with a blend of content and community. There are others thinking creatively about this at the high school and university level. Craydel is a higher ed marketplace that weaves a variety of counseling and career coaching into its offerings to high schoolers, getting them thinking early about where an education can take them. Nexford University is also experimenting with a number of ways to innovate on the traditionally weak career counseling and job guidance provided by universities.

There are many global examples to learn from as well. In the US, Pathrise provides online programs blending 1–1 mentorship and content focused on helping people actually land a great job in tech, not simply learn the skills for that job — and professionals only pay upon successful placement. Teal has built a number of tech tools (including a cool job tracker as the “one place to organize and manage your job search”) and community features to support professionals on their job hunt. Placement is a career coaching platform matching young people with a coach to guide through the job transition process. I see promise in models like these working in the African context as well.

Remote Hire-Train-Deploy

But at the end of the day, what good is job prep if there are no jobs? Since 2000, 9 million jobs have been added to the economy each year in Africa, compared to 20 million-plus people joining the workforce each year. As one commentator said: “Africa’s ‘youth employment crisis’ is actually a ‘missing jobs crisis’.”

So if Africa isn’t going to make these jobs, we’ll need to turn to the global economy, particularly digital and remote work. As many populations in the world start to shrink, an African workforce working remotely could become the digital economy’s labor backbone. So: how can we lean into this and get more Africans working as part of global teams without needing to leave home?

Let’s build a lot more Hire-Train-Deploy (HTD) models targeting remote digital work for Africa.

The most (in?)famous local example might be Andela, who sparked imaginations on the continent with the promise of young Africans getting upskilled and employed as part of extended engineering teams. The story played well to investors who invested $140 million into this vision — before it pivoted from upskilling and even Africa to become a global talent marketplace. One of their hard lessons was around the challenge of taking inexperienced youth from zero-to-hero software engineers in a reasonable time period; but that doesn’t mean HTD can’t work in other areas, particularly ones with a much quicker learning curve than engineering.

As we think about HTD models for the Africa and remote work context, it seems the keys to success are (1) figure out efficient upskilling (i.e., get people to the market-expected skill level quickly), and (2) figure out effective demand bridging (i.e., get global companies to trust your talent supply and hire your people). Sure, easier said than done, but the rewards for solving these are big.

I’m loving the emerging set of entrepreneurs looking at this problem area. Companies like CloudFactory, Sama, and Digital Divide Data have been enabling remote work for many years, particularly around data labeling and more recently content moderation. But newer on the scene, check out Nairobi-based Hodi, which trains Kenyans to be sales development reps and uses this team to support sales outreach efforts for global companies. Also very impressed with Lagos-based Caret, which trains and deploys young Nigerians as global customer success professionals. And South Africa-based CoGrammar, using top African engineers to help global companies power technical coding assessments. I can imagine a number of other remote-ready job functions which could also fit an HTD model well, including training remote recruiters to help extend global talent acquisition teams, something I’ve written about recently. After all, LinkedIn last year highlighted that there were more job openings for recruiters in the US than even software engineers.

I’m sure this is just scratching the surface. Case in point, I’ve recently met two amazing US business school students in Nairobi, each exploring new ventures along this same theme. I hope to see even more talent swarm into this space in the coming months. Venture studio, anyone??

We need more entrepreneurial energy and investment capital driving innovation in how young people prepare for and find great career opportunities — in Africa, of course, but also globally. This is my jam, so if people have ideas, need funding, or want a partner, get in touch!