Can Agriculture Provide Business Opportunities for Entrepreneurs?

Technology and the Internet – not agriculture or livestock – are likely to be the first things that come to mind when thinking about the future of work for young people. This makes sense from a historical point of view, since agriculture dispenses with labor when countries develop. And the traditional ways of producing food do not seem particularly attractive. However, technology and the Internet also open up opportunities for agriculture, and urbanization and changes in diet require new ways of processing, marketing and consuming our food. So, can agriculture provide employment opportunities for youth? 

Less but better jobs in the agricultural sector

First of all, the proportion of agricultural employment is undoubtedly decreasing. This is normal. As countries become urbanized and incomes rise, food expenditures decrease as a percentage of total spending. To help produce other goods and services, farmers accept jobs off-farm. However, the process can only be sustained by increasing labor productivity in the agricultural sector through innovations in production and improvements in market access to sell surplus products. Information and communication technologies (ICTs) contribute in both directions.

Let’s talk about automation. The lack of mechanization in Africa has baffled many observers who, given the current population density and market access in the region, have long expected to see a much higher level of mechanization on the continent. However, there are now indications that this could be starting to happen with the provision of ICT-facilitated services.

At present, the main example is “Hello Tractor”, an innovative platform in Nigeria for the use of tractors using text messages, GPS and smart sensors. This “Uber for tractors” has allowed small farmers to have easy access to tractors, which has resulted in a significant increase in productivity through mechanization. However, there are still many challenges in this area throughout the region, including access to funding, timely availability of support services and the level of reach of initiatives. The temptation to subsidize mechanization should be resisted so that the process remains compatible with market forces, as demonstrated by the factor of the price adjustment coefficient (the price of labor above the price of capital and the price of labor above the price of land).

Mechanization is not the only potential benefit derived from ICTs that increases the productivity of agricultural labor. ICTs also help improve agronomic practices by facilitating extension and, more importantly, increasing farmers’ access to markets (old and new), allowing them to take advantage of their negotiating position and obtain better prices for their products . Farmbook in Africa (i) and MFarming in Tanzania are just some of the latest initiatives that use ICT tools to do that. Better access to markets and higher prices will, in turn, promote the adoption of technologies that improve productivity to increase supplies. This opens up important opportunities for rural youth to increase their incomes in agriculture.

In addition, there are some opportunities in urban areas. For example, between 1,000 and 15,000 agricultural jobs (PDF) have been created in urban centers such as Bamako, Accra and Kumasi, and even in megacities such as Shanghai, urban agriculture is an important part of the economic system.

In some cases, the technologies are quite advanced, such as Fresh Direct Nigeria, an emerging company that recently won the World Economic Forum award for technology entrepreneurship of the year in Africa. Fresh Direct Nigeria is a leader in the peri-urban production of fresh food, which it carries out in stackable containers that have been transformed into farms. In their urban organic farms, (i) where hydroponic methods are used, less water and land is used than in conventional agriculture, 15 times more yield is obtained and high quality products are produced for the population of the cities.

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