THE ROLE OF MICRO AND SMALL-SCALE ENTERPRISES ON IMPROVING SOCIO-ECONOMIC STATUS OF YOUTH

Abstract

Youth unemployment has been a common problem that faces in many urban areas of Ethiopia. In this regard, Micro and Small Enterprises (MSEs) are the main income generating activities of youth operating enterprises in Ethiopian cities and towns thereby contribute to unemployment reduction and poverty alleviation. The main objective of this study was to investigate the role of MSEs on improving socio-economic status of youth in Wolkite Town, Gurage Zone, Central Ethiopia Regional State, Ethiopia. The study followed a mixed research approach with simple random sampling techniques. Both primary and secondary data source were used. Tools of data collection primary sources were questionnaires, in-depth interview, observation and secondary data were collected using desk review. Accordingly, the population of the study consisted of 1687 enterprise owner/chair persons of Wolkite Town Administration. W a s u s e d t o s e l e c t 323 enterprise owner/chair persons and 11 key informants were selected using simple random sampling and purposive sampling respectively. Quantitative data were analyzed using descriptive statistics and Multiple Linear Regression (MLR) whereas thematic analysis was employed to analyze the qualitative data. The result indicated that the MSEs have created not only job opportunities for the youths but also improve their social capital by creating friendly environment. However, many of the micro and small enterprises business owners have to deal with several challenges such as lack of skill and know how, lack of working places, lack of access to credit, and lack of continuous follow up and support services. It also recommends it is advisable that the youths’ are expected to develop confidence, their social status while running their own business and become interested and cooperative for whatever type of jobs available to them through organizing in groups and this in turn maintains safety of the society. Hence, the study further recommends that concerned bodies need to intervene in order to address these challenges and ensure sustainability of these businesses as an alternative development strategy.