Two and a half billion people depend on small farms for livelihood and employment. In Africa, agriculture contributes one third of GDP and provides livelihoods to more than 65% of its workforce.
As global food production and demand evolves, agriculture has the potential to create jobs and livelihoods for the bottom 40%, including rural youth and women. In 2013, 74.5 million youth – aged 15-24 - were unemployed. That same year, the global youth unemployment rate reached 13.1%, which was almost three times as high as the adult unemployment rate.
In recent years, agricultural production has increased and livelihood and economic opportunities in rural areas have expanded. Globally, about 40 million enterprises-- from very small to medium-sized—are now involved in agribusiness. Non-farm jobs in rural areas and small towns have expanded to offer new opportunities for rural youth.
Four strategies have emerged for providing the bottom 40% access to more, better, and inclusive jobs in agriculture and related sectors in rural areas:
1. Develop mechanisms for aggregating produce: Small farmers need mechanisms—such as producer organizations, companies or other institutions-- that aggregate their produce and help them better deal with markets.
2. Make value chains more inclusive: Empower and engage with different stakeholders along the entire value chain—including women and even NGOs—and orient it towards creating jobs and facilitating enterprises
3. Invest in expanding the SME ecosystem: Invest in the growth of existing SMEs and encourage new ones to emerge
4. Engage youth: Provide youth with opportunities to develop and enhance their skills in order to help them access entrepreneurship opportunities and acquire jobs in agribusiness, non-farm, and rural labor markets. Focus should also be put on social enterprises, incubation for youth entrepreneurs and the use of ICT to create digital jobs that serve agriculture services.
The World Bank supports rural livelihoods and grows agricultural employment in countries through a combination of investment programs and analytics.
Building institutions for rural poor people: Investment programs support building community institutions for rural poor people—particularly small and marginal farmers—and enable them to aggregate their production, increase productivity, and gain access to extension and training, credit, financial services and market opportunities. These programs develop participatory planning, citizen assessment and feedback channels in order to make local government services and markets more accessible—and accountable—to smallholders and communities. They also boost the productivity of major food and cash crops. Finally, they invest in infrastructure such as roads and telecommunications to lower transaction costs, increase connectivity and raise incomes. Support for producer companies, farmer organizations, productive alliances and self-help groups comes under this area.
Developing the job ecosystem: The second set of investment programs supports the development of non-farm sector entrepreneurship and job opportunities, particularly for youth. This is done through business development, incubation, vocational education and skills development. These programs build partnerships with local businesses and the private sector to provide job placements.
The analytics program focuses on identifying and analyzing the drivers of inclusive growth and jobs in rural areas and in the agriculture sector. The Bank’s analytical work identifies opportunities for stimulating entrepreneurship and creating agricultural and rural jobs across value chains and regions. It also evaluates strategies for livelihood development in rural areas, and recommends strategies to enable agriculture to drive non-farm income.
In Afghanistan, the Bank helped thousands of small and marginal farmers and entrepreneurs-- including many rural women—increase their incomes by expanding their access to financial services, business development services, and training and market opportunities for commodities like saffron, honey and dairy.
Across South Asia, programs working with millions of small farmers--mostly women--have helped set up producer companies and self-help groups, and provided access to credit and financial services. These programs have also enabled small producers to trade on commodity exchanges, and trained and placed youth in private jobs.
In Mali, the Bank has supported agribusiness entrepreneurs to start processing mangoes, which has created quality jobs for youth and women. These products are being exported to Europe and have enabled local farmers and entrepreneurs to access global value chains.
In Vietnam, livelihood development, productivity enhancement and market support services have helped many small farmers develop local infrastructure and livelihoods
In Colombia, Brazil, Honduras and seven other countries in Latin America, farmer organizations of small producers partnered with the private sector and civil society to set up productive alliances that enable access to expertise, infrastructure, markets and value chains. These have created new jobs for local farmers, particularly the youth.