African economies are some of the fastest growing in the world, but that growth is threatening to leave behind a generation of young people. With 200 million people aged 15 to 24, Africa has the youngest population in the world. And yet, 60% of all African unemployed are youth, and that doesn’t count youth who are underemployed in informal jobs with low pay and few advancement opportunities.
High levels of youth unemployment and underemployment create a major barrier to poverty reduction across the Continent. More than 70% of Africa’s youth live on less than US$2 per day. This situation can threaten social cohesion and political stability, as the Arab Spring vividly illustrated. New solutions are desperately needed to create opportunities for young people to find meaningful and gainful employment.
Rwanda exemplifies both the challenge and the opportunity. Roughly 70% of the population is under 35 years old, and the majority of the population works in subsistence farming. Since the 1994 Rwandan genocide, the country has focused heavily on stabilizing and rebuilding through social and economic development. The government is now betting on entrepreneurship as a means to create jobs for thousands of young people moving off farms each year. But like that of many African countries, Rwanda’s private sector is currently dominated by small, informal enterprises that employ just 1-2 people.
Young people have the potential to create innovative new enterprises, but they need support to grow their businesses to the scale where they can create meaningful numbers of jobs. Currently, most entrepreneurship programs focus on cultivating nascent business ideas and business plans. What is lacking is support for working entrepreneurs to overcome the inevitable challenges to growing their businesses, from developing strong management skills to accessing affordable capital. AEC addresses this gap to help young people make vital economic change in their own communities.