Political developments in Ethiopia during the transition of prime ministers temporarily gave rise to an uneasy sense of optimism. Following Prime Minister Hailemariam Desalegn’s stepping down from his role due to increasingly heavy national-level popular protests and a loss in unity of the ruling Ethiopian People’s Revolutionary Democratic Front’s (EPRDF), Abiy Ahmed’s ascension to the position represented a major departure from the EPRDF’s modus operandi.[1] Not only did his appointment mark a major powershift from minority Tigrayan to the larger Oromo ethnic group (and a marked change in the position of the Amhara), the new administration’s rhetoric of political liberalisation, democratisation and rights provided a major source of optimism in a state that traditionally relied on a decidedly illiberal and repressive governance system.[2] While this authoritarian system and the legacy it carries provide significant barriers to any transition to an alternative model, Abiy Ahmed initially delivered on a range of high-profile reforms. In his first months in government, among other measures, a gender-balanced cabinet was appointed, media censorship was curtailed, scores of political prisoners were released while political opposition figures were allowed to return from exile, and the long stalemate with Eritrea was formally ended.[3] The new prime minister became the first Ethiopian to receive the Nobel Peace Prize, launched a book outlining his medemer philosophy of national unity overcoming ethnic divisions and subsequently disbanded the EPRDF to replace it with the new Prosperity Party (PP).

Although the new administration has continued to drive major reforms through the EPRDF system since its initial months in office, subsequent measures have highlighted continuing ethnic divides. An accountability drive within the secret services and anti-corruption measures taken against the Metals and Engineering Corporation (METEC) set the stage for a power struggle between Addis Ababa and Mekelle, as these measures ensured that numerous Tigray People’s Liberation Front (TPLF) actors faced legal action and took shelter from prosecution within the Tigrayan ethnic regional state, while many officials of other ethnicities remained out of scope of the investigations.[4] While the relatively free and fair Sidama referendum of November 2019 may have provided hope for wider liberalisation measures in the face of vested ethnic interests, it led to 11 other zones of the Southern Nations Nationalities and Peoples Region (SNNPR) filing similar claims to regional statehood.[5] The initiative thus also highlighted the rising salience, fragmentation and politicisation of the multitude of ethnic identities in Ethiopia and its ethnic federal regional states. Regardless of the rhetoric and reforms promising greater liberalisation, the livelihoods of most Ethiopian citizens remain under significant pressure as inflation and unemployment continue to mount.[6] The ‘Abiy Mania’ that characterised the PM’s initial period in office has thus seen a significant decline.

In this context, ethnic actors increasingly mobilise sizeable constituencies demanding a greater share of power and economic spoils. This has raised tensions within the Oromo-Amhara coalition that brought Abiy to power.[7] The past few years have seen the re-emergence of ethnic nationalist conflicts across Ethiopia. Tensions have so far resulted in repeated coup attempts at both national and regional levels, the highly contested reorganisation of the EPRDF in the PP, ethnic protests that have led to hundreds of casualties among protestors (at the hands of state and regional security forces, as well as protestors from other ethnic groups) and increasing inter-ethnic violence and killings.[8] The growing pressure on the state to uphold a measure of rule of law has led to the reintroduction of a number of repressive instruments among the security forces and in the media, reminiscent of measures that had only recently been abolished.[9] By late 2020, federal military forces, ethnic militias and police forces were engaged in a range of ethnically framed conflicts across the country against a backdrop featuring a marked increase in instances of ethnic profiling.[10]

1.1 Research objective

Regardless of substantial shifts in the competitive landscape within the EPRDF/PP, the liberalisation and anti-corruption drives and the increasing ethnicization of popular political attitudes, the key legitimating factor of the regime has remained largely unchanged. Historically defining poverty as the biggest threat to the regime’s survival, the EPRDF relied heavily on output legitimacy based on a top-down developmental state model driving continuous economic growth and thereby justifying its continued existence, while at the same time lacking a solid popular mandate and implementing significant repression of dissent.[12] Although Ethiopia’s state-led Growth and Transformation Plan has given way to the more entrepreneurial Homegrown Economic Reform Plan, the underlying approach of tackling instability through increasing employment remains a core legitimating factor.[13] In a similar vein, a substantial part of donor policy in Ethiopia operates under the same assumption that (un)employment is a key driver of the instability affecting the country and that expanding employment could substantially reduce tensions. While (un)employment is undoubtedly a major component of political contestation throughout the country and should be a prime concern for government and donors alike, it should be kept in mind that substantial strands of research have highlighted the more complex nature of that relationship (especially in contexts with high informal employment and/or fragility).[14] For instance, trade unions have highlighted the importance of decent work rather than overall employment, research on illicit economies in the United States underlines how informal employment can lead to increasing marginalisation and aggravate grievances, while ethnographic work has shown how economic development in Ethiopia might translate into marginalisation of its young people.[15]

This report seeks to examine the relationship between urban informal (self-)employment and stability in Ethiopia.[16] It hence poses the question to what extent employment in the urban informal sector allows for the expression and reduction of (existing) grievances.[17] The report commences by outlining the wider socio-economic trends driving grievances among newly urbanised youth. This chapter considers the country’s sustained high economic growth in the face of persistent poverty, rapid population growth, demographic changes and increasing urbanisation, as well as patterns of inequality and marginalisation faced by those (self)-employed in the informal economy. The following chapter discusses the rapidly changing political context in Ethiopia, covering changes in governance as well as the re-emergence of ethnic nationalist forces. It focuses on changing patterns of EPRDF/PP political mobilisation, the weakening of party cohesion and the political mobilisation tactics of opposition parties. The fourth chapter covers the importance of ethnic identities and networks in employment. It commences by considering the long-standing ethnicization of the formal sector, and subsequently explores the rising importance of ethnic identity in informal employment and urbanisation patterns. The last chapter of this report summarises findings relating to grievance expression and their deepening or reduction through informal employment, and makes recommendations for more effective programming aimed at reducing ethnic tensions among those employed informally in urban spaces.

This report seeks to inform the debate on the impact of informal employment and stability in Ethiopia based on desk research and fieldwork in Addis Ababa. It should be remembered, however, that Ethiopia is highly diverse ethnically and that conditions across the country vary significantly.[18] Additionally, urbanisation and ethnic political contestation are rapidly changing the situation in many of these locations. As a consequence, dynamics described in this report cannot be expected to hold across Ethiopia, and extrapolations of such dynamics that do not take into account the local context may obscure important differences. Additional limitations are placed upon this research, as an in-depth examination of the ethnicization of Ethiopian politics is beyond the scope of this report. Additionally, the instability caused by these dynamics affected the conduct of the research. Even in the context of substantial political liberalisation, several respondents were hesitant or unwilling to fully express their views, while in other cases fieldwork sites outside of Addis Ababa were inaccessible due to ongoing violent ethnic clashes.[19] While data collection for this report attempted to account for such issues, no reporting on such a sensitive contested issue can claim to be exhaustive. Lastly, this report was developed before the Covid-19 outbreak that hit Ethiopia in March 2020 and the subsequent military operations in the Tigray regional state. These developments have significantly affected political contestation and the reform process, and are also likely to have had an effect on a number of the dynamics described in this report.