CAUSES AND CONSEQUENCES OF YOUTH URBAN UNEMPLOYMENT IN

CASE OF SAWLA TOWN, SOUTHERN ETHIOPIA

A RESEARCH PROPOSAL SUBMITTED TO THE DEPARTMENT OF FINANCE

AND DEVELOPMENT ECONOMICS OF ARBAMINCH UNIVERSITY IN
PARTIAL FULFILLMENT OF THE REQUIREMENT FOR BACHELRO OF ART
DEGREE IN FINANCE AND DEVELOPMENT ECONOMICS

PREPARED BY: MESERET KINDIE

ID NO.RBE/700/10

ADVISOR: MIHRETU TESFAYE (MSc)

FEBRUARY, 2020

SAWLA, ETHIOPIA

I
 ACRONYMS
CSA Central Statistical Authority
ILO International Labor Organization
LDC Less Developed Countries
NGO Non-governmental Organization
MOLSA Ministry of Labor and Social Affairs
OECD Organization for Economic Co-operation and Development

MODFD Minster of finance and economic development

SSA Sub Saharan Africa

II
Table of Contents
ACRONYMS........................................................................................................................................I
CHAPTER ONE...................................................................................................................................1
1. INTRODUCTION............................................................................................................................1
1. 1Background of the Study.............................................................................................................1
1.2 Statement of the Problem............................................................................................................2
1.3 Objective of the Study.................................................................................................................4
1.3.1Specific Objectives of the Study............................................................................................4
1.4 Research Questions.....................................................................................................................4
1.5 Scope of the Study......................................................................................................................4
1.6. Significance of the Study...........................................................................................................5
1.7. Organization of the Study...........................................................................................................5
CHAPTER TWO..................................................................................................................................6
2. LITRATURE REVIEW....................................................................................................................6
2.1. Theoretical Review....................................................................................................................6
2.1.1. Concepts and Definitions....................................................................................................6
2.1.2. Types of Unemployment.....................................................................................................7
2.1.3. Youth Unemployment.........................................................................................................8
2.1.4. Characteristics of Youth Unemployment.............................................................................9
2.1.5. Causes of Youth Unemployment.......................................................................................10
2.1.6. Consequences of Youth Unemployment...........................................................................11
2.2. EMPIRICAL LITERATURE...................................................................................................12
2.2.1. Unemployment in the Developing Countries.....................................................................13
2.2.2. Youth Unemployment in Sub-Saharan Africa...................................................................13
2.2.3 Youth Unemployment in Ethiopia......................................................................................14
2.3 Conceptual framework of the study...........................................................................................15
CHAPTER THREE.............................................................................................................................16
3. METHODOLOGY..........................................................................................................................16
3.1 Description of the Study Area...................................................................................................16
3.2. Type of Data and Methods of Data Collection Technique........................................................17
3.2.1 Data Source and Data Type................................................................................................17
3.3. Sampling Procedure and Sampling Size..............................................................................17
3.3. Sampling Technique and Sampling size determination........................................................17

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 3.4. METHODS OF DATA ANALYSIS........................................................................................18
CHAPTER FOUR...............................................................................................................................19
4. BUDGET PLAN AND TIME SCHEDUEL...................................................................................19
4.1 Time Schedule...........................................................................................................................19
4.2 Budget Plan...............................................................................................................................20
REFERENCE......................................................................................................................................21

IV
 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, 2008) 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 (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 country side 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, 2015) 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-Unemployment Survey

V
concludes, in urban Ethiopia, the labor force grow up with an increasing proportion whereas
the country’s employment opportunity is very limited space. 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.

The youth population in Ethiopia is projected to grow in absolute terms from about 15 million in
2005 to 26 million in 2013, but would remain at about one fifth of the overall population during
this period (CSA, 2005). 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.

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. (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 (Frank,
2015)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

VI
individual to nation level in respect to economic, social and political aspects. Syson, (2011)
also added, 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, 2015). 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)).

The challenge of youth unemployment in Africa is especially large. In sub-Saharan

Africa,youth people aged 18-24 account for 36% of working age population. Due to
population pressure the number of young people looking for work is expected to increase by
28% in the next 15 year, equivalent to about 30 million people. Failure to address youth
employment issues will have serious consequences for the economy and society. Without
opportunity for young people to earn aliving intergenerational cycle of poverty will persist,
further affecting already made vulnerable by HIV/AIDS, food security and violence
(Guarcello, 2007).

As the youth population and grew faster than the total population and youth employment.
The share of the Youth who are employed in the youth population decline from 49.2% to
4.5% between 1997 and 2007 and the total number of Unemployed increase from 63 million
to 71million between 1997 and 2007. In particular sub-Saharan Africa the figure is
estimated 8 to 10 million (Pilgrim, 2009).

High level of unemployment and development is one of the critical socio economic
problems facing Ethiopia. While the labor force grows, with an increasing proportion of
Youth employment growth is inadequate to observe labor market entrants.

As a result, Youth are especially affected by unemployment. more over youth are likely to
be employed in job of low quality, underemployed, working long hour, for low wage,
engage in dangerous work or receive only short term and or/ informal employment
arrangements (Abera, 2013).

VII
There were some studies conducted before in this related problem. For instance the study by
Tesfa Chekole, (2004) on causes of unemployment in the case of Dilla town examined that
it is evident that unemployment affect specially under the age category (21 - 25). The major
cause for unemployment is unfair competitive environment in job vacancies and scarce job
opportunities. Even if they need to start venture, unemployed individual have to go through
aright economic crunch. They get unfair competitive environment in job vacancy this leads
them to venture out to other town for green pastures. Facing a hostile environment which no
employment opportunities makes them frustrated and leads them in to unnecessary activities
like drinking, smoking, gamble and other crimes. Even though such studies were conducted
on that topic the studies in urban unemployment causes and consequences are quite limited.
So the study will try to investigate the major causes and consequence of urban
unemployment in particular area of Sawla town.

1.3 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.

1.3.1Specific 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 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 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.

VIII
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 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 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.

IX
 CHAPTER TWO
2. LITRATURE REVIEW
2.1. Theoretical Review

2.1.1. Concepts and Definitions

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 A. o.,
2015; Pigou, 2015; Pigou A. , 2015; A, 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 F and Jacoby, 2014). 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.
(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

X
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-
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 markets 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 (Hotchkiss, 2015)

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

XI
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. (Agarwal, 2015)

C. Cyclical unemployment: - is the type of unemployment that’s caused by economic

recessions and is the type of unemployment taking about frequently in the news. Cyclical
unemployment is when there is not enough demand to supply jobs for people with in a
country. This type of unemployment with in a country. (www.ehow.com/info-8182767-4-
types-unemployment.htm/).
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 (Smith E. b., 2009)

2.1.3. Youth Unemployment

According to (O'Higgins, 2014)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.

XII
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. Characteristics of Youth Unemployment

O'Higgins, (2014) 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, (2014) 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.

XIII
2.1.5. Causes of Youth Unemployment
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;

XIV
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, 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, 2008)
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 (Mankew, 2013)

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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 (Mankew, 2013)
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. EMPIRICAL LITERATURE

According to the demographic and health survey (2000), two-third of women and 84% of
men who live in urban areas have been to school, while 41% of women and 84% of men who
live in urban areas have reached to secondary level of education. But for more than 80% of
Ethiopia’s population that live in rural areas of educational attainment is substantially lower,
with 84% of women and 58% of men have attained secondary level schooling in rural areas
residents of the heavily urban area of the country. Like Addis Ababa, Dire Dewa and the
Harare region have higher level of educational attainment especially at the secondary level or
higher, Ndegua and powelson 1973 in most developing countries the working age population
has roughly doubles in the past 25 years. It Will double again in the next 25 years, this
growth clearly intensifies pressure on employment and the amount of investment available
per labor market entrants, worst of all in most of the less developed countries (LDCs) 40 to
50% of the population is bracket is taken as is to 65 years, the percentage of population in
this category is considerably less in poor countries is considerably less in poor countries this
bottom heavy age structure of population result in higher ratio of dependent to adult workers
(Meier 2012), the implication is that those working must share their income with those who
don’t work and this leaves less for saving and accumulation.

Moreover, with high population growth, a good deal of the national income is spent on the
expansion of social serving. From 1997 to 2007 worldwide youth participation rates
decreases will youth in activity rate (non-participation in labor force) increased(55.2 to 50.5

XVI
and 48.8 to 49.5 percent respectively. These changes are explained by increase participation
in full time participation rate for the standard definition of the youth age group 15-24 does
not hold true for the age group 15-29 (ILO, 2008).

The force participation rates for this group remains constant over time, indicating that the
decline in youth labor force participation rate (for the formal group) is mainly a passive side
effect of longer education terms. Namely, the post phoning of labor force entry beyond the
years that defines youth (ILO, 2008). O’Higgins (1997) ill poor force participation in full
time education. He also showed that the rate for teenagers (15-19) and youth adult issues that
youth face in the labor market (ILO, 2008).In both developing and industrialized countries,
youth are most susceptible to issue such as “long working hours, work with short term or
informal contract low pay and little or no social protection” ( (ILO, 2008)

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

XVII
boarder definitions of youth. By 2015 the population aged 15-24 years in sub Saharan Africa
is expected to reach some 200 million, 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 Burkina Faso 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.

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%

XVIII
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

XIX
 CHAPTER THREE
3. 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 6o18'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.(Defaru debebe, et al,2016).

Figure 3.1 Map showing the location of Demba Goffa District and the research sites. Source:
BoFED (2019).

XX
3.2. Type of Data and Methods of Data Collection Technique

3.2.1 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.

3.3. 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 4 Kebeles of
Sawla town .The researcher simple randomly selected 10 respondents from each four
Kebeles 40 respondents select from the total population.

3.3. 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 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.

2
Z pqN
n¿ 2
E ( N −1 )+ Z 2 pq
Where, n=Sample size

Z=Level of confidence

N= Total population

E= Sample error

XXI
 P= Probability of success

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.

XXII
 CHAPTER FOUR
4. BUDGET PLAN AND TIME SCHEDUEL
4.1 Time Schedule
NO Task Nov des Jan Feb mar Apr May Jun

1 Title submission

2 Literature review

3 Submission of
proposal

4 Data collection

5 Data analysis

6 Conclusion and
recommendation

7 Writing the paper

ss8 Ratification

9 Submission of
paper

10 Advisor contact

XXIII
 4.2 Budget Plan

No Item Unit of measurement

Quantity Unit of price(birr)
Total price(birr)

1 Paper Ream 1 150 150

2 Flash 32 GB 1 260 260

3 Pen Pieces 6 6 36

4 Telephone cost - - 200 200

5 Transportation - - 300 300

6 Print cost - 50 2 100

7 Internet - - 100 100

8 Total 1146

XXIV
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Brooman F and Jacoby. (2014). Macroeconomics,second edition.
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Defaru debebe.ET al. (2016, june 23). endognious conflict resolution instiution;a study among the gofa
peoele of the demba gofa district,SNNPR. Esayas Awash, vol ,6, 26-33.
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ILO. (2008). world employment unemployment report,Geneva.

Mankew, N. (2013). Macro Economics, Second Edition,Harvard University Press.
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