The World Bank says unemployment increased by 34 million people in the wake of the global financial crisis. But is the key to job creation on rural farms or in tech companies in the cities? A panel at World Bank in Washington discussed this issue.
Economist Byron Auguste, who heads the social sector office of the consulting firm McKinsey and Company, readily acknowledges what every economist and policy maker knows -- there is no one simple way to jumpstart job creation. And while many people say technology will provide the jobs of the future, Auguste said he thinks developing nations should focus on their agriculture and service industries if they want to see job growth.
"In the developing world, there's a massive opportunity to increase agricultural productivity, wages and employment by moving to higher value crops and expanding cultivation with the right supports and financing for small-holder farmers," he said.
In addition, Auguste says, the service industry accounts for 85 percent of job creation in middle income countries and as much as 68 percent even in low income countries.
But talk on the panel kept coming back to two words that conjur up images of innovation and job creation: Silicon Valley. It is the part of U.S. state of California that is home to many of the world's leading high-tech companies, such as Apple and Google.
Serbia's Minister of Science and Technology Bozidar Delic summed up Silicon Valley's appeal in one word -- meritocracy. "Why is Silicon Valley, Silicon Valley? Because when you come, it does not matter who you are. It's what you know," Delic said.
The panelists also agreed that it is important to know a country's strengths, as well as to identify potential areas for economic growth. As one panelist noted, you can teach a person to ride a bicycle well, but that is not much help when he or she is up against a sports car.
Serbian Minister Delic illustrated that point. He says hybrid and electric cars are likely the future, but Serbia's auto industry, while solid, is not competitive enough to get an edge in the hybrid car market. Instead, he said, Serbians are working to get an edge on a piece of that market, and scientists in the country are working on developing better lithium batteries, which are a key element of hybrid cars.