THE BLOG

Urgent Solutions Are Required To Make The South African Youth Employable

Governments need to offer the private sector incentive schemes that encourage recruiting young graduates.

03/10/2017 03:59 SAST | Updated 03/10/2017 03:59 SAST
fstop123/ Getty Images

South Africa's Education Ranking

It is evident that poor educational standards in South Africa are not only jeopardising the future of the country's youth, but also pulling the brakes on economic growth in Africa's second-largest economy, contributing to a 27 percent jobless rate and a frightening 55.90 percent youth unemployment rate in the second quarter of 2017.

While there are thousands of young people graduating from universities and higher education institutions every year, the private sector faces the challenge of finding people with the right skills and competencies to stimulate their growth.

There is patently a mismatch between what the South African basic and tertiary education sectors are providing and the changing needs and requirements of the private sector, with South Africa's primary education system rated 126th out of 138 countries in the World Economic Forum's 2016-17 Global Competitiveness Report, and its higher education and training system ranking 134th.

The South African educational system's ability to meet the needs of a competitive economy ranked close to the bottom of the barrel in the IMD World Competitiveness report ranking 60 out of 63.

Why Does This Problem Persist?

There are a number of reasons for this mismatch between graduates and the requirements of the industry. Graduates are misinformed about what skills are most needed by the job market and, as a result, they have educational profiles that are inconsistent with business requirements.

Many tertiary education institutions in South Africa are producing a generation of young graduates without the adequate training and skills to contribute productively to the economy. In addition, there is no planning between the private sector and public institutions on the one side and higher education institutions on the other side.

Often there is very little communication about industry's technological development and new models of production, which have rapidly changed the profile of talents required by the private sector.

Businesses and the education sector need to identify the jobs that present quick employment opportunities and at the same time contribute to the growth of the business. Businesses need to specify the skills needed to tertiary institutions and to develop the suitable training programmes to prepare young people to assume these jobs.

Matching youth skills and private and public sector needs require immediate intervention if we want to avert a major youth unemployment crisis and skills shortage in the near future.

Governments need to offer the private sector incentive schemes that encourage recruiting young graduates. An example is the South African government's ETI tax incentive that was introduced to encourage employers to hire young unskilled labour. Started in 2014 after several attempts by Cosatu to block it, the ETI supported around 15 percent of all jobs in the entire youth cohort of 18-to-29-year-olds.

Governments can also use regulation to promote youth employment. In 2016, Kenya, for example, enacted a law to implement the government's policy of allocating 30 percent of all government tenders to youth, women and people with disabilities.

Options For South Africa

Matching youth skills and private and public sector needs require immediate intervention if we want to avert a major youth unemployment crisis and skills shortage in the near future. There is a range of continent-wide initiatives that have started to address the education/skills mismatch in Africa.

Jobs for Youth in Africa involve collaboration between the African Development Bank and key partners in the public and private sectors across Africa to address the continent's youth employment challenge. It aims to create 25 million jobs and impact 50 million youth over the next decade. High-priority sectors will be tailored to country contexts, implemented in partnership with the private sector, evaluated, refined, and scaled.

This will include creating new rural micro-enterprises, equipping skilled youth to launch large-scale agribusinesses, and providing human capital for agro-industrialization, strengthening digital literacy and computational thinking in secondary schools, and developing coding academies that teach skills ranging from basic digital design to advanced coding languages.

To address the need for a broader skill set based on collaboration, creativity, innovation and flexibility, UCT this year launched the Hasso Plattner Institute of Design Thinking to train students to collaboratively and creatively address real-world problems.

Hundreds of UCT postgraduate students from all disciplines and from across the African continent have had the opportunity to help solve challenges posed by businesses like Old Mutual, Standard Bank and Pick and Pay, preparing students to work in diverse teams and to understand what end-user needs in business, local government and NGO's are, before posing solutions.

What is ultimately required is for a new paradigm to be adopted by the government, the private sector and education institutions to overcome Africa's challenge of youth employment.

It is imperative for government, business and universities to act now to avert the impending crisis of mass youth unemployment.

There Are A Number Of Options:

a) The government-led planning model:

Government agencies could be established to work with major economic sectors to identify the future skills the economy will need. The agency, such as Singapore's Ministry of Manpower, would oversee the development of a detailed human capital plan with specific requirements, down to the number of students in each discipline at universities.

b) The industry-government coordination model

This model requires government oversight of a group with representation from the economic and education ministries and specific industry associations. In Ireland, the Expert Group on Future Skills Needs [EGFSN] identifies crucial sectors, establishes plans to meet their future needs and provides guidance to industry, the educational system and the government.

c) The laissez-faire model

The laissez-faire model exemplified by the US and other large, mature economies in which government, business and educational institutions collaborate ad hoc in a less structured manner relies on enabling institutions, such as think tanks and industry associations, to facilitate coordination between business and academia. They do so in an environment enriched by openly accessible and reliable available data.

These global precedents are available for South Africa and Africa to learn from. Whether these ideas are adapted to suit local conditions or totally different new ideas are embraced, it is imperative for government, business and universities to act now to avert the impending crisis of mass youth unemployment.