ARBA MINCH UNIVERSITY

COLLEGE OF COMMERCE AND BUSINESS ADMINSTRATION

DEPARTMENT OF FINANCE AND DEVELOPMENT ECONOMICS

CAUSES AND CONSEQUENCES OF YOUTH URBAN UNEMPLOYMENT IN

CASE OF SAWLA TOWN, SOUTHERN ETHIOPIA

A PROPOSAL SUBMITTED TO DEPARTMENT OF FINANCE AND

DEVELOPMENT ECONOMICS IN PARTIAL FULFILLMENT OF THE
REQUIREMENT FOR THE DEGREE OF BACHELER OF ARTS IN FINANCE
AND DEVELOPMENT ECON0MICS

PREPARED BY: MESERET KINDIE

ID NO.RBE/700/10
ADVISOR: MIHRETU.T (MSc)

JAN ,2020

SAWLA, ETHIOPIA

ACKNOWLEDGEMENT
ACRONYMS

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TABLE OF CONTENTS

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................................................................................................................................................................................... 1
CHAPTER ONE........................................................................................................................................................4
1. INTRODUCTION..................................................................................................................................................4
1.1 BACKGROUND OF THE STUDY.....................................................................................................................4
1.2 STATEMENT OF THE PROBLEM....................................................................................................................5
1.3 OBJECTIVE OF THE STUDY............................................................................................................................7
1.3.1 GENERAL OBJECTIVE OF THE STUDY.....................................................................................................7
1.3.2 SPECIFIC OBJECTIVES OF THESTUDY......................................................................................................7
1.4 RESEARCH QUESTIONS..................................................................................................................................8
1.5 SCOPE OF THE STUDY....................................................................................................................................8
1.6. SIGNIFICANCE OF THE STUDY....................................................................................................................8
1.7. ORGANIZATION OF THE STUDY..................................................................................................................8
CHAPTER TWO.....................................................................................................................................................10
2. LITRATURE REVIEW.......................................................................................................................................10
2.1. THEORETICAL REVIEW...............................................................................................................................10
2.1.1. CONCEPTS AND DEFINTIONS..................................................................................................................10
2.1.2. TYPES OF UNEMPLOYMENT...................................................................................................................11
2.1.3. YOTH UNEMPLOYMENT...........................................................................................................................12
2.1.4. CHARACTERSTICS OF YOUTH UNEMPLOYMENT..............................................................................13
2.1.5. CAUSES OF YOUTH UNEMPLOYMENT..................................................................................................14
2.1.6. CONSEQUENCES OF YOUTH UNEMPLOYMENT..................................................................................15
2.2. EMPERICAL LITRATURE.............................................................................................................................16
2.2.1. UNEMPLOYMENT IN THE DEVELOPING COUNTRIES........................................................................16
2.2.2. YOUTH UNEMPLOYMENT IN SUB SAHARAN AFRICA.......................................................................17
2.2.3 YOUTH UNEMPLOYMENT IN ETHIOPIA................................................................................................17
CHAPTER THREE..................................................................................................................................................19
3. RESEARCH METHODOLOGY.........................................................................................................................19
3.1 DESCRIPTION OF THE STUDY AREA.........................................................................................................19
3.2. Research Design................................................................................................................................................19
3.3. Sampling Technique and Sampling size..........................................................................................................19
3.5. DATA SOURCE AND SAMPLING PROCEDURE........................................................................................20
3.5.1 Data Source and Data Type..........................................................................................................................20p]

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3.5.2 Sampling Procedure and Sampling Size..........................................................................................................20
3.6. METHODS OF DATA ANALYSIS.................................................................................................................20
3.6.1 Descriptive Method of Data Analysis..............................................................................................................20
4. TIME AND BUDGET SCHEDUEL....................................................................................................................22
4.1 Time schedule....................................................................................................................................................22
4.2 Budget Schedule.................................................................................................................................................23

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 CHAPTER ONE
1. Introduction

1. 1Background of the Study

Unemployment is perceived differently from the personal point of view and national contexts. But the ILO
put the three criteria or conditions to say somebody is unemployed or not. Thus, ILO (2007) defines
unemployed people as numbers of economical active population who are without work, but available for
and seeking work, including people who have lost their jobs and those who have voluntarily left work. It is
a worldwide phenomenon and it is one of the socioeconomic problems common for all countries of the
world (both developed and developing) nations. Unemployment has long been one of the several features
of the urban phenomenon in many countries and some countries suffer by more rate of unemployment than
other depending on their level of economy and strong labor market environments (B. Pauel and Finazir,
2005).

In this context, in Africa in general and Ethiopia in particular, the situation of unemployment is true and
related as seen in the global contexts. This is due to emerging economy and poor labor marketing
procedures. In Africa labor market outcomes tells higher rates of unemployment in urban areas than in rural
areas due to many people come from countryside to towns and cities in searching for better life (ECA,
2005).

Fitsum D. (2014) viewed developing nations experience high rate of rural-urban migration which
accelerating the unemployment problem of urban areas. Fitsum on her journal paper also discussed the
problem of unemployment in the Ethiopian experience. According to her, as any other developing
countries, in Ethiopia, the urban areas are inadequate to absorb the labor market, thus unemployment
presents a particular challenges particularly in urban centers. According to NEPS (2009) also argued even
some improvements in economy Ethiopia yet face high job losses and limited job creation in urban area.
NEPS shows the overall unemployment rate is 22.9 percent in 2004 and 20.4 percent in 2009. This Survey
data states although the decaling rate of unemployment in the country the labor market in Ethiopia in
general characterized by huge inefficiency and under employment. Two years later, the Urban
Employment-Unemployment Survey revealed the rate of urban unemployment rate stood (26.2% in 2003
to 22.9% in 2004 and further to 16.7% in 2006) and but increased 18% in (2011). The Urban Employment-

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Unemployment Survey concludes, in urban Ethiopia, the labor force grow up with an increasing proportion
whereas the country’s employment opportunity is very limited space. According this Survey, though the
decaling rate of unemployment in the country the labor market in Ethiopia in general characterized by huge
inefficiency and under employment. By the same token, World Bank (2007) reported that in Ethiopia, labor
supply by far exceeds labor demand and thus many men and women are looking but unable to find jobs and
stay unemployed. As other regions of the country, the problem of unemployment in Southern Nation
Nationalities and Peoples Regional State (SNNPRS) is a common and increasing from the time to time. In
urban perspective, at different levels of towns of the region unemployment exists as common and more
urban phenomenon. Respect to this, Gamo Gofa zone is one of zone of SNNPRS, of Ethiopia and it is
suffering the problem of unemployment particularly, urban unemployment. CSA in (2007) reported that the
unemployment rate of Arba Minch town is 21 percent. The same source also point out that Arba Minch is
zonal city of Gamo Gofa Zone and still characterizing by large number of urban unemployment in the
region and at zonal level. In Sawla town many women and men seeking job, but they are unable to find job
opportunities and thus staying as unemployed. Associated with this, some of social problems are frequently
happing in the town. Some of these common social problems happening in the town are stealing,
criminality, dishonesty and other negative social vices are highly increased between three consecutive
years 2012, 2013 and 2014 (Gofa Zuria District Police Office, quoted by Esyas, A. 2015).

1.2 STATEMENT OF THE PROBLEM

Unemployment is a serious multidimensional problem facing all age groups of every society. It is not only
a socioeconomic dimension, but also it has socio-political aspects as well. (Sulaimon A. etal. 2015). The
growing mass of urban unemployed and under-employed is regarded by many as a great social problems
and a prime source of human tragedy (C. R. Frank, 2010).

According to him, unemployment may cause people to flee the rural or small towns to big urban centers.
This in turn result high rate of crimes and unemployment to big urban centers. In general, author noted
unemployment can lead to the following consequences: loss of esteem and economic strength,
psychological injury (hopelessness), loss of responsibility, identity and respect, loss of purchasing power
(loss of income), reduction in the tax and revenues of the state. Those all forces individuals as well as the
societies to live with poverty. The poverty level of individuals and societies directly determines the
nation’s economy. Sum up, the consequences of unemployment is multi-dimensions ranging from
individual to nation level in respect to economic, social and political aspects. Syson, (2011) also added,

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today in most of the developing countries the problem of unemployment is more in urban areas than in
rural areas. In the face of Ethiopian’s some progress in economy at least over the recent past years, the
development challenges facing the problem of unemployment especially urban areas (MUDC, 2013).

Likewise, WB (2011) stated that in Ethiopia regardless of its some improvement in economy in recent
time, unemployment is high particular in urban areas and becoming one of the socioeconomic problems in
the country. Urban unemployment has been and is growing areas of concern for the government of
Ethiopia. And recently, it is becoming an urban phenomenon and continues to be serious social problems in
Ethiopia. This is mainly a result of rapid population and labor force growth (on the supply side) and limited
employment generation capacity of the modern industrial sector of the economy (on the demand side).
Observing the trend of unemployment, urban joblessness has been increasing from time to time and its
rates are much higher in urban areas (Zelalem Bezabih, 2014 .In South Nation Nationalities and Peoples
Region, between the four Urban Employment Unemployment Survey periods, the urban unemployment
rate is recorded as 14.1, 15.5, 14.2 and 11.8 percent in 2004, 2009, 2010 and 2011 respectively. Even
though the rate is some extent declining, the figure is higher and serious (CSA, 2011).

In the light of other towns of the country in general and SNNPRS Sawla town in particular, unemployment
is common and persistent socioeconomic problem. A lot of educated and uneducated individuals in all age
groups are unemployed. As a result, they are facing the consequences of the unemployment discussed
above. However, as stated in literature part, almost all researchers were conducted their study at nation’s
capital, regional cities and big towns of Ethiopia and there were less attention was given to small and
medium/intermediate towns of the country. In the same time, they were emphasized mainly on youth age
groups. Because of this facts and realities, the problem of unemployment is not studied well yet in Sawla
town. Therefore, conducting study on the causes and consequences of unemployment has numerous
significances. In this stand, this study would be conducted at Sawla town and it included all unemployed
age groups. This makes the study differ from the previous researchers. After the findings of the study,
researcher would try to recommend possible suggestions to overcome the problem of urban unemployment
in small and intermediate towns of the country in overall and Sawla town specific.

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1.3 OBJECTIVE OF THE STUDY

1.3.1 GENERAL OBJECTIVE OF THE STUDY

The general objective of the study will be to investigate the causes and consequences of youth urban
unemployment in Sawla town, southern Ethiopia.

1.3.1 Specific Objectives of the Study

 To identify the major causes of youth unemployment in Sawla town.
 To identify the major consequences of youth unemployment in the study area.
 To show some policy recommendation about the problem of youth unemployment.
 To assess the trends of youth unemployment in the study area

1.4 RESEARCH QUESTIONS

The following are the research questions of this study that will be answered in the study.

1. What are the major causes that rise youth unemployment in Sawla town?
2. What are the major consequences of youth unemployment?
3. What are the recommendations to tackle the problem of youth unemployment?
4. What seems like the trends of youth unemployment in the Sawla town?

1.5 SCOPE OF THE STUDY

As regard to the scope, the study will be examines the causes and consequences of youth unemployment
in Sawla town, southern Ethiopia. Among the major reasons for choosing Sawla as a study area is the
concentration of unemployed youth in the town due to different reasons such as migration from rural to
urban areas with expecting better life.

1.6. SIGNIFICANCE OF THE STUDY

The significant of this study lies on the contribution it hopes to make to the growth of research in this
title furthermore; it tries to give some insights to the nature, manifestation and current effects of
different factors and determination of urban youth unemployment in Sawla. The study also helps to
make additions to the accounts of the everyday life, events and perceptions surrounding the urban youth
unemployed. Detailed studies of the aspects and the consequences of such youth unemployment
problem is not readily available and a more detailed study is needed to have a better understanding of
the extent and policy implications of the problem. This study seeks to make a rather modest attempt to

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fill the information gap. It tries to assess the socio –economic and demographic characteristics and its
trends over time in the city with the view to recommending possible measure to be taken in the years
ahead to will mitigate the problem.

1.7. ORGANIZATION OF THE STUDY

This study will be organized in four chapters; the first chapter deals with introduction which includes
back ground of the study, statement of the problem, objective of the study, methodology, scope of the
study, significant of the study. Limitation of the study and organization of the study and the second
chapter contains theoretical & empirical review as literatures while methodology in chapter three. The
final chapter deal about the budget plan and time schedule.

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 CHAPTER TWO

2. LITRATURE REVIEW

2.1. THEORETICAL REVIEW

2.1.1. CONCEPTS AND DEFINTIONS

Unemployment is the macro-economic problem that affects people most directly and severely. For most
people the loss of a job means a reduced living standard and psychological disasters. Unemployment is
not a clear cut conception. If it meant simply the number of man /hours that exists over a period during
which people are not employed, it would be so. But nobody seriously proposes to define unemployment
in such a way as to make unemployed when he is both not employed and also desires to be employed.
Moreover the notion of desiring to be employed must be interpreted in relation to established facts as
regards of hours of work per day, rates of wage and a man’s state of health (Pigou, 2015). A person is
unemployed if he is currently available for employment and has actively looked for a job within a past
four weeks, but could not find any remunerative work within the week of the survey. If unemployed
worker has been unable to find a job for so long that he finally gives up hope to get one, he drops out of
the labor force and is no longer called “unemployed” as he goes four weeks without looking for a job
such a person is called a “discourage worker” If sometimes latter new opportunities come out he may be
stimulated again to try his chances there by reentering the labor force. (Brooman and Jacoby, 1970).
Unemployment is the condition of being without some socially acceptable means of earning a living and
the employed are persons capable of labor in needs to work or the suitability of what they can do to the
needs of the society. (John A. Garrty, 1978 cite by Andualem Esthete, 2012).

Employment is sufficient for a person to be engaged in an economic activity for at least one during the
reference period to be classified as employed. In this frame work unemployment is considered an
extreme situation of total lack of work (ILO, 1990). Youth is compromises young people aged 15-24
years inclusive. In practice, the operational definition of youth or young people varies widely from
country to country depend on cultural, institutional and political factors. In industrialized countries and
in the central and eastern European transition economies, the lower age limit usually corresponds to the
statutory minimum school leaving age, the upper limit tends to vary more widely. In the united
kingdom, for example introduced in 1998 “youth” refers to 18-24 age group, with 16 to17 years olds
getting special treatment, while in Italy the term is used to describe policies for people aged between 14-

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29(UN,1992).According to the Ethiopian youth police youth constitute the population between 15-29
years of age. The Ethiopian youth policy definition is employed for the purpose of this study, with a
further distinction made between teenagers and adults. Since the problems faced by these groups are
quite distinct.

2.1.2. TYPES OF UNEMPLOYMENT

There are four types of unemployment. These are frictional unemployment, structural unemployment,
cyclical unemployment /demand deficient/ and seasonal unemployment.

A. Frictional unemployment:- It is arises because of the constant flow of people between jobs and into
and out of labor force. Because information in the job market is imperfect and because it takes time for
unemployed workers and employers with job vacancies to find each other. Even when the demand and
supply situation in the labor market is imbalance, some unemployment will always occur as workers
and firms search for the best matches. If information was perfect and mobility was costless, these
processes could be done instantaneously and no unemployment would occur. Since neither condition is
meeting in the real world, an inevitable byproduct of a dynamic labor market is a certain amount of
frictional unemployment. The nature of frictional unemployment suggested several ways in which
public policy could reduce it. An obvious avenue of attack would be improve the flow of job
information in the labor market ,such as with computerized job bank, an improved public employment
service or job fairs where perspective job candidates talk with representatives of different companies .
(Kaufman and Hotchkiss, 2006)

B. Structural unemployment: - It is arises from a basic mismatch between the type of jobs that are
available and the type of people who are seeking jobs. This mismatch may be related to skill, education,
geographical area or age. Unemployment in this case arises not from imperfect information as frictional
unemployment, but from barriers to mobility between labor markets that impede or prevent unemployed
workers from competing for availability jobs. With structural unemployment, job vacancies and
unemployed workers co-exists in the market and in the long run are not easily matched. Unlike
frictional unemployment it tends to be concentrated among certain groups that have been adversely
affected by technological changes, the decline of a major industry, or the movement of jobs to another
parts of the country. (Source)

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C. Cyclical unemployment:- Sometimes it is called demand deficient unemployment. It is the result of
insufficient aggregate demand in the economy to generate enough jobs for those who seek one. With
frictional and structural unemployment, the problem is in ability to match job openings with job seekers.
With cyclical unemployment there are not enough jobs to go around. Cyclical unemployment is closely
linked to the movement of the economy, up and down of the business cycle. Demand deficient
unemployment may have a non cyclical component as well if the economy suffers from chronic low
growth, a condition referred to as “secular stagnation”. Compared to frictional and structural, cyclical
unemployment exhibits much greater year to year variation as the economy expands and contracts.
Cyclical unemployment like frictional unemployment also tends to wide spread throughout the economy
(Ibid, 2006).

D. Seasonal unemployment: is similar to demand deficient unemployment in that it is reduced by

fluctuations in the demand for labors. Here however, the fluctuations can be regularly anticipated and
follows a systematic pattern over the course of the year. For example, the demand for agricultural
employees declines after the planting season and remains low until the harvest season. Similarly the
demand for production workers falls in certain industries during the season of the year when plants are
retooling to handle annual model changes (Ehen berg and Smith ,2009).

2.1.3. YOUTH UNEMPLOYMENT

According to O’Higgins (1997) youth unemployment spread unevenly among young people. A number
of individual characteristics tend to increase or reduce the likelihood that a young person becomes
unemployed. Few of these are presented here.

i). Teenagers versus Young Adults:- The general picture that emerges is that unemployment rates tend
to fall with age, which is true for the majority of countries, with just a few exceptions. In several
countries, the highest unemployment rates are recorded by young adults than teenagers (15-19) and the
prima age (25-54).

ii).Women Versus Men: Generally speaking, female labor participation rates are far lower than those of
young men’s particularly in developing countries. The most usual activity outside the labor force for
young men is education; the principal occupation of young women is house work, with female
participation levels in education being much lower than young men’s. Employment opportunities are
generally more limited for women than men.

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 iii). Ethnic origin: In almost every country there are differences in the employment figures according to
ethnic origins, with the dominant group or groups generally faring better than minority groups.

iv).Young People with Disability: A number of studies have noted their lower rates of the labor force
participation and higher unemployment rates. The differential in labor markets success between people
with and without disabilities seems to increase with age .which may in part be attributed to the tendency
of disabilities to became more severs as people grow older but may also reflect the long term effects of
unemployment at any early age.

v). Regional Disparities: Regional variations in the youth unemployment rate correlate with regional
variations in the adult rate. This means countries with a high level of regional variations in adult
unemployment tend to be characterized by even higher disparities in employment opportunities for
young people.

vi). Education/Skill Level: Unemployment tends to vary with the educational attainment level of
individuals and related skills. For most countries unemployment falls, often dramatically the higher the
level of education. Thus the relative employment and wage prospects of between unskilled workers and
skilled workers have been widening.

2.1.4. CHARACTERSTICS OF YOUTH UNEMPLOYMENT

O’Higgins (1997) find out that youth unemployment has its own features.

1. Youth unemployment rates are higher than adult unemployment rate. The most obvious labor
market characteristics of youth unemployment is that its rate is higher than that of adults though
there are of course few exceptions to this rule in some DCs.
2. Variations in youth unemployment are closely related to variations in adult unemployment.
3. Youth unemployment and labor force participation.

O’Higgins (1997) underlined that the rate of participation will influence the level of youth unemployment
through its influence on the size of labor force participation rate will imply a higher unemployment rate,
other things being equal.

2.1.5. CAUSES OF YOUTH UNEMPLOYMENT

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Any examination of the causes of youth unemployment basically boils down to a discussion the relative
importance of three factors. These are; 1. Aggregate Demand, 2. Youth Wages, 3. Size of the Youth Labor
Force.

1. Aggregate demand: aggregate demand affects youth unemployment in the same way that it affects the
over effects level of unemployment. A fall in aggregate demand will lead to a fall in the demand for
labor in general and consequently for young labor as well as for adult workers. This is a fairly
uncontroversial and self evident statement perhaps of more relevance is the fact that youth
unemployment rates are typically substantially higher and more cyclically variable than adult rates. So
rather than ask whether aggregate demand influences youth unemployment, to which the reply is an
equivocal “yes” a more interesting and relevant question is why do fluctuations in aggregate demand
affects young people disproportionately? There are a number of reasons pointed out by O’Higgins for
why one might expect youth unemployment to be more sensitive than adult unemployment to changes
in aggregate demand. On the supply side it is often argued that young people are more likely than older
workers to leave their jobs voluntarily. Their initial experience in the labor often involve a certain
amount of “shopping around “in so far as circumstances permit, to find an appropriate occupation. The
opportunity cost of doing so is lower for young peoples. They tend to have fewer skills and lower
wages and are less likely to “need “jobs to support a family. Although this goes some way towards
explaining the sensitivity of youth unemployment .there is little debt that it is demand side
consideration that are of more consequence. Simply is cheaper for firms to fire young people than older
workers. Having fewer skills young people embody lower level of investment by firms in training and
consequently involve a smaller loss to firms making them redundant. Furthermore they are less likely
to be subject to employment protection legislation. Almost invariably such legislation requires a
qualify period before it can be invoked and compensation for redundancy typically increases with
tenure so for this reason too, the more recently engaged employees will be cheaper to fire. And this
will obviously affect young people disproportionately.
2. Youth wages;
wages are likely to have a negative impact on youth unemployment in as much as the higher the
relative wages of young workers with respect to those of adults, the more incentives there are to
employee adults as opposed to young people. However this argument relies on the assumption that
young workers are close substitutes for their adult counter parts. In many cases this may not be true,

15
 particularly as regards skilled adult workers. If young people and adults are complementary, in the work
place reflecting different skills, requirements, the wages of young people with respect to adults should
have no influence. In such a scenario, both youth wages and adult wages with respect to other costs will
have a negative effect.
3. Size of the youth labor force: recently much concern has been expressed about the negative
consequence of rapidly growing of youth populations in developing countries. The estimated and
projected youth labor force is likely until 2010 shows that the number of young people in the labor force
is likely decline in industrialized countries, youth populations are likely to increase in less developed
areas. The growth rate may even accelerate slightly in Africa. While the relative size of the labor force
does play a role in the level of youth unemployment, this role is outweighed by the effects of aggregate
demand.

2.1.6. CONSEQUENCES OF YOUTH UNEMPLOYMENT

Youth unemployment brings with it many adverse consequences.

A. Economic consequences; there are no positive aspects of unemployment it really bad for the production
of the economy. Unemployment is an economic problem because it represents waste of valuable
resources when unemployment rate go up. The economy is an effective thawing away the goods and
services that the unemployed workers could have produced the economic less during the periods of high
unemployment means that the economy would be producing less than its production capacity.
(ILO,2006)
B. Social consequences; youth unemployment is a major social problem because it causes enormous
suffering as unemployed workers struggle with reduced incomes. It is a well known facts that
unemployment, a direct relationship with some social problem or anti social activities, like increase
poverty, social unrest, theft, robberies, violence potential psychological harm, loss of motivation and
increase in crime rates. If people do not have as much disposable income as before than it is very likely
that crime level with the economy will be increased.(Mankiew,2002)
C. Waste of human resources; A high level of unemployment implies that a large number of countries
human resource /in most cased trained and skillful workers/is wasted during a long period of
unemployment workers can lose their skill, causing a loss of human capital the cost to society could be
enormous as hinderers of millions of birr may have been spent training staff, only for them to end up
being unemployed.(Mankiew,2002)

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D. Demoralization and Hopelessness; High and sustained unemployment could prove to be a source of
demoralization and hopelessness in the youth.
E. Lack of confidence; people who have been unemployed for a long time, losses confidence in
themselves in terms of interacting with others, speech and even going employment again.

2.2. EMPERICAL LITRATURE

2.2.1. UNEMPLOYMENT IN THE DEVELOPING COUNTRIES

ILO (1998) reported that the number of unemployed people throughout the world has 150 million people
that they were seeking and available for work but could not find it. But few years earlier, the number of
unemployed people in the world has been 140 million people unemployment that now in the third world
countries become one of serious and chronic problems in every least developed countries (LDCs).
According to ILO (2004) report unemployment among youth is a particular problem in Africa. At 21%in
sub Saharan Africa and 22.8% in north Africa, the underemployment rate for youth age 15-24 years was
twice that of the overall labor force in 2003 in sub Saharan Africa underemployed youth male up only
33%of the labor force. This much high unemployment rate for youth holds for both males and females.

2.2.2. YOUTH UNEMPLOYMENT IN SUB SAHARAN AFRICA

A sample survey of youth unemployment under taken by UN in 2007, has estimated that young people aged
15-24 years accumulated for 20.4% of the total population of sub-Saharan Africa (SSA) in 2010. This
figure reflects the united nation definition of youths, however when the boarder definition used by the
Africa union /encompassing those aged 15 to 34 years) is considered the proportion jambs to 34.9% or 1 in
3 people. The region’s population aged 15-24 years totally 177 million in 2010, another 125 million would
be added under the boarder definitions of youth. By 2015 the population aged 15-24 years in sub Saharan
Africa is expected to reach some 200 millions, and the population aged 15-34 years is projected to be 343
million. Thus youth make up a relatively large proportion of the total population in most countries the
region. Many of today’s youth in sub Saharan Africa has suffered the consequence of sever poverty from
birth. In this sense the estimates suggested that the percentages of youth living in poverty are extremely
high. It is estimated, for example that 70% young people in Ethiopia, Benin and Burkinafaso live on less
than US$ 2 per day. These high levels of poverty persist despite poverty reduction strategies and some
improvement economic growth in the region. This suggests that recent policies adopted to revitalize the
economy in Africa are not having much of an impact on youth poverty.

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2.2.3 YOUTH UNEMPLOYMENT IN ETHIOPIA

In 1999 CSA labor force survey reported that about 30% of the total unemployed workers, at a country
level, where out of work for not more than six months of the year while about 15.7% had been out of work
for about 7 up to 12 months. This implies that the transitory or frictional nearly accounted for about 46%.
The sample survey showed that about 54% of those unemployed were being unemployed for more than 12
months, which indicates that structural unemployment was serious matter during the survey year. The 2005
CSA labor force survey, on the other hand, reported that the duration of unemployment was different from
what was observed in 1999, it indicates that about 46% of those unemployed were only out work not more
than one month as compared to 7.6% in 1999. Hence the dominant unemployment type at country level
may be characterized as transitory unemployment accounted for about 75%. According to this recent survey
relatively structural unemployment accounted for about 24%, while the proportion unemployed population
for which duration of unemployment was not stated was 0.5 %. (Guta, 2005/06). According to Ofcansky
and Berry (1991), it is generally difficult to measure unemployment in less developed countries such as
Ethiopia, because of the lack of reliable records and the existence of various informal types work. However,
based on ministry of labor surveys and numerous other analyses, a general assessment of unemployment in
Ethiopia can be made. According to the ministry of labor the unemployment rate increased by 11.5%
annually during 1979 _1988 periods. In 1987/88 there were 715,065 registered unemployed workers in 36
major towns. those 18.2% ultimately found jobs leading the remaining unemployed. The total urban labor
force in 1988/89 was 1.7 million; out of this the ministry of labor indicates that the government employed
523,000 workers. The rest of the labor force relied on private employment or self employment for their
livelihood.

2.3. Conceptual framework of the study

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 CHAPTER THREE

3. RESEARCH METHODOLOGY

3.1 Description of the Study Area

Sawla town was established during Emperor Haile Selassie in 1959’s. It is 514kms (319 mi) far from
Addis Ababa (the capital city of Ethiopia) and 223kms (160 mi) from southwest of Hawassa and
250kms (160 mi) Northwest of Arba Minch.

Sawla (also known as Felege Neway) is a town in southern Ethiopia. Located in Goffa Zone of the
Southern Nations, Nationalities and Peoples’ Region, This town has a latitude and longitude of 6 o18'N
36o53oE / 6.300oN 36.883o E with an elevation of 1,395 meters (4,577 ft.) above sea level. It is
surrounding by Demba Goffa woreda. The town is serving as exclusive transport option for seven
Woreda: Meloko-koza, Basketo, geze Goffa, Oyda, Demba Goffa, Zala, and Uba Debtetsehays.

Based on the 2012 town census, this town has a total population of 46957. The majority of the
inhabitants were protestant, with 49.12% of the population reporting that belief, 45.22% practiced
Ethiopian Orthodox Christianity, and 4.63% were Muslim.

3.2. Research Design

As major objective of this research will to assess and examine urban youth unemployment cause and
consequences, it is essential to plan and formulate research design. The research design for this study is
of cross-sectional study design is because of it is mostly used in social science study; it is comparatively
cheap to undertake and easy to analyze.

3.2. Type of Data and Methods of Data Collection Technique

3.4. Sampling Technique and Sampling size determination

The sampling size will determine through sample size determination formula for finite number of the study
population. This sampling technique will be done at sawla town. Way this technique is selected is that because in

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this study area the number of the study population is large; so that the study will be require determine sample
size.by considering the target population finite population formula for sampling size determination.

n=n/1+ (n-1)/N
Were n=sample size without target population
N= target population
n=sample size with considering target population

3.5. DATA SOURCE AND SAMPLING PROCEDURE

3.5.1 Data Source and Data Type

Both primary and secondary data sources will be used in this study .The primary data obtained from
unemployed person in the Sawla town through structured questionnaires and personal observation will
made to collect additional information. secondary data obtained from different published books related
to youth unemployment ,report of ministry of finance and economic development (MOFED) ,central
statistical authority (CSA), ministry of labour and social affairs (MOLSA) and other related
government documents ,internets books ,and similar sources will be also used as source of data.

3.5.2 Sampling Procedure and Sampling Size

The data are simple random techniques used to select the employed in the study area. the researchers
used to simple random sampling techniques ,due to it gives equal chance for the population and also
due to financial and time constrains, absolute coverage of the entire common unity is not practical for
this study ,in simple random sampling relatively small number of units representing the whole
population .the study will conduct 2 keblles of sawla town .The researcher simple randomly selected
10 respondents from each two kebeles 20 respondents select from the total population ..

3.4. METHODS OF DATA ANALYSIS

In this study descriptive analysis will be used in order to compare between different groups of these
features/youth employment/ under different frame works and to show what kind of trends existed
between them different analyses tool like tabulations, and percentages are employed.

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 CHAPTER FOUR

4. BUDGET PLAN AND TIME SCHEDUEL

4.1 Budget Plan

NO Task No de Ja Fe ma Ap Ma Ju
v s n b r r y n
1 Title submission
2 Literature
review
3 Submission of
proposal
4 Data collection
5 Data analysis
6 Conclusion and
recommendation
7 Writing the
paper
8 Ratification
9 Submission of
paper
10 Advisor contact

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4.2 Time Schedule
No Item Unit of Quantity Unit of Total
measureme price(birr) price(birr)
nt
1 Paper Ream 1 150 150
2 Flash 32 GB 1 260 260
3 Pen Pieces 6 6 36
4 Telephone - - 200 200
cost
5 Transportati - - 300 300
on
6 Print cost - 50 2 100
7 Internet - - 100 100
8 Total 1146

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 Bibliography

 Berhan Abera. (2013).Socio,economic and demographic determinants of Ethiopia;Addis ababa

university Ethiopia.
 Brooman, F. and Jacoby, H.O. (1970), Macroeconomics, Second Edition
 C.R.Frank,j.(2010).Urban unemployment and Economic Growth in Africa ; Oxfored Economic Papers ,
New Series,Vol . 20, No 2,Published Oxfored Universty Press, 20(2),15-221.
 (NEPS).National employment Policy and Strategy Of Ethiopia’Addis Ababa Ethiopia.
 CSA (2007), Population and Housing Census of Ethiopia, AA, Ethiopia.
 ILO (1990), World Employment Report; Geneva
 CSA(2007),Populationn And Housing Census Of Ethiopia,AA,Ethiopia
 Kaufman, B.E. and Hotchkiss, J.L. (2006), the Economics of Labor Markets, Seventh Edition, New
York: McGraw-Hill.
 Kaufan, B,E,and Hottchkiss,J.L.(2006), the Economics of Labour Markets,Seventh Edition,New
York;McGraw-Hill.
 O’Higgins, N. (1997), Youth Unemployment and Employment Policy: A Global Perspective; Geneva.
 Zeelalem Bezabih.(2014).Nature of Youth Unemployment in Kazanchis, Addis Ababa .

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