Innovation capacity and youth employment in Sub-Saharan Africa: Does educational quality matter?

In this study, the effect of innovation on youth employment in Sub-Saharan Africa (SSA) is examined, along with the role of education as an intermediary effect. In particular, the extent to which educational quality conditions the relationship between innovation capacity and youth employment in the region is evaluated. The study uses annual panel data for 27 SSA countries covering 2010 to 2023. Educational quality is captured using secondary school enrollment, pupil–teacher ratio, school life expectancy, and years of compulsory schooling. At the same time, innovation is considered in relation to industry and government-led initiatives. The generalized least squares method with country fixed effects is used in the empirical analysis. The results from the direct models show that innovation capacity and firm-level R&D spending are associated with lower youth employment, although government adoption of technology and the quality of scientific research institutions show positive youth employment effects. More importantly, the interaction results reveal that innovation becomes more beneficial for youth employment where educational access and quality are stronger. Specifically, lower pupil–teacher ratios, higher secondary enrollment, and longer compulsory schooling strengthen the positive youth employment effect of innovation. The study, therefore, demonstrates that educational quality is a critical transmission mechanism by which innovation can translate into youth employment gains in SSA. In practical terms, innovation policy in SSA need not be pursued in isolation from education reform. Governments have to strengthen science, mathematics, digital, and technical education over time to support inclusive youth employment in the region.