Flexibility, opportunity and inclusion through online outsourcing jobs

What is online outsourcing, and how could countries leverage it to create new jobs for youth and women? Those are questions we will help answer as part of an upcoming report and toolkit.

The World Bank, in collaboration with our partners at the Rockefeller Foundation, recently met with government agencies and other key stakeholders, as well as the online work community in Kenya and Nigeria, to discuss these issues. Online workers from these countries also presented their stories, including the highly inspirational story of Elizabeth, a retiree who was able to take in an orphan and provide for her schooling, as well as afford a lifestyle upgrade because of her online outsourcing work.
 

Elizabeth, 55, originally worked as a stenographer. Her husband died in 2003, and she is the sole breadwinner for three of her own children and one other orphan who she has informally adopted. She works online on writing platforms, and is currently being on- boarded to start work with CloudFactory. At the moment, she earns between US$50–80 per week working online; this is her the sole source of income, from which she pays her family’s rent, living expenses and short-term loans ^.

“I lost my husband in 2003, so I am the mother and the father," Elizabeth says. "I am self-sufficient. Online work does not confine me to an 8-5 time frame. I can work at my convenience, and I can manage my own home while I work.”

Online outsourcing (OO) is providing this kind of flexibilty and earning potential to millions of people around the world. OO generally refers to the contracting of third-party workers and providers (often overseas) to supply services or perform tasks via Internet-based marketplaces or platforms. Popular platforms include Elance-oDesk (now known as Upwork), Freelancer.com, CrowdFlower and Amazon Mechnical Turk. The industry’s global market size is projected to grow to US$15-25 billion by the year 2020, and could employ at least 30 million active workers from all over the world.

There seems to be significant promise of leveraging OO for jobs in Kenya. It is home to a rapidly growing technology community with a lot of potential for innovation. It also has the tenth-largest population of workers registered on Elance— more than 40,000 Kenyans were registered on the platform in 2014, exceeding any other country in Africa and amounting to more than every other country in East Africa combined.

There is also unfulfilled OO potential in Nigeria. Even though its population of almost 170 million is almost four times that in Kenya, the absolute number of online workers appears to be lower. There are only 22,800 Nigerians registered on Elance.com, which is almost half the number of Kenyans registered on the platform.
 

Kenya and Nigeria, like many other developing ones, face a significant unemployment problem that disproportionately affects young people and women. Kenya, for example, must create one million jobs annually to deal with their growing unemployment rate. OO can help to address this issue head on by helping these population segments gain private sector employment.

The counterparts with whom we met were well aware of this significant employment issue. We are very encouraged by their openness and keenness to explore OO as an option, in spite of the fact that the industry is still relatively new and their experience with OO is limited.

Our discussions lead to the steps that these countries need to take to leverage OO — not only for jobs, but also to increase their service exports and participation in the global digital economy. Some of the key takeaways include the following:

• Countries should maximize and scale up their experience and existing set ups to create significantly more OO jobs. There are existing initiatives in Kenya – such as Cloudfactory, Digital Divide Data and Samasource - as well as brand-new, homegrown online outsourcing platforms such as Kuhustle. There is a growing online worker community that is organized through social networks such as freelancerkenya.com. There have also been attempts to expand OO opportunities to more disadvantaged population segments through the Digital Opportunity Trust.
• Nigeria can leverage lessons learned from the World Bank-supported NaijaCloud initiative; which cited managing participant expectations around provision of laptops as a challenge, as well as properly defining and reaching out to target populations. It can also support nascent homegrown initiative such as Andela, an acceleration program paired with OO focusing on training and connecting top notch developers to work.
• There is a need for a country-specific strategy that could be developed based on each country’s experiences and context, as well as countries’ readiness from the perspective of talent, cost, infrastructure and enabling environment. Country-specific strategies should address niche employment based on the types and complexity of tasks, and then identify the main demographic sub-groups that are most suitable for such jobs. This should be combined with initiatives that not only raise awareness of OOs for workers, but also for potential clients in both the public and private sectors.
• Conducting a pilot project, in order to take a planned and phased approach to OO industry development. No country has ever developed a holistic industry development program. There are social factors that need to be examined from a practical perspective — such as youth and women’s willingness and ability to perform remote work, and their sustainability as long-term OO workers, as well as the need to expand OO opportunities to less-advantaged and lower -skilled population segments.
• A “high touch” skills development approach, in which potential workers are given extensive on-the-job training to help them transition to accessing and delivering on their first few jobs. Additionally they should have on-going mentorship for their initial months of work, so they may be guided towards maximizing their potential in higher valued-added services, and to convert their initial experiences into sustainable, rewarding and long term OO work.

The upcoming launch of the OO report and toolkit can contribute to Kenya’s and Nigeria’s OO strategy. Through follow up with key stakeholders and ecosystem players for OO and its target beneficiaries, we hope that these discussions will translate into tangible actions that can contribute to the World Bank’s twin goals of eradicating poverty and increasing shared prosperity.