Entrepreneurship can help the youth create jobs

Entrepreneurship is a hot topic on the economic agenda, receiving government attention in view of its value in helping address the high rates of unemployment. As education becomes more readily available to this generation, many students are graduating from university. However, the formal job market slowdown cannot generate enough opportunities for young graduates. This results in the high unemployment rate, which exceeded 18.5 per cent in the fourth quarter of 2017.

In light of the hard economic conditions and high unemployment rate, the government has given importance to self-employment and entrepreneurship. His Majesty King Abdullah has also paid special attention to job creation for Jordanians, and to focusing on training and rehabilitation projects to combat unemployment as part of efforts to propel the socio-economic development process forward. Supporting entrepreneurship in vocational education and training is increasingly important for the government, as it struggles to improve pathways to the labour market for youth. Given the youth unemployment challenge, entrepreneurship can offer opportunities for the youth to create jobs for themselves and for others. Recently, tangible efforts have been exerted by governmental financial and non-financial institutions to target the graduates of vocational and technical education to promote entrepreneurship and self-employment.

Based on previous experience in this area, the startup business owners seem to be inadequately prepared, and lack the proper entrepreneurial skills and attitudes that are needed to successfully start an enterprise, run it in the market and allow it to grow. Therefore, it is important to ensure that target groups are empowered with the necessary skills, knowledge and understanding to manage their borrowing and investment strategies. Public financial institutions, through their partnership with non-financial institutions, can play a key role in implementing financial education, helping to build the capacity among low-income clients to ensure that they benefit from access to finance through the effective use of these services. Every financial and non-financial service should be designed in a way that would achieve the greater goal of supporting such clients in strategically starting and growing their businesses.

Furthermore, the focus in supporting the vocational and technical graduates should be on promising sectors in governorates, which boost local resources and can meet consumer demand in these governorates with a clear business plan.

Finally, a major challenge can be found regarding preliminary education as well as life-long learning. Entrepreneurship competencies should be integrated into general and vocational education as a stimulus for entrepreneurial behavior in the labour market. In addition, it is necessary to cultivate a culture in which entrepreneurship is seen as a natural career possibility. This should be connected to new developments in vocational guidance in secondary and vocational education. To conclude, entrepreneurship should be increasingly promoted as a real and attractive alternative to formal employment. Development of an “entrepreneurial spirit” is often seen as crucial prerequisite and as the main criterion for deciding who chooses entrepreneurship and becomes successful in that field.

The writer, a component manager at GIZ, is an external consultant at AGFUND, supporting several microfinance activities in the MENA region. He contributed this article to The Jordan Times