Recently I had the privilege to listen to a lecture on why we need to create wealth. What stood out for me was that poor people are preoccupied with meeting their own needs first, which is a natural survival mechanism. However, when you are able to meet more than your basic needs, the preoccupation with survival subsides and you are able to notice the needs of others.
Wealth creation is so important because it’s the only way we can stop being preoccupied with meeting our own basic needs and start empowering others to grow and create wealth of their own.
Investopedia defines wealth as the accumulation of resources. The three most basic resources are land, labour, and capital; other resources include energy, entrepreneurship, information, expertise, management, and time. The Sustainable Development Goal (SDG) 8 talks about increasing labour productivity, reducing unemployment rates, especially for young people, and improving access to financial services and benefits as essential components of sustained and inclusive economic growth.
In Uganda, the population is dominated by youth with over 78% below the age of 30. Youth unemployment and underemployment stand at 11% and 26%, respectively. This has been attributed to the small size of the formal employment sector and the limited engagement of youth in the agriculture sector which employs more than 85% of the rural population.
Reducing unemployment, especially among youth, calls for a multi-faceted approach:
- Providing relevant life and technical skills, addressing the gaps between youth's skills and employers' requirements – push factor.
- Linking youth to market opportunities for employment and enterprise development, where they can unleash their talent and innovate. This also includes support for start-ups (start-up kits, business coaching, business incubation, small grants, financial service linkages etc) – match factor.
- Selecting opportunities in growth sectors that have concrete potential for employment creation – pull factor.
Through the Europe Aid-funded Youth employability through Enterprise and Skills development (YES) programme in the West Nile region of Uganda, we are promoting competitive youth enterprises that provide key services to their communities. Youth receive entrepreneurship training and learn how to develop business plans for their start-ups. Consequently, they submit their plans to a grant competition. The grant is often not monetary but specific to the need of the enterprise (eg seeds, fertilisers, sewing machines). In this way, youth can kick-start their businesses. The stories emerging from the programme are phenomenal.
Many youth are thriving and in turn are employing more youth who would otherwise have remained unemployed. People are motivated by and inclined to pay attention to one of their own who has ‘made it’ – we all learn from our peers and oftentimes aspire to be like them.
We identified driven youth in various communities, trained them as entrepreneurs and helped them establish themselves as roles models within their own communities where they would teach and inspire others. This approach has facilitated effective learning and adoption of ideas and promoted accountability among youth who are now more motivated to see each other succeed.
This is one way in which we can help youth create wealth as we continue to align and move our country towards middle income status.
The YES project has surpassed the youth employment target of 5000 people. Around 6000 young people now have jobs.
Learn more about our work in Uganda.
Written by Dorah Egunyu, Communications Officer, SNV Uganda