Self‐employment preferences among university graduates in Ghana: Does gender make a difference?

Motivation Youth employment has become an urgent policy issue in Africa. Half of the population is under 25 years old on a continent in which job creation lags behind economic growth. Consequently, policy‐makers have increasingly proposed self‐employment as a solution to the challenge of youth unemployment. Purpose This study examines self‐employment preferences among university graduates in Ghana. We address two related questions: (1) Are there gender differences in young people’s willingness to pursue self‐employment; and (2) what are the predictors of preference for self‐employment in male and female graduates? Methods and approach Our analysis draws on a sample of 1,180 university graduates interviewed during their compulsory year of national service, which follows graduation. We analyse gender and other sub‐group differences using t‐tests for statistical significance of differences in means. We then estimate multinomial logit regressions to analyse what factors predict employment preferences. Findings We find substantial gender differences in preferences for self‐employment. Despite women having higher rates of self‐employment in the economy, the female graduates in our sample are significantly less likely to prefer self‐employment than men—12% of women and 16% of men report that their desired type of work would be self‐employment. Moreover, while marital status and childbearing are the strongest predictors of self‐employment preferences for women, self‐employment experience and financial background are the strongest predictors for men. Policy implications This study suggests that gender differences in labour market outcomes are partly a function of differential preferences rooted in unequal constraints. Bridging these gendered inequalities will require policy interventions that both impact the preferences women form prior to entering the labour market and address their gender‐specific concerns about family responsibilities.