The fund proposes targeted worker-level policies and the removal of obstacles to firm growth as some of the necessary interventions.
The Bretton Woods institution further says such efforts should be complemented by policies that support structural transformation towards higher productivity activities to expand meaningful employment opportunities.
This is contained in a recent Regional Economic Outlook Notes titled ‘The Clock is Ticking: Meeting Sub-Saharan Africa’s Urgent Job Creation Challenge’ published by the IMF recently.
The IMF notes that sub- Saharan Africa urgently needs to create jobs for its growing population, especially in fragile and conflict affected states, and low-income countries.
“The region’s labour markets are characterised by high levels of informality and significant barriers to job creation, resulting in too few good jobs. To tackle this, broad-based and inclusive productivity growth, including in the informal sector, is crucial,” the report reads.
UK-based Malawian economist Velli Nyirongo said this is particularly pertinent given Malawi’s reliance on subsistence agriculture and informal trade, which dominate its economy.
He said transforming informality into a viable pathway for employment would require targeted policies that directly address worker productivity and skills while simultaneously removing the structural and bureaucratic constraints.
“This dual approach can help create a more enabling environment for small and medium-size enterprises (SMEs), which are vital for job creation and economic diversification.
“By fostering an inclusive, resilient and dynamic labour market, the country can turn its growing population into a demographic dividend rather than a source of strain. Such reforms will require strong political will, enhanced governance and partnerships with development institutions, including the IMF, to unlock the financial and technical support necessary for success,” Nyirongo said.
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