Transforming Youth Economic Empowerment

2015-07-19 07:02

In the recent history of our great nation, there has not been a greater threat to transformation and economic development like Youth unemployment. The trade unions call it the ticking bomb, while the Governor of the South African Reserve Bank calls it a crisis. It is as shocking as it is as threatening; more than 50% of South African youth are unemployed. Only 5% of historically disadvantaged youth that make it to the University will graduate. The greatest threat being a generation of South Africans doomed to dependency on the social grant system and an exaggerated burden on the fiscal policy.

Problems do not eliminate themselves and as a nation we need to brave up to the journey and tackle the problem head on. It is a frontier worth exploring and a journey necessary to be embark on.

Youth Employment Mainstreaming

The primary approach to tackling the challenge has been the need to create an environment where it is commercially appealing to employ the youth. Basically make it part of labour market culture to employ young people. Such mainstreaming activities may take several shapes and forms but in recent years the DA has led the way with a concept they call, "the Youth Wage subsidy" The tenant of their proposal is to create an incentive for business to employ young people by covering a portion of their wages. As far as mainstreaming ideas goes, this is both bold and radical. It is a long way away from other interventions which include market education and appealing to a sense of morality by employers to care enough to do something about the problem.

There is however an opposing view that focuses exclusively on labour market trends and the historic nature of employee and employers relations. That history has taught them that, the classic economic view that if parties maximise their economic goals, wealth is invisibly distributed amongst the player is wrong.

Employers have a history of exploitation and the existence of a subsidised work force will result in profiteering. Why would the jobs of adult employee's be safe when the youth can make cheaper employees. Our history with economic migrants supports such theories with cheaper labour marginalizing South Africans in other sectors.

What is missing in the whole picture and perhaps unfortunate is the idea that there is no political solution to the problem. I am a believer in the South African dream, till this day there is no grander moment for me than the TV ad where South African outliers declare that this country is alive with possibility. So it is as unthinkable as it is shocking that as a country we do not have a Social contract amongst all role players on how to solve such challenges.

Social Contract

Our National Skills Development Strategy (NSDS) identifies Further Education and Training (FET) institutions as the purveyor of skills to the unskilled youth of South Africa. The assessment programme within these institutions requires experiential or vocational exposure for a period. Effectively if the FET programme starts producing at rapid scale, placement should match up. This is far from the truth in our reality as a nation.

The labour market is not oriented to fulfil such a role. As an idealist I wonder why if sector skills needs in the NSDS says these FET training is needed, where are the employers to close the link. Thus in mainstreaming youth employment the premise would be to seal it in a social contract between labour, government and business. Our post 2009 recession reality has taught us that government interventions that stimulate economic growth like the American Quantitative easing require clear deadlines and market buy in. Youth wage subsidies would not be undoing an indifferent past like affirmative action, and thus should not be implemented without time lines and a social gain programme. The existence of cheaper labour should not create an economic rent and business ambition to create new wealth and growth is subdued. The definition of social gain in this regard should be left to parties in the contract.

Youth Entrepreneurship

Entrepreneurship is being promoted in South Africa as a possible source of job creation, empowerment and economic dynamism. There has been a migration in policy and the voice of opposition parties increasing attention on the subject. However, despite this attention, there has been no systematic attempt to look at it from an angle of a South African young person with his inherent challenges.

We tend to incorporate the youth into the general adult population when it comes to some of the policy decision that drive business development and we ignore their efforts to forge a livelihood through enterprise activities. We have stopped very short of understanding the potential benefits of youth entrepreneurship as a means of improving youth livelihoods. Can youth entrepreneurship be promoted as a viable career option? What obstacles stand in its way? And what policy measures and strategies can be initiated to support it?

Be Inspired!

Ps. To my brothers David Khoza and Sipho Malatji knowing you and being touched by your lives has made me a better human being. You will be missed!

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