Africa: How growing digital commerce is impacting employment

Author: David Proteous & Amolo Ng'weno, in The EastAfrican, Published on: 16 March 2019

"What will the popularity of online shopping in Africa mean for jobs?"

In this way, digital commerce is truly a double-edged sword. The question for policymakers in Africa is whether they can help wield it as a positive force for employment, as the phenomenon advances across their region. BFA recently conducted a scenario-building exercise to identify the options facing African policymakers and, as we argue in the full report, we believe that there are choices that will make the outcome more positive for employment...

Accelerating digital commerce alone does not assure positive outcomes for employment. Some researchers have already sounded an alarm around the risk of a “race to the bottom” through global gig work, a growing sector of digital commerce. Employees previously in formal jobs have become “dependent contractors” and not always by choice. This shift away from formal employment in developed countries challenges national labour law and has already resulted in a rash of lawsuits in the US, UK and elsewhere, to define the shifting boundaries of jobs. While gig work is most visible in those countries, the trend is not confined to the northern hemisphere. Cape Town-based research project i2i estimates there are already 4.8 million African so-called “platform” workers...

Policymakers could be able to leverage digital commerce to close the gulf between the conditions and benefits of formal work and the simple income offered by informal work. To do so, Africa’s policymakers could embrace the notion of an iWorker: That is, a working-age digital consumer, who could become a producer selling goods, or services online. By our estimates, extrapolated from the International Labour Organisation’s projections of the labour force to 2030, there could be between 29 million and 80 million iWorkers in Africa by 2030, out of a total labour force of some 600 million. Most of them will be young. For this growing group, digital commerce platforms can offer a new route to progressive formalisation. These platforms can act as hubs for provision of online education. Registered workers could receive access to portable packages of nano-benefits, as well as online recourse mechanisms, if not paid as per digital contract. But these kinds of positive outcomes aren’t likely unless countries reconsider whether their national labour and tax laws, among others, are supportive; and whether their vocational education systems are geared to supporting the skills necessary to thrive in digital commerce.

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