Africa’s next economic era will heavily rely on its youth population

Africa’s youth workforce is increasingly moving into services, with retail, logistics, hospitality, transport and other urban-based sectors expected to employ more young people than agriculture by 2033, according to the Africa Youth Employment Outlook 2026.

The projected shift marks a major change in the structure of youth employment across the continent. It is being driven by urbanisation, rising education levels and expanding service-sector activity, according to the report by the World Data Lab, Mastercard Foundation and the University of Cape Town’s Development Policy Research Unit.

Africa has about 532 million people aged 15 to 35, and the youth population is projected to increase by 132 million between 2020 and 2030, according to the report. It says about 304 million young Africans were working in 2025, representing 57% of the continent’s youth population.

The scale of the demographic transition is increasingly shaping economic planning across the continent.

Macenje “Che Che” Mazoka, Zambia’s High Commissioner to the United Kingdom, writes in the African Youth Survey 2026 that “Africa’s place in the world is neither peripheral nor passive… For Africa, this is a moment not only to respond to change, but to help shape it.”

The report says 47% of youth employment was in agriculture in 2025, with about 143 million young people working in the sector. It projects that the services sector will overtake agriculture by 2033 and employ 3.8 million more young workers than agriculture.

According to the report, services are projected to grow 2.4 times between 2015 and 2040, compared with 1.3 times for agriculture. The report says service-sector jobs are more likely to be formal, with about 20% of service jobs classified as formal employment, compared with 2% in agriculture.

Income data from selected African countries also point to higher earnings in services. According to the Africa Youth Employment Outlook 2026, young people working in services earned about 2.6 times more than those working in agriculture in 2024.

The International Labour Organization says agriculture remained the largest employer of young people in sub-Saharan Africa in 2021, accounting for about 60% of youth employment. The ILO says the shift away from agriculture has been accompanied mainly by growth in services, particularly in trade, transport, accommodation and food services.

Urban employment is also expanding. According to the Africa Youth Employment Outlook 2026, the number of young Africans working in urban areas increased from 85 million in 2015 to an estimated 115 million in 2025, with urbanisation supporting the growth of service-sector employment.

The reports show that the expansion of services has increased employment opportunities, while a large share of youth work remains informal. According to the Africa Youth Employment Outlook 2026, 90% of employed young Africans were in informal jobs in 2025, and 104 million of the 304 million young workers were living in households below the international poverty line.

The report says more than 10 million young people enter the African labour market each year, while current growth patterns generate about 3 million formal jobs annually. The ILO says 53 million young people in sub-Saharan Africa were not in employment, education or training in 2023, equivalent to a youth NEET rate of 21.9%.

The employment transition is reflected in the priorities identified by young Africans themselves.

According to the African Youth Survey 2026, “for the first time across all waves, jobs and corruption emerge as equal priorities for the years ahead, reflecting a generation navigating economic anxiety alongside an enduring demand for accountability.”

The survey found that 27% of respondents identified creating new, well-paying jobs as the most important priority for Africa’s progress.

The survey also links employment to broader economic confidence. It says “employment opportunity emerges as a central driver” of how young people assess the direction of their countries and economies, with improvements in employment sentiment associated with stronger confidence in several African markets.

Employment opportunities are also increasingly connected to investment and infrastructure.

Emmanuel Kwezi Tabaro, a public policy researcher and former deputy director of the Leo Africa Institute, notes that “young Africans are not uninterested in geopolitics, but they appear far more concerned with the practical realities that shape daily life: jobs, infrastructure, economic opportunity and the cost of living.”

Tabaro says the survey findings point to a practical approach to economic partnerships.

“More than half say partnerships that deliver tangible benefits should take precedence over those based mainly on shared values or ideology,” he writes, linking youth priorities to trade, investment and infrastructure.

Education levels are also changing. According to the Africa Youth Employment Outlook 2026, more young Africans are expected to remain in education for longer, with the report projecting that rising educational attainment and productivity gains in agriculture will result in more young people studying over the next decade.

The report cites examples of countries where youth employment is expanding through services and related industries.

Rwanda and Senegal are identified as countries where tourism and agro-processing have absorbed young workers, while Ethiopia’s Urban Institutional and Infrastructure Development Program created 1.15 million jobs, including 237,000 permanent positions.

The ILO says services employment has expanded across sub-Saharan Africa over the past two decades, while manufacturing has remained a relatively small source of youth employment. According to the ILO, the share of youth employment in agriculture declined between 2001 and 2021, with most of the shift occurring towards services rather than industry.

The labour market transition is taking place alongside growing demand for greater youth participation in economic and political decision-making.

According to the African Youth Survey 2026, “three-quarters of youth believe too few young people hold leadership positions in government,” and a similar proportion said they would be more likely to support parties promoting young candidates. The survey also found that young Africans favour leaders who “deliver jobs and services,” linking employment directly to governance expectations.

The survey identifies employment as a broader development issue. It says unemployment and poverty are viewed by young Africans as the biggest threats to community safety, while job creation is seen as the most effective way for governments to improve security.

Isaac Olufadewa, founder of the Slum and Rural Health Initiative, argues that the challenge extends beyond job creation alone.

“The real question is whether we can build the systems, partnerships, and political will needed to scale” opportunities for young Africans, he explains. He adds that “across the continent, talented young professionals are driving change, yet many lack funding, mentorship, decision-making spaces, and long-term support.”

The Africa Youth Employment Outlook 2026 says the services sector will become the largest employer of young Africans by 2033, making it the principal destination for the continent’s expanding youth workforce over the next decade.

Olufadewa highlights that “Africa’s greatest asset is not her natural resources or markets. It is her people, especially her young people,” adding that investment in young Africans will determine whether the continent’s next phase of growth is defined by “measurable progress.”