Study: Africa Unlikely to Expand Manufacturing

04:39 November 1, 2023

Study: Africa Unlikely to Expand Manufacturing

A recent study says African countries are less likely to follow East Asia’s development model of expanding manufacturing to reduce poverty.

The study predicts a decreasing share of factory jobs for most countries by 2050.

The Center for Global Development (CGD) released the study this week. It said there will be fewer factory workers around the world in 2050. And the paper predicts that, even in poor countries with a lot of low-cost labor, manufacturing job growth will slow down.

China may be an exception out of the 59 countries modeled in the study. The study said that China will continue to expand its share of manufacturing to 43.8 percent in 2050 from 30 percent in 2018 and 10.5 percent in 1975.

The study’s writers said that China will continue its strong manufacturing performance, producing higher-valued products.

This might create some space for developing countries in Africa, Southeast Asia, and South and Central America to start producing the products China will no longer produce. However, it will not be enough for other countries to follow the same development path taken by East Asia in expanding manufacturing.

Charles Kenny and Ranil Dissanayake of CGD said that many countries will move straight from agriculture to services. They say jobs will greatly expand in services because of new technologies – even in countries such as Bangladesh and Ethiopia.

“There’s still a popular idea that low-income countries will progress naturally from being dominated by agriculture to manufacturing-led growth, but mounting evidence suggests that’s not going to happen,” said Kenny. He said people think that farms are going to empty out across Africa and Asia in the coming years, but he said, people are likely to flood into offices and stores, not factories.

The study projects worldwide growth through the year 2050. It aims to predict changes in the economies of 59 countries that make up about three quarters of the world’s GDP and population.

GDP, or gross domestic product, measures all the goods and services produced in a country in a year. GDP is considered a good measure of the size of a nation’s economy.

The study projects that even for the lowest-income countries, the number of factory jobs will just keep up with population growth over the next 30 years. And it projects manufacturing will likely stay a small part of most of these countries’ economies.

Across all low-income countries, manufacturing jobs are projected to remain below eight percent of total employment. The study projects the share of manufacturing jobs in high-income countries will continue to fall, to 8.3 percent by 2050 from 11.4 percent currently.

Jobs in private service industries are expected to make up 37 percent of worldwide jobs by 2050, and 26 percent in low-income countries. That is up from about 12 percent currently.

I’m Gregory Stachel.

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