African economies are on the move. The continent has been the second-fastest growing region in the world over the past decade. GDP is on course to expand by 4.8 percent in 2012. The acceleration in Africa’s growth over the past ten years reflects fundamental improvements in the macroeconomic landscape, political stability, and the business environment. Our 2010 report Lions on the move: The progress and potential of African economies found that Africa is harnessing its natural wealth, and that sectors across the economy are growing rapidly. These sectors include agriculture, manufacturing, and local services such as retail, banking, and transportation and communications, in addition to the natural resources sector, which was the largest single contributor to growth.
The benefits of economic growth appear to be reaching many of Africa’s people. Poverty is falling. Around 90 million African households had joined the world’s consuming classes by 2011—an increase of 31 million households in barely over a decade. Income inequality, however, remains unacceptably high and is falling in only about half of Africa’s countries; hundreds of millions remain trapped in poverty. Africa’s growth needs to be inclusive if it is to improve human welfare and ensure increasing social and political stability.
Economic growth reaches most people through employment income, so Africa’s challenge is to ensure that economic growth translates into the stable wagepaying jobs that are the key to the continued expansion of the consuming class. Africa has begun to create the wage-paying jobs that are necessary to meet the needs of an expanding labour pool—37 million of them over the past decade. But accelerating the pace will be critical.
In this report, the McKinsey Global Institute (MGI) presents a comprehensive exploration of Africa’s employment landscape. This research includes quantitative analysis of available national employment data, a survey of more than 1,300 companies in five African countries, and interviews with dozens of business leaders and policy makers. We look at employment patterns across countries and sectors, and assess prospects for job creation to 2020. We identify a range of barriers to creating jobs that African leaders must tackle and suggest how policy makers and business leaders can develop strategies for boosting job growth.
» Read more on the MGI Africa at Work webpage