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- Published Jul 16, 2021
Employment creation potential, labor skills requirements and skill gaps for young people A Uganda case study
In order to create jobs, especially for the youth, there is need to raise private investment in labor intensive industries. Besides providing jobs, labor-intensive industries—historically manufacturing—can pave the way for continuous upgrading to higher value-added economic activities.
However, the average share of manufacturing in Uganda’s GDP keeps declining, from 11 percent between 2000 and 2010 to 9 percent between 2011 and 2018. Therefore, manufacturing will not be able to absorb the 600,000 young Ugandans entering the jobs market each year (AfDB, 2019).
In light of the slow growth of the manufacturing sector, Uganda needs to find alternatives for the creation of productive jobs if the country is to achieve its Vision 2040. Service oriented industries that share key firm characteristics with manufacturing firms have the potential to enhance growth and create decent employment opportunities. Such industries are called “industries without smokestacks” (IWOSS).
Newfarmer et al. (2018) classify these as agro-industry, horticulture, tourism, business services, transit trade, and some information and communication technology (ICT) based services.
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