Kampala, Uganda—April 1, 2025 – In an economy marked by sharp urban-rural divides, Uganda’s push toward digital transformation is revealing both immense potential and entrenched disparities. A recent study by the Economic Policy Research Centre (EPRC) titled Creating Decent and Productive Jobs Through Digital Transformation in Uganda sheds light on how digitalization is impacting the country’s labour market—particularly within high and medium-digitalized sectors—and what it means for inclusive job creation.
Uganda’s digital economy is unevenly distributed across sectors. The study’s digital scoring model, which quantifies the degree of digital integration within sectors, shows that industries such as information and communication technology (ICT), real estate, professional services, education, and finance are leading the digital charge. At the top of the scale, ICT scored 60.8 percent, followed closely by real estate at 61.1 percent, professional, scientific, and technical services at 55.9 percent, education at 51.6 percent, and financial and insurance services at 51.3 percent. These sectors are concentrated in urban areas and are typically staffed by more educated, digitally literate workers.
The ICT sector, with its 60.8 percent digital score, remains the backbone of Uganda’s digital job market. Roles such as software developers, telecom engineers, IT support specialists, and data technicians dominate the space. Supported by initiatives like the National ICT Initiatives Support Program (NIISP) and innovation hubs such as The Innovation Village, this sector benefits from government and private sector investment. However, access to these opportunities is geographically limited, with a strong bias towards Kampala and other major towns where internet infrastructure and educational institutions are concentrated.
Real estate, although small in terms of labour force participation—employing just 0.22 percent of the workforce—surprisingly scored the highest at 61.1 percent. This high score is attributed to the sector’s adoption of digital platforms for property listings, virtual tours, mobile payments, and online customer service tools. Yet, the benefits remain largely within high-income urban areas, and the sector’s limited employment capacity curbs its wider socio-economic impact.
Professional, scientific, and technical services also demonstrate significant digital potential. Surveyors, cartographers, accountants, and consultants make up a growing group of digitally integrated professions. Cartographers and surveyors, in particular, are among the fastest-growing digital occupations according to the report. These roles require specialised software, remote sensing tools, and advanced data analysis skills. However, as with ICT, access to training and tools is primarily confined to urban populations.
Education, a sector undergoing rapid transformation, reflects a digital score of 51.6%. This shift is being driven by the government’s Education Digital Agenda Strategy (2021–2025), which seeks to integrate ICT into teaching and learning processes. E-learning platforms, digital assessment tools, and virtual classrooms have become more widespread—especially in urban schools. But the rural digital divide remains stark. In many rural schools, access to computers, internet, and skilled ICT instructors is severely limited, leaving millions of students behind.
Financial and insurance services round out the high-digitalisation group with a score of 51.3%. The proliferation of mobile money, fintech applications, and digital banking has transformed how Ugandans transact. Mobile money usage increased from 58% in 2018 to 64% in 2023. However, only 31% of adults have access to digital credit services. Financial inclusion remains urban-centric, as rural residents face barriers such as poor mobile network coverage and lower financial literacy.
Occupations in broadcasting and audio-visual media, though not defined as a distinct sector in the report, are also highlighted for their growing digital integration. Audio-visual technicians, video editors, radio presenters, and announcers rely on ICT tools and content creation platforms. Between 2016 and 2021, over 7,000 digital jobs were created in this space, pointing to media and entertainment as a potential growth frontier.
While these high and medium-digitalized sectors offer higher wages, better working conditions, and greater job security, they employ a relatively small portion of the total workforce. The study’s regression analysis shows that a 1 percent rise in a job’s digital score is associated with a 5% increase in monthly earnings, a 6% higher likelihood of accessing social security, and a 9 percent increase in formal employment contracts. Overall, such roles have an 11 percent greater chance of offering decent employment. These statistics underscore the clear link between digitalization and job quality, confirming that digital skills act as a gateway to better livelihoods.
However, the study also reveals structural and systemic barriers that prevent broader participation in the digital economy. Infrastructure limitations, particularly in rural areas, are a major obstacle. Only 2 percent of Ugandan households own a laptop or desktop computer, with rural ownership at a meagre 0.9 percent. Poor electricity access, weak internet coverage, and high data costs further constrain digital uptake. For instance, the high price of smartphones and mobile bundles remains a significant deterrent for youth and low-income earners.
Digital literacy is another formidable barrier. Uganda’s national digital literacy rate stands at just 20 percent, and the skills gap is further widened by gender disparities, with women facing cultural and financial limitations in accessing digital tools and training. Policy implementation is also a recurring issue. While the country has a comprehensive set of policies—the Digital Uganda Vision, the Education Digital Agenda, and the Fourth Industrial Revolution Strategy—budget allocation and enforcement remain weak. In FY 2022/23, only 0.36 percent of the national budget was allocated to the Ministry of ICT, severely undermining efforts to scale digital initiatives.
Although the study forecasts the creation of 942,000 net digital jobs between 2016 and 2021, 91 percent of these are in medium-digitalized, informal roles such as street food vendors, fishery workers, carpenters, and shopkeepers. While these roles increase employment numbers, they often lack decent work standards. For example, the average monthly income for street vendors is Shs 31,000—far below the national median wage of UGX 200,000—and few of these workers are covered by social security.
To close the gap between high-potential digital sectors and the broader workforce, the EPRC study makes several policy recommendations. Uganda must prioritize investment in digital infrastructure, particularly in underserved regions. Deploying broadband internet and ensuring reliable electricity in rural areas is essential. Additionally, the government should expand digital literacy programs, especially targeting women, youth, and informal workers. Labour laws must also be updated to reflect new forms of work in the gig and platform economy, ensuring protections such as social security and minimum standards for non-traditional digital workers.
Furthermore, embedding digital skills in school curricula and fostering public-private partnerships to support apprenticeships, certifications, and tech-driven startups would boost human capital. Uganda’s path toward a more digitally inclusive economy depends not only on expanding access but on ensuring the equitable distribution of opportunities and benefits.
As the country continues to navigate the challenges of the fourth industrial revolution, the success of digital transformation will hinge on policy coherence, sustained investment, and a commitment to closing the rural-urban divide. High and medium-digitalised sectors already show what’s possible. The challenge now is to bring the rest of the country along.
