Economic Research Forum (ERF)

Selling hope without reward: youth unemployment in Egypt

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Many young educated Egyptians face difficulties locating secure employment that matches their skill levels and provides a solid foundation for marriage. This column argues that current initiatives intended to tackle the problem are promoting a false sense of hope to youth who become stuck in cycles of precarious work. Policy-makers should instead focus on addressing chronic shortages of secure white-collar work, as well as inequalities in access to capital, education and social connections.

In a nutshell

Egypt is increasingly relying on public-private initiatives – such as soft-skills training, entrepreneurship support and promotion of call centre work – to tackle unemployment among educated young people.

Rather than helping, these initiatives push youth into a cycle of insecure work by extending a cruel sense of hope that hard work will deliver successful careers, while ignoring the structural barriers that limit youth employment trajectories.

If Egypt is to maximise the potential of its youthful population, resources should instead be directed at tackling shortages of secure white-collar work, as well as entrenched inequalities in access to capital, good quality education and social connections.

Youth unemployment in Egypt is concentrated among those with a university education: 34% of graduates are now without work and many more are stuck in insecure, low-status and low-paid work.

Graduates from less privileged backgrounds – those from the ‘koleyyat el sha’b’ (faculties of the people) of public universities, such as law, humanities and accountancy – are especially vulnerable. At the same time, educated Egyptians are being exposed to glamorous international private companies and tech start-ups, which provide high-paid employment to some upper and upper middle class Egyptians.

In recent years, training in ‘soft skills’ and entrepreneurship has emerged as a major supply-side initiative designed to bridge the gap between educated but under-privileged youth and successful education-to-work transitions. The results of my research question the advertised success of these initiatives. I draw on data gathered during 11 months of ethnographic fieldwork conducted between 2014 and 2016 with a group of male university graduates who attended a two-month training course.

Learning to hope

Soft-skills training scholarships are provided by multiple local and global non-profit organisations that obtain funding from development donors and the private sector, as well as international training companies that run programmes with government funding. But this training extends much deeper through self-employed ‘career coaches’ and online material. It is also increasingly implemented in public universities.

Reflecting recent global trends towards ‘non-technical’ employment training, courses offer to provide unemployed public university graduates with the ‘professional soft skills’ to succeed in Egypt’s international private sector: business English; ‘essential labour market skills’, such as interview techniques, CV writing and career planning; and work values/character development, such as self-presentation, communication, teamwork, commitment, problem-solving and time management. They also promise to help graduates obtain what is labelled ‘decent work’, and teach youth how to plan entrepreneurship projects.

The training course was a euphoric experience for graduates who dreamed of becoming entrepreneurs, human resources managers and accountants in multinational companies. They watched videos of Australian executives introducing themselves over work drinks; listened to Apple founder Steve Jobs providing advice; practiced how to speak English in a non-Egyptian accent with a teacher who studied in Europe; learned how to dress (and smell) professionally; and invented imaginary start-up projects.

Participants were also told that the future was in their hands: if they worked hard, addressed their skill weaknesses and remained positive, they would achieve a successful ‘career’ or become a successful entrepreneur. Egypt’s private sector is now ‘meritocratic’, they were told: it rewards hard work and skills rather than ‘wasta’ (nepotism) and class upbringing.

One aspect of the course that caused frustration was the suggested employment path. Participants were told to apply for entry-level service work, predominantly in Cairo’s call centre industry, which has become a major source of graduate employment in recent years on the back of government support, increasing from 600 to 50,000 jobs between 2000 and 2010. These jobs are advertised as ‘decent’ because they adhere to International Labour Organization standards of ‘decent work’: providing a contract, social insurance and a salary of above 1000LE per month ($125 in 2015).

But they have become notorious among Egyptian male graduates because contracts are insecure and temporary. This means that it is impossible to secure acceptance for marriage, and the daily work is stressful and humiliating, certainly not ample reward for years of education. In fact, even though organisations advertise that they help unemployed graduates, many course participants had left call centre jobs in order to take the full-time course and secure better employment.

Rather than accepting this, course designers, trainers and development practitioners generally consider public university graduates to be technically unskilled, and therefore suitable for low-skilled service work. There is widespread criticism of graduates for remaining in ‘luxury’ unemployment, refusing to accept jobs deemed beneath their level.

A major goal of this training therefore becomes convincing graduates to take customer service jobs, in order to secure ‘success’ for the organisation, which is measured through an employment survey after three months. Participants were convinced to do so through an insistence that these jobs will provide a stepping-stone to better opportunities.

They were told that they lack understanding of how modern labour markets work. They still hold on to the idea of a ‘job for life’, a remnant of Egyptian socialism, but now one starts low, switches jobs a lot and builds a career slowly.

If participants continued to ‘work hard’, both in their jobs and through developing their English and presentation skills, and if they saved money and expanded their network, they would climb the career ladder through securing promotion, better jobs in other companies, or establishing a start-up. They were sold the hope of career progression.

Stagnation

By following a group of young men for two years, I observed how this hopeful progression failed to materialise for many of them. They tried to develop themselves through taking English, accounting and computer courses, but they lacked the funds and time outside full-time shift work to do so.

Furthermore, countless applications and efforts to expand connections were not rewarded with promotion, secure white-collar jobs or seed funding to establish a start-up. Instead, they remained stuck in a cycle of precarious, low-paid and low-skilled work, in call centres, outdoor sales and mobile phone shops. Many would spend a few months in one job, before moving on to the next as a contract ended or because of built-up frustration.

Considerations of home ownership and marriage were pushed further and further into the future due to an inability to secure respectable, permanent employment. Over time, what started out as hope was replaced by frustration, anger and, in some cases, depression. These young men had been sold an unrealisable dream.

Their stagnation has consequences for Egyptian society. It represents drastic under-use of a potentially valuable labour resource, which acts as a catalyst for both outward migration, and, according to some scholars, some of the political instabilities seen in recent years.

Rather than helping, current initiatives are making the situation worse by fuelling aspirations without providing a means of fulfilment, while blaming youth for failure thereafter. Their stagnation does not result from a lack of ‘hard work’, but rather from things that are beyond their control, things that are not fixable through a soft-skills training programme.

Future policy directions

Egyptian graduates are victims of a severe shortage of secure white-collar jobs in the labour market. The 1990s halt to government recruitment has never been adequately replaced by a private sector, which remains concentrated in capital-intensive industries. This issue is exacerbated by continued expansion of public education. Call centre jobs, although abundant, do not rectify this shortage.

There must continue to be a drive to increase the quantity of secure, skilled private and public sector work. Although the call centre industry does not represent a long-term strategy, in the short term, ensuring that its jobs are permanent, well paid and respectable should be a priority. Training scholarships must work harder to secure pathways to high-skilled, secure work.

Another major labour market problem is that access to white-collar work is highly unequal. Egypt’s education system has been increasingly driven by the marketplace. Obtaining a good quality education in private schools, private universities and fee-paying faculties of public universities is dependent on economic power, while others are left to negotiate an underfunded free public system.

These youth, including the participants in my research, cannot subsequently address the discrepancies in their technical skills, soft skills and social connections built up over many years. During my research, I found that international companies actively recruit based on private education and employee networks. Even in call centre companies, those working in managerial roles have predominantly had a private education.

Egypt’s government should work to improve free public education, and focus post-university scholarships on technical skills. Action also needs to be taken to remove the growing stigma attached to public education in recruitment processes.

In terms of entrepreneurship specifically, Egypt’s scene remains a highly exclusive space, with large amounts of start-up capital needed at the early stages, and investment opportunities highly dependent on social connections. More effort needs to be made to widen access to start-up investment, particularly in high-skilled sectors.

These suggestions represent a range of possible policy directions. But as my research shows, current initiatives are not solving the problem of youth unemployment and underemployment in Egypt; indeed, they are exacerbating the problem. The country’s youth are ambitious and skilful, and through the right policies, their full potential can be realised.

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