Entrepreneurship and Poverty Reduction: The Case of the Youth in Small-Scale Mining in Ghana

Rural livelihoods have been increasingly moving away from agrarian to non-agrarian. For mineral rich countries, attention has been on mineral extraction which has offered numerous entrepreneurial opportunities. The small-scale mining sector, compared to the large-scale sector, is particularly important as it offers several more opportunities for employment of the youth. The youth, who are affected by contracting public sector, turn to small-scale mining which is labour intensive. The purpose of this study was to analyse the resources that the youth in small scale mining rely on in their entrepreneurial activities and whether these activities translate into poverty reduction. The study used sample survey and interviews in Kui and Kenyasi No. 2 in Northern and Brong Ahafo Regions respectively to collect information on the various entrepreneurial activities engaged in by the youth and the resources they rely on to carry out those activities as well as the challenges and institutions within which they operate. The results reveal that the youth were not homogenous in terms of their motivations and the entrepreneurial activities they engaged in. Both contextual and personal characteristics of the youth accounted for the differences. For instance, the youth who went into small-scale mining to take advantage of a business opportunity were more likely to be in the service economy or dealers in gold. Similarly, dealers, membership of informal savings and credit schemes, were significantly associated with poverty reduction. Despite the sector‘s contribution to poverty reduction, it is faced with several challenges which affect personal health and safety. The study recommends that formalisation process of small-scale mining be made easier to enable the youth access formal financial and technical support.