Can entrepreneurship end youth unemployment?

The Middle East and North Africa (MENA) region has a demographic youth dividend of 200 million bright minds. Any development narrative that does not take into account their aspirations will invariably fail to achieve its desired goals.

But how close are we, in reality, to empowering these young people?

The responsibility to help them fulfil their aspirations on the whole continues to rest with governments.

Increasingly, they are looking to create job opportunities by pumping investment into the social sector or infrastructure development.

The private sector is seen as a silent, compliant, less proactive partner.

But creating job opportunities solely through governmental intervention will not address the region’s growing unemployment problem.

To bring about a transformational change, we must create a vibrant entrepreneurial ecosystem that offers young people in the region the opportunity to be active partners in nation building.

To achieve this, we need to cultivate a talent pipeline equipped to meet today’s requirements.

Developing a pool of talented professionals and preparing them for future challenges also demands a deep understanding of the shifting market and socio-economic realities, as well as the impact of technology on the nature and function of jobs.

An Oxford Martin School study of 2013, covering over 702 occupations, estimated that 47 per cent of total US employment is at risk because of the impact of computerisation on the labour market.

A 2015 study found that the upcoming digital age will cause even more dramatic changes than the office automation or computerisation we witnessed in the past.

With “human tasks” being increasingly taken over by machines, and with the advent of the Internet of Things, young people must be prepared for a new entrepreneurial climate that indeed has no precedent.

As the Oxford report points out, while telephones took 75 years to get to 50 million users, Angry Birds, a video game, took around 35 days.

Disruptive technologies are redefining the employment and entrepreneurial landscape at an unprecedented speed and scale.

For the MENA region, this should not be seen as a problem.

The region’s young people are among the most tech-savvy in the world, helped by strong Internet penetration and broadband connectivity.

A survey among Arab youth highlighted that 82 per cent of them use the Internet on a daily basis, over 77 per cent own a smartphone and 91 per cent visit a social media site at least once a week.

This presents a strong opportunity to create a new culture of entrepreneurship driven by tech-innovation and the ability to tap into the unexplored potential offered by the industrial Internet — the integration of advanced analytics with heavy machinery.

This, in fact, is central to my organisation’s approach to talent development.

Such a shift in outlook is also important from the perspective of socio-economic development. There is an immediate and direct need for industries in the region to be more productive and efficient.

This is true for oil-rich nations as well as for oil-importing nations, which are all aggressively tapping into economic diversification to sustain growth.

Dramatic productivity leaps are called for in all sectors, from energy to healthcare, aviation and transport, to meet growing demand from an increasing population.

The industrial Internet is today enabling quantum leaps in productivity and efficiency, supported by additive manufacturing through technologies such as 3D printing.

The reshaping of the economic and technological landscape demands new skills, which young people already foresee as part of the future of the workplace.

A PwC study showed that 53 per cent of young people think technological breakthroughs will transform the way we work over the next 5 to 10 years.

Also pertinent to the region, 39 per cent feel that resource scarcity and climate change are key determinants, while 36 per cent believe shifts in global economic power will impact the workplace.

When preparing a new entrepreneurial ecosystem, these realities will have to be taken into account.

This means a greater focus on educational and training programmes that are not conventional but tap the potential of frontier technologies.

Revisiting the curriculum to incorporate subject areas covering sustainability, renewable energy, additive manufacturing and big data will become imperative to create this new talent ecosystem.

That is one of the core commitments of General Electric (GE) in MENA. We have been working with academic institutions and our business partners in tailoring training programmes that address the new technological realities.

We have also been investing significantly in innovation hubs across the region, simply because the fast pace of the technological revolution will rewrite the rules of innovation too.

There is only so much of transformational growth that can happen with improvements to existing innovations.

Incremental growth, which is a must to address the region’s future growth requirements, will only come through groundbreaking research and new business models.

That is why we believe in the power of innovation and invest in building local supply chains that are led by young entrepreneurs.

These self-sustaining individuals will define the future of the region. In creating this talent ecosystem, the private sector, with their deep expertise in technology and research, can play a defining role.

The writer is GE’s chief executive officer for the Middle East, North Africa and Turkey. He contributed this article to The Jordan Times.