Fossil fuel development, including oil, gas and coal, can provide or support employment in a number of different ways. Estimates for Africa’s extractive sector as a whole put it as employing less than 1% of Africa’s workforce (Fine et al., 2012). However, it is hard to determine the number of jobs supported directly or indirectly by the fossil fuels industry in different African countries due to a paucity of publicly available data and a lack of robust data.
This rapid review includes case studies of five African countries (Angola, Ghana, Nigeria, Sudan and Uganda) including information on their local content policies and government requirements for employing locals and procuring goods and services from local companies. A number of developing countries in Africa with fossil fuel industries have developed local content policies to stimulate local employment and backwards linkages. These policies have had mixed success (Ackah & Mohammed, 2018). Information on whether local content policy requirements are being followed or implemented is limited for the countries included in this review. For example, it is difficult to assess the success of Angola’s local content policy due to a lack of openness and inadequate monitoring and evaluation (Ovadia, 2014).
Information related to gender was extremely difficult to locate. Gender-specific information was only found for Sudan, where 6% of people employed in the extractive sector are women (UNCTAD, 2016). Information on the types of jobs supported was also difficult to locate, aside from Ghana, where a 2015 government estimate suggests that targets for direct local employment were met for management and other staff, but gaps remain for technical staff.
Within the literature consulted for this review, there is a sense that the fossil fuels industry creates few jobs and is an enclave industry, delinked from national economies and the communities in which it operates (Ovadia, 2014; Ablo, 2019). However, multinational oil companies, national governments and development partners have argued that well-governed fossil fuel sectors can contribute to development in developing countries in a number of ways including stimulating employment directly and through backwards linkages (Gamu, Le Billion & Spiegel, 2015).
Whilst exploration and production creates ‘very little employment’, which may favour foreigners due to the skills and expertise needed, the fossil fuels industry’s impact goes beyond these upstream activities (Ovadia, 2014; Africa Centre for Energy Policy, 2017). Through their operations and capital investment, oil and gas companies buy goods and services from suppliers and contractors, who in turn employ people and buy goods and services of their own (Africa Centre for Energy Policy, 2017). As such, backward linkages, through purchasing goods and services from local companies may be more important than direct employment (Ovadia, 2014). This review located a number of examples of local companies providing services to the industry, but scant estimates of the size of indirect employment in the industry. Two estimates were found for Nigeria (38,000 and 200,000 respectively). However, it was not possible to assess the validity of these estimates.
A number of potential countries for inclusion were identified including Nigeria, South Sudan, Sudan, Ghana, Angola, Kenya, Mauritania, Uganda, Cameroon, Tanzania, and, Mozambique. Due to the limited timeframe for this review, it was not possible to include all 11 countries. Hence, Angola, Ghana, Nigeria, Sudan and Uganda were selected to provide a range of examples from a long-established fossil fuel sector to more recent sectors that have come online. An additional consideration was the paucity of publicly available information. Estimates for different countries suggest that the number of jobs supported is small in comparison to the size of the labour force:
- Angola: TOTAL Angola employed 2,200 people in 2013/14, 74% were Angolan; TOTAL and BP created 5,300 indirect jobs through local content initiatives. However, in 2018 the estimated labour force was 12.7 million.
- Ghana: estimates include 5,590 people directly employed in 2015, and 7,000 directly employed in 2014-16. The estimated labour force in 2018 was 12.5 million people.
- Nigeria: 38,000 jobs created since 2009 (2013 estimate) with Shell Nigeria employing 2,790 people directly at the end of 2018 (96% Nigerian) and Chevron employing 5,377 Nigerian employees and contractors at the end of 2017. The estimated labour force in 2018 was 60.7 million.
- Sudan: Sudapet had 1,349 direct employees in 2015 with 23% being women. 2009 CNPC estimate argues 80,000 job opportunities have been created over time. The estimated labour force in 2018 was 11.7 million.
- Uganda: The Government of Uganda estimates 11-13,000 direct jobs and 100,000-150,000 direct and indirect jobs during construction. The estimated labour force in 2018 was 16 million.
The evidence base for this review was extremely limited. The following sections include a mix of academic studies assessing the local content policies of different countries, and oil and gas companies’ annual reviews and corporate social responsibility reports. Little information could be found for the employment impacts of coal mining in the case study countries. Common themes in the evidence base include:
- The number of direct jobs is usually larger during construction than the operation phase. For example, the company Anadarko stated in 2018 that they expect to employ 3,500 Mozambicans at the peak of their construction phase and 1,500 over the 30-year production period. There will also be opportunities for local companies in catering, construction materials, electronics, and other equipment
- A number of oil and gas companies present their information in terms of % for employment with no break down by number or job type. For example, the Italian oil company Eni states that in 2018 it employed 10,374 people outside of Italy, 82.6% of them local.
- Local companies face a number of challenges in providing goods and services for the industry, and capacity building initiatives have been established by both national governments and multinational oil and gas companies.
- Development of renewable energy sources has the potential to create more jobs than fossil fuels (UN, 2018).