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What is a job, where does it come from, and why job creation shouldn’t be the goal

Having a job is one of the most important anchors in a person’s life as it provides both stability and meaning. In his book, Man’s Search for Meaning, Viktor Frankl observed that when people cannot see a future, they lose the ability to live with purpose. The unemployed worker, he noted, suffers a similar fate.

Jobs not only provide income for most people but also a sense of purpose, hope, and dignity. To say that jobs are important for both individual and national progress is an understatement. 

This is why the world’s most ambitious development institutions have made job creation central to their missions, not as an economic abstraction, but as a human imperative. The World Bank has anchored its agenda around jobs. The Mastercard Foundation aims to enable 30 million young Africans to access work by 2030.

These major organisations are investing billions of dollars to create jobs for hundreds of millions of people globally. Africa, for instance, needs to create one billion jobs by the end of the century. 

Africa is not alone in its quest for jobs. Emerging markets, even as they see an influx of foreign investment, are also struggling to create jobs. They are facing what Ken Stibler of Frontier Markets News calls a “jobless boom.” 

But before we can solve the jobs crisis, we should ask more fundamental questions: what is a job? Where do jobs come from?

A job is a set of tasks that, when performed, creates value for someone willing to pay for it. Three things are important to understand jobs. The tasks must exist. They must be performed. And they must create value for someone. 

That’s simple enough, but where do jobs come from and why would anyone want to create them?
 
It’s important to recognise that no one sets out to create jobs simply because people need them. Initiatives that do this often create jobs that are unsustainable. For example, an analysis of Nigeria’s N-Power Initiative and Youth Empowerment programme found that, “while N-Power has expanded access to temporary employment, skills training, and public services, its impact remains constrained by short-term tenure, weak labour market alignment, and the absence of post-programme integration.”

This is the trap of jobs-for-jobs’-sake thinking. They are not jobs anchored in demand. They’re propelled by subsidies. When the subsidies end, so do the jobs. The more useful question isn’t how to create jobs, it’s how to create the conditions that make jobs inevitable.

Jobs are not created by programs. They are created by consumption. And consumption begins with struggle. The more people in an economy who consume a product or service, the more jobs the economy can create. Bruce Yandle of George Mason University put it this way, “In every case, large and small, in a free society, jobs are ultimately created by consumers and citizens who are willing to pay for goods and services that they value.”

Yandle’s essay reminds me of another short essay by renowned economist Deirdre McCloskey. In it, McCloskey writes that, “The goal of an economy, as Adam Smith taught us, is consumption, not jobs or production.” How can consumption be the goal of an economy? But when we slow down and consider what happens every day in our economies, we realise that consumption is indeed the goal.

Life is lived in moments of struggle (nonconsumption) or consumption, with little in between. An easy way to understand this is to think about when you’re hungry. That’s a struggle. Eating is consumption. When you’re sick, that’s a struggle. Taking medicine, seeing a doctor, or resting is consumption. In the big and the small, life ultimately boils down to struggle and consumption. At any given moment, we are either struggling or consuming.  

Our ability to create economies in which people can more easily access products and services that help them alleviate their struggles is directly proportional to our ability to create jobs. No amount of job programmes, skills development initiatives, infrastructure development, or tax policies will substitute for finding ways to increase consumption. Each of these initiatives can help, but only when they are designed to boost consumption.

Consumption is so important because it closes the loop in the socio-economic cycle. People are educated and skilled, so they can provide value that others consume. Production facilities are built to manufacture goods (food, medicines, clothes, etc.) that provide value when consumed.

The billion jobs Africa needs won’t come from programmes designed to produce employment. They’ll come from building economies in which more people can consume more of the things that matter to them. It’s why our work is so focused on market creation: the phenomenon of transforming nonconsumption to consumption. When we create new markets that enable consumption, the jobs will follow.

Efosa Ojomo is a senior research fellow at the Clayton Christensen Institute for Disruptive Innovation and co-author of The Prosperity Paradox: How Innovation Can Lift Nations Out of Poverty. Efosa researches, writes, and speaks about how innovation can transform organisations and create inclusive prosperity for many in emerging markets.