Population, Labor Force aDd Unemployment in Addis Ababa: A Comparative Study of Two Periods

Abstract

The objective of this study is to identify the contribution of
population growth relative to activity and unemployment rates on the
growth of the unemployed population in Addis Ababa between 1984 alld
1994. Component analysis is used to identify the relative contributions
while percentage points are used to assess the changes observed during the
period. The 1984 and 1994 Population and Housing Census reports of
Addis Ababa are used for the study. Unemploymem rale increased by 24.9
percentage points in the decade. Even if the percentage of the unemployed
population with work experience decreased by 2.6 percemage points, the
absolute size of this group increased by 39,672 persons during the period.
The relative percentage contribution of population growth for the increase
in the labor force was 77.5 percent alld that of activity rales was 22.5
percent. The relative percentage contribution of total population growth,
activity rates and unemployment rates were 15.4 percellt, 5.0 percent and
79.6 percent, respectively, for the overall increase in the size of the
unemployed population over the decade. This implies that the major
contributory factor for the growth of the unemployed populatioll, next to the
unemployment rates, was total population growth. It can be can eluded from
this study that 15.4 percent decline in the size of the unemployed population
would be attained by controlling the growth of the total population. Among
others, minimizing the difference between rural and urban areas with
respect to socia-economic services will have a significant role in control/ing
the growth of population in urban areas due 10 migration. In addition,
encouraging and attracting national and illternational investors will have a
major contribution in creating new jobs for the urban unemployed
population.