Unemployment remains perilously high across the Middle East and North Africa region (Mena), where 70 per cent of the 283 million youth aged between 18-25 are out of the job market.
In Egypt, the unemployment rate is currently pegged at 7.4 per cent, but this figure is only set to tick up as more businesses either shut down or downsize due to a high inflation, import restrictions and interest rate hikes.
According to a report by human capital solutions provider JobMaster, of 104 corporates surveyed, 5.8 per cent said that they have considered layoffs, while 51.2 per cent froze hiring, and only 3 per cent said they will continue hiring across critical roles.
At the same time, the country has been suffering from a major brain drain, as a result of workers, particularly those in the tech sector, migrating elsewhere in search of better opportunities. This has resulted in a severe talent shortage facing most industries in the inflation-stricken country, with employers struggling to hire good talent.
"We have at least 500,000 [students] graduating from universities in Egypt every year and there are mounting challenges in getting them hired and retaining them. On the other hand, 78 per cent of corporations are struggling to attract the right calibre at the right time," says Yahya Hossam, business development manager at Egypt-based career-tech startup Career180.
The Career180 platform is a spin-off of a larger initiative called "Egypt Career Summit," an annual offline event aimed at connecting job seekers with employers. In 2020, the online platform launched, with a focus to nurture career growth for professionals across different areas such as marketing, logistics, IT and soft skills.
In an attempt to diversify its business streams, the startup started to integrate recruitment services onto its platform, catering to employers as well as job seekers.
"From the get go, we were gunning after multiple areas of development. Our edge is that we cater to the complete lifecycle of career growth, professional development and recruitment. The solution we offer blends the lines between professional development and recruitment," Hossam explains.
After completing a course, the platform helps the jobseeker connect to potential employers or an internship opportunity, depending on various factors such as years of experience. Meanwhile, employers can find a suitable candidate according to qualifications and skills in need.
So far, the platform has onboarded 1500 employers and offers 200 recorded courses to 250,000 users.
Similar to other edtechs, the main challenge faced by the startup was consumer reluctance towards online learning and the low popularity of e-payments. Thanks to Covid-19 and the ensuing rise of the interest in online products as well as a jump in the financial inclusion rates, a lot of career-focused edtechs have come to being, with the aim to offer relatively affordable subscription fees in pursuit of rapid consumer acquisition and growth. This, in addition to corporates facilitating training programmes for their employees, has helped boost the awareness of e-learning solutions.
Amid the backdrop of a difficult economic landscape marred by layoffs and modest salaries, the rise in interest in solutions like Career180 comes as a result of people's need to acquire relevant skills to boost disposable income.
"In this economy, people have come to the realisation that the only way to generate decent income is to work. Therefore, they are now more willing than ever to invest money in education and professional development. As the market becomes more competitive, the bigger the need is for skilled calibres," he adds.
Career180 is currently in the process of closing a Seed round to develop its tech infrastructure as well as grow its presence in the Mena region, where the total addressable market is believed to be $16 billion.
"We are already expanding to the Saudi market, which we believe is the closest to us in terms of market dynamics. We offer the courses exclusively in Arabic and there's a demand for that too. Plus the target market in Egypt is worth $1 billion, meanwhile, in Saudi Arabia, it is $3 billion, so it is three times higher than Egypt," says Shrouk Alaa Eldin, co-founder of Career180.
While the high purchasing power was alluring for the startup to launch in the Saudi market, leveraging the first mover advantage is what motivated Career180 to consider expanding to Jordan.
“We recently held a Mena Career Summit targeting professionals in the Mena region; it was merely an attempt to get our pulse on which markets have high interest in our solutions. We were surprised that a high number of attendees were from Jordan. Taking a thorough look, the career-focused edtech market in Jordan is sparse. I think we are faced with little to no competition there,” adds Alaa Eldin.