What really is Jobtech?
Written by Gituku Ngene. This story is adapted from the Jobtech Alliance; the full article is available here.
The meteoric growth of internet penetration, mobile connectivity and mobile money in developing countries over the last decade has fuelled a rapid digitalisation across sectors. Education, financial services, retail trade, and agriculture value chains all form the pillars of the new digital economy. Building on this momentum, we are more recently witnessing the digital transformation of labour markets in line with the growth of the digital economy. With high levels of un- and under-employment in developing countries, tech savvy youth, and a well-connected population, it is inevitable that the internet and work platforms will play a much more central role in the labour market in the future.
The rise of digital platforms in developing countries opens new opportunities for informal workers and micro-entrepreneurs, unlocking new markets, formalising informal trades, and generating greater incomes and revenue. For example, Africa’s informal sector employs as much as 83.6% of the workforce — a trend mirrored in other developing economies. This builds a strong case for the rise of work platforms that can formalise and catalyse opportunity within this sector.
Based on this context, this article seeks to unpack the narrative around what Jobtech really is.
Jobtech involves the use of technology to enable, facilitate, or improve the productivity of people to access and deliver quality work.
A recent mapping by Mercy Corps and Briter Bridges indicated that there were over 350 Jobtech platforms in Africa by July 2021. These platforms can be divided into five major buckets as outlined in the diagram below.
Platforms for offline work — digitising an offline market
According to a Mercy Corps report in Kenya, the concept of offline gig work is not at all new to developing markets. Workers in the informal sector have for decades engaged in work on a casual labour basis where they are paid per task or per day.
The rise of digital platforms has transformed these interactions between workers and employers (or clients) by digitising the matching process and creating new efficiencies. One such platform in South Africa is SweepSouth, an online platform that simplifies the process of accessing reliable and trusted domestic cleaners.
“Platforms are opening new markets to a range of workers, reducing barriers to entry and scale and building a level of trust between clients and gig workers” — Towards a Digital Workforce Report
Also in this bucket are job matching platforms, which aim to connect employers to potential workers by addressing search frictions, skill mismatches, and hiring complexities characterised by traditional hiring approaches where past experience and education levels are viewed as indicators of competency. Examples include global platforms like LinkedIn, Workday and Recruit (Glassdoor and Indeed) which have dominated the global job matching market.
And finally, distributed manufacturing models are applying technology to enable the aggregation and sourcing of products developed across different locations. For instance, Shop Soko enables a distributed network of jewellery makers in Kenya to get access to orders of standard products. The rise of technologies such as 3D printing promises to transform the concept of manufacturing and bring sophisticated manufacturing solutions closer to African markets.
Platforms for digitally delivered work
Global platforms like Upwork, Guru, Fiverr, among others, have enabled the outsourcing and redistribution of traditional work into tasks that are commissioned and outsourced to multiple workers. These platforms advertise specific tasks online, which can then be matched to suitably skilled crowd workers regardless of geographical location. While these types of platforms were originally geared toward creating efficiencies and lowering costs, they are unquestionably distributing work to emerging markets and, in the process, creating a new category of imported jobs in developing economies. This work can be a lifeline for youth in countries where there is a widespread unemployment crisis related to ‘missing jobs’ for everyone.
Workers are also turning to other models of distributed online work, such as micro-work. This is a model which breaks down large, complex tasks into minute and individualised tasks that can be delivered by workers with minimum qualifications. Examples include data labelling, annotation, transcription, translation, among others. This allows workers to secure work with limited or no training, choose the type and amount of work to engage in at any given time, and work from anywhere — including using their smartphones through platforms like خمسات (Khamsat), Appen, and Scale AI. Other companies, such as Africa AI Labs, Sama, and CloudFactory, mobilise workers to work within defined physical or virtual spaces and prescribed working hours to ensure better quality control.
Finally, emerging solutions built on the blockchain offer a range of future earning possibilities such as play-to-earn, as has been highlighted here by Jobtech Alliance. This article explores opportunities in this space in more detail.
Digitising microenterprises
These are platforms that provide avenues for small and microenterprises to enhance their sales, inputs, logistics and fulfilment, and payments. They enable retailers to sell their products online by providing marketing solutions and delivery infrastructure that they would not be able to invest in otherwise.
A large fraction of the retail market in developing countries is still informal — characterised by millions of micro traders who depend on traditional sales and marketing models to grow their customer base. The rise of digitisation solutions is an opportunity to transform the sector by formalising retail trade and unlocking new markets. Platforms like OpenSooq in the Middle East create a virtual shopping mall, allowing small and micro traders to create their e-commerce stores and leverage the platform’s marketing, fulfilment, and payment mechanisms to establish an online presence.
Skill building platforms
Given the poor education infrastructure in growing economies, access to quality skill-building opportunities is still a major barrier to entering the workforce. E-learning platforms offer solutions by providing online courses for skilling and training in new-age technologies, allowing existing and new workers to learn through mobile phones, tablets, SMS, and apps. According to LinkedIn Learning, 67% of Gen Z learners said that they spent more time learning in 2020 than they did the previous year. This demand for short-term digital upskilling surged from mid-2020 and has continued to grow. Some examples are Zydii, a digital training platform enabling businesses to offer training through localised digital courses, and Eneza Education which uses SMS platforms for learning. Slatecube
Professional identity, rights, and protection platforms
As the Jobtech ecosystem grows, interventions around worker identification and protection will grow to strengthen the sector, although there is very little activity currently. On identity, global examples have shown the potential to address worker vetting challenges by allowing platforms to establish the authenticity of workers. Solutions are also stemming up to address the issue of worker protection and financial security. For instance, SafeBoda, a motorbike-hailing service has partnered with financial service providers, Watu Credit, Turaco, and Allianz, to offer welfare-enhancement products such as health insurance and home lighting solutions. Pezesha, a Kenyan-based start-up is also focusing on the gig economy and e-commerce by building worker profiles, educating borrowers and unlocking financial products for gig workers and microenterprises.
Clearly the Jobtech landscape in Mercy Corps’ focus countries is rich and diverse, despite being in its early days. However, we are yet to see a full scale of solutions — which is partly attributable to the nascent nature of the sector, as well as the absence of a strong ecosystem to nurture these platforms. We expect Jobtech to evolve as the sector continues to mature and anticipate more players — especially innovators — crowding in over the coming years.
For more information about Youth Employment at Mercy Corps, contact us at youthemployment@mercycorps.org.
