The government must mobilize the private sector and all stakeholders to fight against youth unemployment
The unemployment rate continued to climb in 2021 to reach 32.6% in the first quarter – the highest rate on record. Officially, there are more than 11 million unemployed, among which young people are the hardest hit by economic stagnation with an unemployment rate of 63.20%.
This is a major problem that cannot be solved by government alone and requires a social pact involving communities, workers and the private sector.
The government has the responsibility to take the initiative, but it must mobilize all the social partners concerned.
At the heart of it all is the need to lobby for the reorientation of our education system to focus more on improving the performance of the system. For a long time our main goal has been to open doors to learning and improve literacy levels.
As a result, many young South Africans sit at home with qualifications, but lack the skills required by the economy.
Unfortunately, despite heavy initial investments in education and despite increasing enrollment, our educational programs have not undergone profound structural changes. Too many learners leave universities with degrees that do not match the needs of the job market and not enough with degrees in science, engineering or medicine.
This can be addressed by ensuring that the private sector is engaged and involved in improving the outcomes of our education system.
The private sector is the biggest beneficiary of our education system but gets involved very late when many students have obtained skills that are not in demand. If the private sector does not get involved, this dislocation of skills will persist.
The government has generously provided the private sector with unconditional tax breaks and employment subsidies such as the employment tax incentive and the youth employment program, and many have used this money to accelerate automation and mechanization and, in some situations, to replace older workers.
Communities also have a role to play in influencing education because contrary to popular belief there have always been indigenous forms of education which were underestimated and despised by policy makers who are heavily influenced by colonial attitudes. .
Therefore, education functioned independently of the realities of the African environment and political education. Our education system must be emancipatory, gender balanced and include African philosophies. There is a need to move away from the purely academic focus on education, to promote multiple pathways, based on individual talents and interests.
Our education system has pockets of excellence, but these need to be broadened and comprehensive. We still have a lot of young people, especially from historically disadvantaged communities, who fall through the cracks. No modern economy can thrive if some of its young people lack reading and math skills.
The 4th industrial revolution is here, and our education system must be responsive and equip young people with the necessary skills to be competitive.
Without urgent and focused action today to manage the short-term transition and build a workforce with sustainable skills, we will likely continue to face ever-growing unemployment and inequality.
But we must also ensure that technological solutions in themselves are not imposed without taking into account local economies and cultures, as this approach brings misery to those who are pushed aside by such developments.
Skills creation alone will not solve unemployment, we need a lot of young people to become job creators and get involved in entrepreneurship. Programs or interventions aimed at improving the skills of the workforce may be effective in urban or intermediate regions, but have little impact in rural areas where participation rates are low.
This is where entrepreneurship can step in to solve unemployment problems. This can take the form of individual businesses or cooperatives.
One of the main challenges facing small businesses is the lack of funding. Young people are rarely targeted by subsidized credit and they are not well served by formal sector financial institutions. By thus becoming profit-seeking, microcredit institutions also contributed to the marginalization of young people, as they resorted to high interest rates and demanding collateral for informal financing.
The government should set up the National Youth Development Agency and ensure that its funds go to young people looking to start their own businesses. Banks must commit to providing affordable and accessible credit to young people who want to start their own businesses. There is also a need to develop a state bank and non-profit financial institutions that can reduce the cost of credit for young people.
Some government programs such as the Presidential Employment Program and internship programs, which have been successful in relieving some unemployed youth, need to be expanded to provide young people with a living wage and be insured across all walks of life.
The government must show the way. It must obligatorily require all public companies and agencies at national, provincial and local levels to submit internship plans; each must have a quota per year, at the level of the minimum wage. The same can be done by labor and the private sector.
Current expanded public and community works programs must be based on the craft programs which provided valuable training. The intention should be to equip young people with skills, and also to help them to venture out and start their own operations with the skills they have acquired, and not just to use these programs as a source of labor. inexpensive work for bankrupt municipalities.
The public procurement system needs to be overhauled so that there is a single open, online system for the whole state. This will facilitate monitoring and ensure that it promotes local sourcing and prioritizes young entrepreneurs. The 15 sectoral master plans of the Ministry of Trade, Industry and Competition must be strengthened to move these sectors of the economy and force them to give priority to youth employment.
Some interventions to deal with demotivated young people include granting unemployed young people Jobseeker’s Allowances to cover their transport costs and other costs involved in the application and selection process. Application portals should be exempt from data charges to allow free access to applicants.
Given that young people are the most affected by unemployment despite representing the majority of the population, it is a travesty that they continue to be under-represented in decision-making. Increasing youth participation in all spheres of government should not only be discussed but implemented by governments, political parties and civil society organizations.
* Sizwe Pamla is the national spokesperson for Cosatu.
** The views expressed here are not necessarily those of the IOL and the independent media.