Abstract
The study examined the impact of Information and Communication Technology (ICT) on employment in sub-Saharan Africa, focusing on the two largest regional blocs: theSouthern African Development Community (SADC) and the Economic Community of West African States (ECOWAS). The study investigated how structural factors – human capital, foreign direct investment inflows, and trade openness – moderate this relationship using the dynamic panel threshold regression model. The study also examined whether the impact of ICT on employment is homogeneous or heterogeneous, depending on the distribution of employment, applying the dynamic quantile panel regression model with fixed effect covering periods from 2000 to 2023. The study was based on three theories that collectively imply that the impact of ICT on employment is non-linear and heterogeneous. The results from the threshold analysis reveal that in the SADC region, internet and mobile technologies boost employment at low levels of human capital. In ECOWAS, ICT promotes employment once modest thresholds of human capital are reached, though fixed-line infrastructure remains less effective. ICT-driven employment gains in SADC require higher trade openness, while in ECOWAS, benefits emerge even at moderate openness levels.
The results from the dynamic quantile panel regression for both SADC and ECOWAS highlight the heterogeneous nature of ICT’s employment effects across the distribution of employment. In SADC, internet penetration emerges as the most consistent ICT driver of job creation across all quantiles, while the impact of fixed telephone subscriptions is mixed, varying by employment level. In contrast, in ECOWAS, both internet penetration and fixed telephone subscriptions exert broadly positive and significant effects across the distribution.