ICT and Labor Market Outcomes in Rwanda: Evidence from 2000–2023 Time-Series Data

• Author(s): Mukasa Stanley ; Aliyu Umar
• Paper ID: 1708727
• Page: 1680-1692
• Published Date: 26-05-2025
• Published In: Iconic Research And Engineering Journals
• Publisher: IRE Journals
• e-ISSN: 2456-8880
• Volume/Issue: Volume 8 Issue 11 May-2025

Abstract

The promise that digital technologies will reduce unemployment and drive inclusive growth is widely accepted but often untested in the context of low-income, informally structured economies. This study examines whether the rapid spread of internet use, mobile connectivity, and broadband access has delivered employment gains in Rwanda, a country positioning itself as a regional digital hub. Using data from 2000 to 2023, we apply time-series econometric models including Vector Auto regression (VAR), Structural VAR (SVAR), Impulse Response Functions (IRFs), Granger causality, and Instrumental Variable (IV) regression to measure short- and long-term effects of ICT adoption on employment. Findings show that broadband expansion is initially associated with rising unemployment, reflecting disruption and skills mismatches in the labor market. Meanwhile, internet and mobile adoption exhibit bidirectional causality with unemployment, signaling simultaneous processes of job creation and displacement. The analysis finds no consistent short-term effect of ICT on GDP growth, reinforcing the view that infrastructure alone is insufficient to generate broad-based employment. The study contributes new evidence to the Digital Labor Ecosystem and Structural Digital Inequality frameworks, showing that ICT’s labor market effects depend on institutional readiness, digital skills, and regulation of informal digital work. The findings challenge assumptions that ICT adoption inherently reduces unemployment, and instead point to the need for targeted policy interventions particularly digital skills development, labor formalization, and gig economy regulation to align digital progress with inclusive labor market outcomes.

Keywords

Digital transformation, ICT adoption, unemployment, broadband penetration, mobile connectivity, internet access, digital labor ecosystem, structural digital inequality, time-series econometrics, Rwanda

Citations

IRE Journals:
Mukasa Stanley , Aliyu Umar "ICT and Labor Market Outcomes in Rwanda: Evidence from 2000–2023 Time-Series Data" Iconic Research And Engineering Journals Volume 8 Issue 11 2025 Page 1680-1692

IEEE:
Mukasa Stanley , Aliyu Umar "ICT and Labor Market Outcomes in Rwanda: Evidence from 2000–2023 Time-Series Data" Iconic Research And Engineering Journals, 8(11)