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According to the Population Reference Bureau (PRB), up to 51 per cent of youth are unemployed in southern Africa. Unemployment undermines the foundations of a stable, prosperous society and restricts opportunities for growth, writes Dimitri Zakharov.
The economic and social costs of unemployment are well known, often locking people into a vicious cycle of poverty and exclusion. With 90 per cent of the world’s youth living in developing countries, the lack of job opportunities leads to a dangerous expansion of the informal sector, forcing young people to accept a reality of job insecurity, low erratic income, and few options for advancement.
This challenge is significantly displayed in Zambia – a country of about 14 million people with one of the youngest populations in the world by median age, and where 59 per cent of its youth aged 20-24 are unemployed (1.7 million people). Those who can’t find work often go into the informal economy, about 60 per cent being in agriculture.
The Promise of Impact Sourcing
The same methods that have been attempted for decades cannot be relied upon to solve this crisis, and the digital marketplace (grossly overlooked in Zambia) may be the solution we’ve been waiting for.
The impact sourcing industry is a testament to what technology is making possible. Impact sourcing is a subsector of the business process outsourcing (BPO) industry that focuses on addressing social issues and employing those from disadvantaged backgrounds. According to the Everest Group, impact sourcing already employs 240,000 workers worldwide. That makes up 12 per cent of the entire $104 billion BPO market.
Impact Enterprises, the first impact sourcing service provider (ISSP) in Zambia, is a shining example of how harnessing technological innovation can tackle the challenge of unemployment, while providing valuable services to global customers.
Since 2013, we’ve hired over 100 Zambian employees, and for more than half of them this has been their first formal job. Thanks to their new income, 83 per cent can support an average of three people.
What we’ve witnessed is that the youth idling in the economic torpor already possess the skills, understanding, and alacrity to compete on a global scale. What they require is the opportunity, guidance, and digital marketplace that will allow them to compete fairly with their international peers.
‘Being at Impact Enterprises means a lot to me,’ says Debra Chaka, a recently hired Data Specialist. ‘When a person is surrounded by positive minded, dream-oriented, enthusiastic individuals, life is worth living because you know you can make it anywhere.’
A Need to Diversify
The Zambian economy is almost entirely dependent on copper mining. The industry has been the backbone of the economy, but this reliance on one sector is currently crippling the country. Copper prices are now at a six-year low, and as a result the Zambian Kwacha is the worst performing currency in the world. Therefore, diversification and innovation is necessary for creating the opportunities that young Zambians are crying out for.
Existing initiatives by the Zambian government and foreign investors to tackle unemployment tend to favour the agriculture and manufacturing sectors. To reach economies of scale, these industries require huge capital investments and a complex network of trade. With relatively few of these commitments entering Zambia, the job market continues to fall farther behind its emerging market peers.
However, the IT industry, which has been virtually ignored to date, has huge potential to quickly employ youth with lower capital expenditures. In the first year alone, Impact Enterprises expanded its workforce sevenfold.
‘This was my first work experience in a real office,’ Rodger Lungu, one of our Data Specialists, told us. ‘I learned how to work with people with different values and from all walks of life. Through my online research skills, I could find more information about how to start my [own] company, and get ideas and inspiration.’
Globalization and advances in digital communications have created a world where access to information and employment is no longer determined by where you are born. While the challenge at hand is enormous, so too is the potential of the technology sector to address it.
The rapidly expanding impact sourcing sector is demonstrating that eager individuals across the developing world have the skills to work and compete in the international marketplace. Impact Enterprises, along with the other ISSPs across Africa, is pioneering socially conscious outsourcing as a way to provide valuable jobs to Zambian youth.
As the industry scales, it will demonstrate how innovative start-ups can be role models for economic development in the region. Together, we can unlock a new generation of jobs for young Africans in a sector otherwise overlooked by the status quo.
Dimitri Zakharov is CEO and Co-Founder of Impact Enterprises, a socially conscious outsourcing company that provides lead generation, content moderation, and order management services with the mission of providing digital jobs for skilled youth in Zambia. Visit Impact Enterprises