DETERMINANTS OF URBAN UNEMPLOYMANT (IN CASE OF

ROBE TOWN, ARSI ZONE)

ARSI UNIVERSITY

A SENIOR ESSAY PROPOSAL SUBMITTED TO THE

DEPARTMENT OF ECONOMICS OF ARSI UNIVERSITY.

BY: HAILEGNA DEBELE

ADVISOR: ASSEFA.D

ARSI UNIVERSITY

COLLEGE OF BUSINESS AND ECONOMIC

DEPARTMENT OF ECONOMICS

JAN, 2020

ASELA, ETHIO
Acknowledgement

First, I Would like to thanks god for giving me the strength and capacity to reach this
stages. Next, I Would like to express my sincere gratitude to my advisor Assefa D. (MSc).
for his comment and guidance towards completion of this research. His tireless effort has
made my research successful.

My beloved family, words cannot describe how wonderful feel to have you as a family,
you have been doing all what could do. I am always begging god to pay back all the favors
you did for me.

My Special thanks also go to robe branch bank workers and all my brothers for their
prompts cooperation for any inquiry when I was in need of their assistance and my Father
and Mother for his moral and material support .My god bless you all.

I
ABSTRACT
This research paper focuses on the data cause of urban unemployment in Robe town
which is highly significant for the policy makers of the town to obtain information on the
issue and can help further researcher as a supplementary document. The general objective
of the study is to assess the cause of urban unemployment condition existing in the town
where as specific objectives of the study constitutes: Assessing trends unemployment
condition existing in the town, examining causes as well as consequences of unemployment
in the town and estimating average duration that one can stay being unemployed in the
town. To get reliable information primary data source which collected through structured
questionnaires as well as books and statistical bullet published by central statistical
authority (CSA) was used and a descriptive method of data analysis was used to explain
the study in manageable way. After analyzing the data using this method, the researcher
reached the conclusion that the determinants of urban unemployment of the town, has an
increasing trend but decreasing rate, absence of vacancy, skill requirement as well as job
experience is the main causes of unemployment and five year are duration of one
unemployed person from primary data. Interdependency, town bottleneck and increased
number criminals and theirs are concluded also to be consequences of unemployment in
the town and to alleviate there macroeconomic condition the study recommends:
Improving educational system, training and provision of a credit facility to the
unemployment, employing balanced urban development strategy, etc.

II
TABLE CONTENT PAGEs

Table of Contents
ABSTRACT..................................................................................................................................................II
TABLE CONTENT PAGEs..............III
CHAPTER ONE............................................................................................................................................1
INTRODUCTION.........................................................................................................................................1
BACKGROUND OF THE STUDY..........................................................................................................1
1.1 Statement of the problem...............................................................................................................3
1.4 Objectives of the study.........................................................................................................................4
1.4.1 General objectives.........................................................................................................................4
1.4.2 Specific Objectives.......................................................................................................................4
1.5 Research Questions............................................................................................................................4
1.6 Significance of the study......................................................................................................................4
1.7 Limitation of the study.........................................................................................................................4
1.8 Delimitation of the study.....................................................................................................................5
CHAPTER TWO...........................................................................................................................................6
REVIEW OF LITERATURE........................................................................................................................6
2.1 Theoretical Reviews.............................................................................................................................6
2.1.1 Concerns and Definitions..............................................................................................................6
2.2 Types of unemployment......................................................................................................................7
2.3 Cost of Unemployment........................................................................................................................8
2.4 Theory of unemployment.....................................................................................................................9
2.5. Empirical Review..............................................................................................................................11
CHAPTER THREE.....................................................................................................................................13
METHODOLOGY......................................................................................................................................13
3.1 Description of the study area.............................................................................................................13
3.2 Sources of data...................................................................................................................................13
3.2.1 Primary data and Secondary data................................................................................................13
3.3 Method of data collection..................................................................................................................13
3.4 Sampling Technique and sample Size...............................................................................................13
3.4 Method of data analysis.....................................................................................................................14

III
CHAPTER FOUR........................................................................................................................................15

IV
 CHAPTER ONE

INTRODUCTION
BACKGROUND OF THE STUDY.
Many economists and institution defined unemployment differently, unemployed are those who
have no jobs while, they are actively searching for a job and are willing to be employed at the
ongoing wage rate”. On the other the current international definitions of unemployment stipulates,
that is sufficient for a person to be engaged in an economic activity for at least one hour during the
reference period to be classified as employed. In this framework unemployment is considered to be
an extreme situation of total lack of work, (BLS, 2019).

Unemployment is widely regarded as major social and economic global problem that attack the
both developed and developing countries, (Negassa, 2014). Unemployment is becoming an
increasingly troublesome issue in many parts of the world. It causes a waste of economic resources
such as the productive labor force and affects the long run growth potential of an economy.
Unemployment gives rise to private and social problems in the society such as increased crimes,
suicides, poverty, alcoholism and prostitution (rafik, 2010) and (Ashipala, 2010). High level of
unemployment rates can also contribute to the spread of HIV/AIDS in developing countries (Henry
and haile, 2003)

According to World Employment and Social Outlook compiled by the International Labor
Organization (ILO, 2018), global unemployment in 2018 remains at a similar level to before a
year’s. Peaking at 5.9% in 2009, once the most acute phase of the financial crises was over, the
world unemployment rate started slowly decreasing. After 2014, it has essentially stabilized
around the 5.5% mark, with a total number of estimated unemployed persons exceeding 192
million. The report also highlights that at the years progress in reducing vulnerable employment
jobs with low-wages and no security or guarantees has stalled. An estimated 1.4 billion workers
were in states of vulnerable employment in 2017, and an additional 35 million are expected to join
them by 2019.

1
Unemployment is a problem for both developed and developing countries. However, the impact
and intensity might differ. According to Rafik et al. (2010), unemployment has been the most
consistent problem in both advanced and poor countries. In 2009 for example, as indicated in the
World Bank data base (2011), the general unemployment rate stood at 20.5% in Ethiopia, 23.5% in
South Africa, 4.3% in China, 5% in Japan, 9.1% in France, 8.3% in Brazil and Sweden and 9.3%
in the US, (fikre, 2011). unemployment has increased due to the global economic crisis of 2007/08
which caused the collapse of aggregate output and led to job cuts, (Fikre, 2011). According to Dao
and Loungani (2010) there were about 200 million unemployed people in the world in 2010, 75%
of which came from the advanced economies and the rest from emerging economies, and the
number has increased substantially since 2007 (fikre, 2011). However, though still high,
unemployment in the low income countries declined during the crisis, (Fikre, 2011).

A World Bank report (2008) identified youth unemployment to constitute a social problem that is
posing major challenges to most African governments irrespective of their socio-economic
development. As explained by (Adejumola ,tayo-olajubutu, 2009), unemployment has been
identified as one of the major causes of social vices, including armed robbery, poverty,
prostitution, political Thuggery, kidnapping and other social crisis. (Musar, 2009), verified this
statement by saying that about 4.5 million enter the labour market every year without any hope of
getting employment for life sustenance, (Rahel, 2015).
According to, (Lincon, 2013 ), unemployment in Africa is associated with social, economic,
political and psychological consequences. Psychological, unemployment usually experience
trauma, anger, frustration, low self-esteem, negative life satisfactions, unhappiness and mental
disorder including depression and acute stress. Unemployment has also contributed to increasing
feminizations of poverty among young women of survival and leads to trafficking for they go
across the Middle East and others part of the world, (Rahel, 2015)

Another explanation may be that urban unemployment might be more serious than rural
unemployment for example in creating political instability. For instance, the recent uprising in the
Middle East especially in Egypt and Tunisia which toppled the respective regimes is motivated by
major socioeconomic problems such as rising unemployment, (Behr andAaltola, 2011).
Dendir (2006) analyzes the case of unemployment duration in urban Ethiopia and concludes that
mean duration is 3 years for completed spells and 4.7 years for incomplete spells. Denu et al.,

2
(2005/07) in a study on the characteristics and case of Unemployment in urban Ethiopia , finds
that the youth are characterized by relatively high unemployment which differs among the youth
group across location, gender and education, (Dendir, 2006). Studies in this paper are concentrate
on case of urban unemployment, duration one being unemployed and consequence of
unemployment in the town.

1.1 Statement of the problem

A research conducted by, (Fadayom, 1992), shows that urban unemployment is higher than rural
unemployment. Youth unemployment has increasingly come to be recognized as one of the critical
development challenges many countries in the continent, (Curtain, 2004). According to, (ILO,
2007), report estimates, the Sub-Saharan Africa region has the highest rate of youth unemployment
(18.4%), the Middle East and North Africa (21.3%).

Unemployment situation existing in Ethiopia is the same due to the population growth, the
unbalanced economic growth and job opportunity in urban areas. Only a small percentage of the
immigrant were able to find job in the urban modern sectors. This problem of unemployment is
exacerbating from time to time. Consequently, immoral crimes and band of thieves seems to be
raising them joblessness, (Ayelekirus, 2003).
Gaining employment in Ethiopia is a major challenge that young people in urban areas in the
country encounter.
Robe is recently experiencing development and high rate of population growth.
Many young people in Robe town are trapped in a very difficult situation of unemployment which
has always caused them untold suffering and living under poor conditions. Government and other
stakeholders like NGOs and private people have attempted to put in place opportunities like in
provision of capital through micro finance institutions but even the educated have remained
unemployed or underemployed and many governmental strategies to address the unemployment
predicament have not had success, (Rahel W. , 2015).
This suggests a need to carry out through studies into the unemployment of town and try to address
the case of unemployment will the main aim for this study.
The reason; why the town was selected is due to high unemployment problem exist in the town and
my research gap is geographical location.

3
Researcher will study case of unemployment, characteristic of unemployment and consequence of
unemployment in the robe town.

1.4 Objectives of the study

1.4.1 General objectives

The general objective of the study is to assess the determinant of urban unemployment in
Robe Town.

1.4.2 Specific Objectives

The study is focusing on the following specific objectives:

 To characterize urban unemployment in the town.

 To study case of unemployment in the town.
 To look at consequence of unemployment in the town.

1.5 Research Questions

Accordingly, researcher would considers the study according to the following research questions.

What is the case of unemployment in the town?

What is the characteristics of unemployment in the town?

What are the consequences of the unemployment in the town?

1.6 Significance of the study

This study is significant to the town policy makers to reduce unemployment problem and to
enhance the per capital income of the residents and also for the further researcher by laying down a
corner stone through making available relevant and useful data.

1.7 Limitation of the study

While conducting the study, researcher were faced a number of different constraint and problem.
Some of the major constraint would faced unemployment is abroad concept and researcher mostly
use primary data and there are budget and time constraints that limit researcher to deal different
variables of the study are a more deeply. There also lack of adequate or enough research
experience for researcher to study more deeply.

4
 1.8 Delimitation of the study
In current world the performance economics development especially in developing countries.
Challenged by many factors. Among these factors the study focus on an unemployment, especially
on case of urban unemployment. The study were limited from robe woreda town to the Robe town,
which is located in Oromia region east Arsi zone. The focus of the study is limited to the case of
urban unemployment in the Robe town and its effect on socio-economic development of the town.

5
CHAPTER TWO

REVIEW OF LITERATURE
2.1 Theoretical Reviews

2.1.1 Concerns and Definitions

Many economists and institution defined unemployment differently, for instance (smith, 2000)
wrote unemployed are those who have no jobs while, they are actively searching for a job and are
willing to be employed at the ongoing wage rate”. On the other the current at the with international
definitions of unemployment stipulates, that is sufficient for a person to be engaged in an
economic activity for at least one hour during the reference period to be classified as employed. In
this framework unemployment is considered to be an extreme situation of total lack of work.

Todaro, 1994 under the title of labor underutilization and some definitional distinction are
distinguished. Five kinds of the underutilization of labor based on time, intensity of work and
productivity.

Open unemployment: both voluntary and involuntary unemployment.

Voluntary unemployed persons are those unwilling to accept jobs for which they could qualify,
probably they have means support other than employment whereas the involuntary unemployed
are those who are willing to work but unable to find jobs.

Under employment: is a situation in which workers works less than they would like to work.

The visibility active but underutilized: those who would actually classify as neither unemployed
nor underemployed by the above definition given.

A. disguised unemployment: those people who seen occupied on form or employed in

government on a full. Time basis through the services they renders may actually require much less
than full time.

B. hidden unemployment: those who are engaged in second choice non employment activities
perhaps job opportunities may not available at the level of education already attained or for women
due to social norms.

6
C. The prematurely retired: this is evident and prematurely growing civil service because in
many countries retirement ages are falling

4. The impaired: Those who may work full time but who intensify effort is seriously impaired
through malnutrition or lack of common preventive medicine.

5. The unproductively: those who can provide the human resource necessarily for productive
work but who struggle long hours with in adequate complementary resource.

2.2 Types of unemployment

Smith, 2000 and other scholars have identified four types of unemployment with their respective
case.

1. Frictional unemployment: results from the normal short run adjustment between supply and
demand of labor. i.e. takes time unemployed works and employers to find each other it maintains
that during periods of growth: workers voluntary level present jobs as enter the labor market in
search of new employment, in periods of decline workers become unemployed because they
choose to work in jobs at lower equilibrium wage.

2. Structural unemployment: this involves a miss match between the workers looking for jobs
and vacancies available even though the number of vacancies may be equal to the number of
unemployed.

The unemployed works lack the skill needed for the jobs or in the wrong part of the country to
takes the jobs offered. That is, it is either very expensive or physically difficult to bring workers to
where jobs are as to train the workers for the available jobs at a given point in time. Structural
unemployment lasts longer and demand management does not eliminate. To reduce this type of
unemployment facilitation and implementation of training programs, subsidization of mobility of
workers, etc are required a long with demand management instruments.

3. Seasonal unemployment: seasonal unemployment arises because of both supply side and
demand side seasonality. Variation in products demand such as seasons of fertilities, lead to
variation in the demand for labor associated with production of what commodity, production
seasonality from the supply side such as have in agriculture produce, leads to seasonal variation in
about demand, (McCONNEL, 2003).

7
4. Demand deficiently (cyclical unemployment: This types of unemployment arises due to
inadequate effective’s aggregate demand. Gross domestic product may not be as high as potential
output because of demand failure. Demand shrink due to expectation which discourage private
investment spending, low government spending or taxes, low private consumption, low net
exports, under demand deficient unemployment condition, the number of unemployed workers far
exceed the numbers of job vacancies or available (smith A. , 2000)

2.3 Cost of Unemployment

Economic cost of unemployment

According to M. shang (1992) idle humors resources was a loss of goods and service and therefore
a loss of real income that unemployed resources. Could have been contributed to the society’s
wellbeing. The economics cause of this cost contribution of goods and services in the economy is
measured as the difference between what may be produced full employment and what is produced
at less than full employment

Social cost of unemployment

Loss income or without income, the head of family cannot play the role in which he/she was and
family suffers from economics and social dependency and important family ties may be in danger.
During unemployment person loses self-respect it is more likely to suffer from related illness.
There also some evidence that higher unemployment leads to increased crime and reliance
(salmon, 1998).

Moreover, the following macro effects are associated due to unemployment problem: Loss of
output due to the economy unemployed could be produce goods and service that the country needs
to have.

Loss of taxes revenue- unemployed people are not earning and they are not paying tax.

The government has lost out. Increasing in government expenditure: the government has to payout
benefits to support the unemployed. A long with the loss of tax this is double whamming.

Loss of profits: with higher employment firms are likely to do better and make better profits. If
they make less profit because of unemployment, they may have fewer funds to invest.

8
2.4 Theory of unemployment
The four major theory of unemployment are discussed as the following.

(A) CLASSICAL THEORY OF UNEMPLOYMENT

The main characteristic of this theory is that the labor market forces of supply and demand respond
to change in real wages.

Thus, unemployment is the consequences of real wages being and remaining too high to allow the
labor market to clear government wage legislation and trade unions are identified as a significant
casual factor. Consequently, unemployment in the classical analysis of unemployment is that
reduces government regulation and reduces trade union router to make labor competitive in the
market (simth, 1997)

(B) NEO-CLASSICAL THEORY OF UNEMPLOYMENT

The NEO classical economic school focused on choice of techniques, i.e. the best cost
minimization bundles of factors production. This approach avoids focusing on the social process
which determines the incorporation of labor power into production. Labor and capital are viewed
as factors of production, as objects and not as social relation with one another, therefore,
unemployment is explained either as a result of factor price, i.e. the relative cheapness of capital in
relation to labor, or on terms of technological consideration related to the non-sustainability of
capital for labor or what has been dominated as factor of production problem (schervish, 1983)

(C). KEYNESIAN THEORY OF UNEMPLIYMENT

. Mr. Keynes claims that the "classical" economists recognized the possibility only of "frictional"
and of "voluntary" unemployment

Keynes recognized some unemployed meant result from the voluntary flow of workers from one
job to another (schervish, 1983). Level these in the wake of the great prison, Keynes (1936)
formulated "involuntary" unemployment as follows: "Men are involuntarily unemployed if, in the
event of a small rise in the price of wage-goods relatively to the money wage, both the aggregate
supply of labor willing to work for the current money-wage and the aggregate demand for it at
that wage would be greater than the existing volume of employment

9
"Voluntary" unemployment is defined as the unemployment "due to the refusal or inability of a
unit of labor ... to accept a reward corresponding to the value of the product attributable to its
marginal productivity

(D) MARXIST THEORY OF UNEMPLOMENT

Marxist analysis like the Keynesian a production is at the aggregate level, “in the Marxist tradition,
unemployment drives from the general and normal anarchism of the market economy in which
what proves beneficial for an individual firm is dysfunctional for the system as a whole. Thus
individuals firm maximize profits and enjoy their cost efficient production at level of employment
that fails to provide employment for the labor force as a whole”(schervish, 1983).

INFLATION AND UNEMPLOYMENT

It is suggested that there is an inverse relation between the rates of unemployment and inflation. In
fact such relation was studied by Philips

The Philip curve is an inverse relationship between the rate of unemployment and the rate of
increase in money wage.

The higher rate of unemployment, the lower the rate of wage inflation, in other words there is
tradeoff between wage inflation and unemployment, (Dorbush, 2001). He also stated that the
relationship pattern of wage inflation and unemployment. Assuming g w is wage inflation with U* -
representing the natural rate of unemployment and U represents unemployment and U represents
unemployment rate then he wrote the simple Phillips curve as:- gw=E (U-U*)

Where E measures the responsiveness of wage to unemployment, this equation states that wages
are falling when unemployment rate exceeds the natural rate of unemployment. i.e. U>U*.

In developing country it is usually inconvenient to look into these relationships because of

impartibility of conventional assumption of economist and in developing countries data are
lacking. For instance, time series data on the rate if an employment is lacking in Ethiopia.

10
MIGRATION AND UNEMPLOYMENT

“In Africa the magnitude of rural-urban has greatly exceeded the capacity of the modern industrial
sector to absorb the migrants so that it can only employ productively a small portion of them. Part
of the problem relates to the nature of the Africa industrialization process itself, a process that has
typically failed to produce growth of job opportunities at anything near the rate of output, (Todaro,
1994).

Todaro indicated three factors that are contributing for high rural urban migration in developing
countries. These are demographic factors, educational and economic factors. firstly, the described
demographic factors, urban migrants in LDCs tend to be young men and women between ages 15
and 24 because young people generally seem-in prefer non- farm jobs, most of which are to be
found in urban area, the second factor that has been mentioned is educational characteristics. One
of the most consistent find of rural migration studies shows positive correlation between
educational facility attainment and migration.

The urban labor force grows as a result of the combined effect of the natural increase in urban area
and from rural urban migration. Todar (1994) has emphasized the role of push and put factors of
migration as important contributors to the increase in unemployment of agriculture and attraction
is town life as exacerbating, the rural unemployment problem. He suggested the heavy rushing of
people in to urban area give rise to socio- economic problems in the town. Also it contributes for
the expansion of informal sector, especially in less developed countries since women are more
vulnerable to the problem of unemployment recommend. The basic solution to the problem must
lie in improving the living and employment conditions in the rural areas to a degree that would
about the inflow to the town.

2.5. Empirical Review

In many countries, different students have been conducted on the topic of unemployment with
different perspectives and case studies. Some of them are discussed as follows for Europe of
understanding the main economic analysis.

Nature and trends of unemployment in developing countries historically, the economics of

developed countries have been described in terms of coniferous transfer of economic activity and
people from rural to urban areas. As urban industries expected new employment opportunities

11
were created, and over the same period. Labor saving technical progress in agriculture reduced
rural manpower needs, (todaro, 1994).

The dimensions of the unemployment’s problem in developing countries go beyond simple lack of
work opportunities. The state of unemployment is different from new developed countries
unemployment problem in the third world have much complex causes and dimension of
unemployment in third world countries .it is associated with poverty low living standard, etc that
have not experienced in the now developed countries (Ibid,2003).

Developing countries in general and African countries in particular have been experiencing long
high unemployment rates the rise in urban unemployment in the regions has been paralleled by
increasing urban poverty. It is this phenomena of “Urban poverty “that forced development
theorists to depart from pass thinking that development constituted to the increase in output in all

Sectors of the economy .on the country rapid increase in population led to a rapid increase in
poverty and unemployment, (Teshome, 1998).

Population growth and unemployment

Population growth without balance economic growth in developing countries is deeply influencing
the labor market and exacerbating the unemployment. In LDCs the demand for jobs considerably
increases with high growth rates, to raise income ,both levels and rates investment has to grow
much faster than the growth rate of the labor force, but there is lack of physical and Social
capital .in LDCS along with structural and technical liquidated renders the supply of our case
inelastic and arise in population leads to greater unemployment and open employment (ILO,1990)
reported that the age structure of the population also indicates how a growing populations
influence unemployment. The age structure of the population in developing countries is
dominantly the youth for instance 40% of the population is below 14 years age. This implies that
the number of young people entering the layout force is exacerbating the problem of
unemployment .as projections in Africa indicate that until 2010 average some 8.7 million new
entrants will enter the labor market every year for which jobs have be found.

12
 CHAPTER THREE

METHODOLOGY
3.1 Description of the study area
Robe town is found in Arsi zone, Oromia regional state. It is far from Addis Ababa at 223 km
distance to the east from the center. The total population number of Robe town is 15169, where as
8123 are male and 7046 is female. The religions followed by the town inhabitants Muslim are
(61.78%), Ethiopia orthodox Christianity (37.77%). The three largest ethnic group are Oromo
(86.11%),the Amharic(11.25%) and the lift number are covered by other population. Oromo
language was spoken as a first language by 84.15%; the Amharic 15.22%. However, these figures
may change over time. It is located at Latitude and Longitudes of 09 036N 39008E/9.000N 39.1330E.
with an elevation of 2435 meters above sea level. Regarding source of income, the economic
activity of majority households is based on trade.

3.2 Sources of data

The required data for study were collected from different sources which includes both primary
source and secondary source.

3.2.1 Primary data and Secondary data

This data obtain by means of questionnaires was added to get more curios information about the
case of urban unemployment in Robe town. Secondary data were collected from different
documents, books and from some source indirectly collected by someone and which have be
passed through statistical process.

3.3 Method of data collection

In order to explore deep information for the study conduct the researcher were collected primary
data by preparing and distributing questionnaires to respondents that was independently filled and
return it secondary data is collected from books, and document .

3.4 Sampling Technique and sample Size

Since it is not applicable enough to cover the cost of the research to address all elements of the
population (total number of households of kebele) the study were conduct in selected (but
representative) sample of households. to conduct the sample selection from the 2 kebele with total

13
 number of households of 15169 two kebele (01 and 02) kebele containing total number of
households of 500 and 520 respectively, will be selected by using simple random sampling
technique using lottery method. The two kebeles is that the households in different parts of the
town are more or less similar in character. That means they are homogeneous in terms of
production, consumption and distribution. Therefore, the researcher would mainly concerned to
find a representative sample from the two kebeles.

Using the simplified formula, (Glenn, 2009)

n= [(z2p) (1-p)]/ [e2],

Where: n is the sample size, Z is confidence level (95% is preferred) estimated by using statistical
tables contained the area under the normal curve which is about 1.96, P is the ratio between total
number of households of the selected (kebele 01 and kebele 02) kebeles and that of the 5 kebeles,
and e is the level of significance or precision (5%), 96 households would be determined. The 96
households were selected by using systematic sampling method which is the simplest, most
flexible and best (avoid bias) type of probability sampling method .The lists of heads of
households would taken from the respective kebele administration offices. In order to avoid
sample bias, using ration formula 47[= (500÷1020) ×96] households and 49 [= (520÷1020) x96
households, where 1020 is the sum of 500 and 520, were taken from kebele 01 and kebele 02
respectively. By doing this, the researcher believe that any sampling error was minimized.

3.4 Method of data analysis

Methods of data analysis that used in the research are descriptive analysis. The descriptive analysis
were employed to describe result that was obtained to provide summary of gathered.

CHAPTER FOUR
DATA DISCUSSION ANDANALAYSIS
14
 Descriptive Analysis
This chapter discuss about the result the researcher come across by collecting data both from
primary data by distributing questionnaires to 96 respondents at two place namely kebele 01 and
02 and from secondary data by reviewing different publications of different periods published by
CSA and other bureaus publication to analyze unemployment trends, causes, consequences and
other stated objectives of the research in the Robe town.

Analysis of Primary Data

According to the above stated process under description analysis the researcher come across the
following data by distributing questionnaires to individuals and summarize the results by tables
and graphs.

4.1 Demographic characteristics of respondents

Under these researcher summarizes the demographic characteristics of respondents like age, sex,
marital status of respondents.

4.1.1Respondents of Sex
Below table shows the sex structure of respondents that researcher over-come.

Table 4.1 Respondents sex

Male Female Total

No of respondent 63 33 96

Percent 65.63% 34.38% 100%

15
 Primary data, 2020 Above tables shows that most of sample of respondents surveyed constitute male
(65.63%) and (34.38%) are females. The researcher uses this sex category for the purpose of analyzing
the severity of unemployment by sex.

4.2 Analysis of unemployment with the variables

In this context, the researcher analyzes unemployment with respect to sex, age,
educational level and duration of respondents staying in the studied area. Accordingly,
there suits that researcher overcome through the study can be illustrated as the following.

Unemployment and sex structure

As shown in table 4.1 the researcher collects primary data from both sex categories.

Among these sex category male account large percent from surveyed respondents where-
as females account less.

The following table summarizes the unemployment status of both sexes.

SEX Employment rate Unemployme Employme

nt r nt r
employe % unemploye % Tota
d d l

Male 35 55.56 28 44.44 63 29.2 36.5

% %

Femal 15 45.45 18 54.55 33 18.8 15.6

e % %

Total 50 52.08 46 47.92 96 47.9 52.1

% %

Computed from primary data, 2020

16
The tables how that out of the total (96) respondents surveyed 46(47.9%) of them a r e u n e m p l o y e d
where- as 50(52.1%) of them are employed. From these males employed accounts 3 5 ( 5 5 . 5 6 %) out of
the total (63) males respondents covered

by the study where-as female account15(45.45%) out of the total (33) females surveyed for the study. In
contrast f rom the whole sample surveyed unemployed population over whelms the employed ones. From
this also males account large portion of unemployed status as they account 60.9% where-as the female
account 39.1% out of the total males and female respondents surveyed. This confirms that
the probability of males to be employed less than that of females or females are less likely
to be employed compared with males. Unemployment rate of both sex is high that of
employment rate from surveyed labor force. In addition to these males unemployment rate
exceed that of females.

4.2.2 Unemployment and educational attainment

Education Total
unempl
Emplo

Ptg of

Ptg of
unepl
oyed

attainment
yed

epl
Diploma 14 8 22 36.36 63.64

Degree 17 4 21 19.05 80.95

Basic edu 9 24 33 72.73 27.27

Certificate 6 13 19 68.42 31.58

Based on table in educational attainments more of these populations with basic education are
unemployed largely. Further as the table shows as the educational level increases the unemployment
decreases. From the table 72.73% of 33 individuals, 68.42% out of 19 respondents,36.36% out of 22
individual and 19.05% out of the total 21 respondents with their respective educational attainment of
basic education, certificate, diploma and degree are unemployed.

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4.2.3 Unemployment and duration of residence

Duration employed unemploye total Present of Present of

of d employment unemployment
residence

Less 5 5 17 22 22.7% 77.3%

year

5-10 year 6 9 15 40% 60%

10-15 14 2 16 87.5% 12.5%

year

15-20 9 1 8 87.5% 12.5%

years

Above 20 1 1 2 50% 50%

Based on table the duration of residence shows the respondents lived less than 5years and
between 5-10 years are highly characterized by unemployment. Respondents who
livebelow5 years accounts 22 of the total sample taken of which 17(77.3%) are seriously
affected by the unemployment. Unemployment statuses with respect to duration of
residence 5-10 years for respondents account15 out of total respondents 9(60%) are
seriously affected by a the unemployment. who live in the town for greater than 20 years
become 50% and 50% are employed and unemployed. This shows that one can be
employed in the town as he/she stays longer in the town.

18
Reasons Employ unemplo Total Ptg empl Ptg
y unempl

50 46 96 52.08% 47.92%

Low 11 9 20 55% 45%

salary

Because 9 27 36 25% 75%

skill and
job
vacancy

Absence 9 11 20 45% 55%

of vacancy

Job 6 14 20 30% 70%

exprience

As the data shows 14(70%) are unemployed due to lack of job experience while 11(55%) of them and
9(47.92%) of them are unemployed due to absence of vacancy and low salary respectively.

Cause of unemployment in Robe town

For analyzing the unemployment in Robe town the researchers consider give cause variables.
Accordingly, unemployment is caused by low salary, absence of vacancy, job experience. Accordingly,
the researcher collects data on these variables to show the extent they cause unemployment in the town is
the following.

The high percent of unemployed household are unemployed due to job experience,
absence of vacancy and low salary in the town. Whereas skill requirement and the

19
absence vacancy are not as much significant causes for unemployment of respondents in
the town. This shows that the existed job vacancy require more job experience in spite of
the educational level of respondents. This is very difficult for fresh graduates from
colleges and universities who do not have job experience and cause them unemployed
largely which account 70%. Absence of vacancy and low salary also accounts 55% and
45% respectively. This intern implies that even if vacancy existed in the town they play
low salary which does not much with what respondents require.

Analysis of secondary data source

The data are gathered through secondary data from different material sources are analyzed according to
the following

Table 4.5 Economically active, unemployed population and unemployment rate.

Years Economically active Unemployed population Unemployment rate

Male Female Total Male Female Total Male Female Total

2009 5420 4853 9650 1345 1475 2820 24.81 30.4 29.22

2010 6342 6243 12585 2344 2434 4778 36.96 38.98 37.96

2011 7112 6744 13856 1256 2094 3350 17.66 31.04 24.17

2012 7252 7143 14395 1196 2532 3728 17.06 35.44 25.89

2013 7434 6752 14186 1452 2400 3852 19.53 36.24 27.15

2014 7349 7948 15297 1618 2712 4330 22.01 32.99 28.30

2015 8434 8122 16556 1724 3112 4945 25.04 32.08 29.20

2016 8456 8649 17106 1514 3452 4966 17.90 39.91 27.80

Source: CSA(2012,2014,2016)

Levels and trends of unemployment

The table shows that the trend of both t h e economically active and unemployed population is
increasing through almost in all the connective years that are both the economically. It has
increased by 77.26%[ (17106-9650)/9650)] were economically active male increased by56.02%[(8456-
5420)/5420)] and females increased by 65.4%.This signifies that the number of females joining
20
economically active labor force exceeds their males counterpart. Similarly, the unemployed population
has increased from 2820 in 2009 to 4966 in 2016.Unemployment of population has increased by 76.09%.
According to the data unemployed females are greater than males which are resulted from increased
trend of economically active female population joining the labor force in the town. Even if
unemployment trend of population increases from year to year increasing trend is uneven

The highest unemployment rate for females is registered in 2016 where as that of males registered In
2015 respectively, this is contributed to increased number of females population growth joining
economically active labor force is significant than males in the town

Consequences of unemployment

As the unemployment is increasing, the following are the consequences of unemployment in

Robe town that the researcher concludes;

-Interdependence of the unemployed people becoming increased on those who have work as the
numbers of employees increases in the town and the researcher concludes the following as the
consequences of unemployment form the personal observation.

The numbers of gangsters, thieves, crimes, etc are increased as the number of unemployed
-
people increased in the town.

Increase in the numbers of street children and youngsters in the town.

-

-All the above consequences combined together and effects of the growth of the town backward

which leads to poor health care as well as poor housing in the town.

21
22
 . CHAPTER FIVE

CONCLUSIONS AND RECOMMENDATIONS

5.1 CONCLUSION
Based on the result of the study, the researcher provides the following conclusions.

 Although unemployment is visible in both sexes, all age groups, at all educational
level the study cover, it is clear that they are not equally unemployed by magnitude.
As the primary data shown males are highly unemployed than females within the same
age group and educational attainment. This conforms the idea that the number of
males joining productive work is less than that of females.
 Age group 15-30 or young age group is highly unemployed labor force category than
the rest of age groups. Because the youth groups have not sufficient work experience
as most of them are fresh colleges or university graduate and are not equipped with
the practical work experience as to put them in a better position and compete in the
available labor market.
 From the study as one increase his/her educational level the opportunity to enjoy
productive labor force/employment status/ increase in the long run because in the short
run he/she can;
 Job experience , absence of vacancy, low salary, skill requirement are the major causes of
unemployment where as sex preference is insignificant cause of unemployment as the
primary data revels in Robe town.

Accordingly, the requires for job experience for a vacancy causes simultaneous existence
of unemployment and vacancy in the town.

According to primary data collected from respondents, under 5 year are mostly remain
unemployed which is very large unemployment spell in the town.

 Even though, the increasing magnitude of unemployment differs from under five year to
the next one, unemployment trend in Robe exhibit, generally increasing trends and increase
in male's unemployment is greater than females counterpart throughout the year. The
researcher concludes from these increase trends of the existence of unemployment
23
 emotions relating unemployment level per year from secondary data to five year of
average duration of an individual's unemployment period respondent's answer.
 Increase or dependency ratio, gangsters, homelessness as well as increase in number of
traffic accident due to increase in street children and urban composition are the
consequences of unemployment in the town.
 Generally, the town is characterized mostly by a labor market with excess labor supply
which obviously lowers the probability of Job offer for the existed unemployment in the
town.

5.2 RECOMMENDATIONS
Improving the educational system: The educational systems must be designed in
accordance with the reality of the country's situation not only theoretical. more attention should
be given to practical at colleges or universities. The general structure of education should not be
based only on theories. Because practical knowledge and skill enable students to have
employable skill and to increase their confidence so that they will be able to invest, innovate,
and create their own self-employment.

Training and credit facilitating to the unemployed; unemployed persons that do not have
any training are not able to compete with the trained persons. So, the government or other
NGOs should provide different kinds of technical training to the those unemployed person to
increase their confidence of competition since most of the unemployed people have a problem
of finance. Giving training only cannot be taken as a solution to the unemployed because
even if the people are with their employable skill they may not find job, so the government
and NGOs should provide them credit facilities which enables them to create their own
employment.

Increasing university or college to industry linkage Now, a day 's industry absorbs large
number of labor force and college or university creates large number of trained professionals
with different skill when university/colleges allow students to see practically what they had
learnt in the class by sending them to the industries that undergo activities that are related to
students skills industries developed a confidence toward new graduated students and they
reduce their attention of asking longer year work experience which severity cause of
unemployment particularly for fresh graduates. This is the reason why most organization
24
requires graduates from well-known universities to apply in their organizations as move of
their documents explains.

Empowering women in the society; From the result of the study males are unemployed
than females so a related policy issue that impact both unemployment and the population
causes to the status of women society should be encouraged. Empowering women and
making them equal decision makers in society both address the population issues and
ultimately reduce unemployment by increasing production and productivity in the so the
society.

Employing balanced urban development strategy; Since favoring only one town or
city urban development creates labor mobility in favor of developed ones, So the
government must follow balanced urban development strategy favoring equal capitals funds
for all Urban. These reduces urban to urban or rural to urban migration of labor force that
reduces unemployment by increasing production and productivity in the society.

Expansion of micro and small scale enterprises; The government must provide necessary
facilitates such as access to land, tax reduction and organizing individuals in the form
of cooperates so as to reduce unemployment in the town also by providing funds for
unemployed.

Establishing unemployment agency; The paper clearly chows that average duration of
unemployed individuals around five year which is too large. To alleviate these problems the
government must establish unemployment agency through which unemployed individual
must report to be unemployed and the agency must act as the mediator between
employer and unemployed person by reducing information gap between two parties which
reduces average duration of unemployment spell of individuals in turn.

25
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