According to the latest research by Statistics South Africa, youth unemployment in the country stands at a disappointing 52.4% for the first quarter of 2018. This number could however be minimised if the public and private sector join forces to build a supportive entrepreneurial ecosystem for the younger generation, which statistics indicate, are more open-minded to entrepreneurship as a career choice than generations before them.
In light of upcoming Youth Day on June 16, entrepreneurship needs to be better profiled as a career of choice for young South Africans.
Research reveals that 72% of Generation Z (individuals born between 1995 and 2012) aspire towards starting their own business. This is in comparison the 66% of the Millennial Generation (individuals born between 1980 and 1994) who aspire to be entrepreneurs. As Generation Z now begins to enter the workforce, it is imperative that the challenges facing young entrepreneurs are addressed in order to further promote this sentiment.
President Cyril Ramaphosa, during his inaugural state of the nation address, highlighted that South Africa’s economy will be sustained by small businesses. With this in mind, it is extremely positive that the younger generation has more entrepreneurial intentions. This sentiment needs to be cultivated by creating the best possible entrepreneurial ecosystem.
However, this is not to say that the public and private sector should shirk their responsibility for creating jobs themselves.
The government should remain committed to creating a conducive environment for business growth. In turn, the private sector should run their businesses optimally with the view to be more profitable and create jobs.
In order to stimulate entrepreneurial activity among the youth, it is vital to consider the traits of Generation Z to ensure they are best equipped to venture into the ever-evolving landscape and to foster a culture of entrepreneurship. It is important to note that Generation Z is the first generation to not know life without the internet and social media, which is a big contributing factor to the overall characteristics of this generation.
Dubbed digital natives, Generation Z is growing up with a plethora of information readily at their fingertips, and a wealth of instilled technological knowledge. The World Economic Forum notes that they are already at an advantage compared to their generational predecessors, in light of the prediction that there will be more than 1.5 million new digital jobs available globally by 2020.
The digital landscape in South Africa, however, proves to be a challenge for some. The World Wide Worx’ Internet Access in South Africa 2017 report has revealed that income disparity is causing a digital divide.
Even though the overall internet penetration was recorded at 40%, South Africans on high income levels had an internet penetration rate of over 82%, while internet penetration fell below 30% among the lowest income earners and therefore limits access.
Bearing this in mind, it is imperative to rectify this disparity, so that all South African’s have equal and affordable access to the internet in order to minimise challenges local Generation Z may face as they grow into the workforce.
Here are two arenas that are impacted by access to internet that would affect the aspiring entrepreneurs of the future:
South Africa’s education system has long been reported to be facing many challenges. Online learning can offer a viable solution to this problem as learners will be able to access courses and textbooks from any location ultimately minimising the issue of space in schools and universities.
Methods of doing business:
The digital world is increasingly becoming further entrenched in the business world. From digitally based companies like e-commerce sites or the use of social media as a tool to market a business, it is becoming an essential platform for companies to utilise. For example, it has been reported that Facebook alone is used by 550 million people globally to buy and sell items in local communities. It also provides an inexpensive and far-reaching way to market a business.
This is a great way for fledgling small businesses to minimise the costs of having a website as well as expensive marketing costs whilst still being able to garner similar results.
Therefore, it is crucial that the public and private sectors band together and invest in the country’s digital infrastructure to create an entrepreneurial ecosystem where Generation Z can thrive, create job opportunities, and contribute towards minimising the youth unemployment rate in South Africa.
David Morobe is regional general manager at Business Partners Limited www.businesspartners.co.za