Reduced Youth Unemployment in South Africa Is Possible Through Pragmatic Policies

By: Bongiwe Khumalo,

Youth unemployment is a severe problem for socioeconomic development on a worldwide scale. It threatens national development because it affects more individuals than just the unemployed. Economic overreliance on natural resources has had a detrimental effect on socioeconomic development as a whole. Africa faces significant challenges when it comes to youth employment. According to Statistics South Africa, 2021, there were 7.2 million unemployed people in South Africa in the fourth quarter of 2020. In South Africa, youth unemployment is a serious problem that calls for practical and focused policies. The International Labour Organization (ILO) estimates that the world Gross Domestic Product (GDP) would increase by $2.2 trillion with a semi-reduction of youth unemployment. Due to the problem of youth unemployment, the majority of South

Identifying and implementing initiatives, i.e., a combination of targeted interventions and pragmatic policy measures that address the underlying causes and obstacles impeding young employment prospects, are essential if this problem is to be effectively addressed. The lack of suitable data on crucial factors like entry into, exit from, and duration of unemployment is also a challenge for establishing effective policies. The following points are proposed pragmatic policy possibilities that may help lessen South Africa’s youth unemployment rate and generate sustainable employment opportunities.

• Promoting the Growth of SMEs and Entrepreneurship

Encouraging young people to start their own businesses can create jobs and accelerate economic growth. Policymakers should prioritize supporting small- and medium-sized enterprises (SMEs) and new businesses. This can be achieved by implementing measures such as optimizing the business registration process, granting loans at affordable interest rates, offering business development services, and creating mentorship initiatives. Through promoting an entrepreneurial culture and supporting the expansion of SMEs, South Africa can open up new opportunities for economic growth and employment creation. The government’s inability to fully actualize youth empowerment by allowing them to launch their businesses may be due to its insufficient financial resources for such programs.

• Enhancing Vocational and Industrial Technical Education

This necessitates a concerted effort to acquire soft and technical skills, as technical and vocational training programs for young people without jobs frequently do not substantially match employer skill requirements. Funding for technical and vocational education is crucial to bridging the skills gap between the expectations of the labor market and the young unemployed. Priority should be given to legislative measures that strengthen vocational training facilities, modernize curricula to match industry requirements, and foster strong partnerships between school systems and employers. Emerging talents should be included in school curricula. If young people acquire the requisite skills, they will be more employable and prepared for the workforce, reducing unemployment rates. Furthermore, the government must promote collaborations with companies in partnership with other social partners, namely, the private sector, labor, and civil society.

• Promoting public-private partnerships

Effective collaboration between the public and private sectors is necessary to address youth unemployment. Governments should cooperate closely with the business community to determine whether industries have a labor shortage and develop appropriate solutions. Public-private collaborations may include programs such as paid training roles, compensated apprenticeships, and free internships. By matching the expectations of employers with the skills development programs of the public sector, young people can increase their chances and gain valuable work experience.

• Encouraging the inflow of foreign direct investment.

When expertise, money, and technology are transferred from foreign direct investment (FDI), young South Africans will have more job opportunities, as these investments often play a significant role in economic growth and job creation. Policymakers must create an environment that is conducive to foreign organizations investing. This can be assisted by lowering bureaucratic red tape, improving infrastructure, and providing financial incentives. Efforts should also be made to ensure that the local population has the skills necessary to take advantage of the job possibilities created by FDI.

Simplifying regulations for the labor market

Rigid labor market laws prevent young people without experience from finding employment, even though they may be qualified for particular positions. Simplifying labor market laws should be the main focus of policy adjustments to provide firms, particularly SMEs, greater flexibility in hiring staff members according to their needs. This can be accomplished by creating incentives for businesses to hire and keep young people, as well as by modifying minimum wage rules to consider young workers’ skills and productivity. By reducing regulations and offering tax benefits to businesses that invest in youth training and development programs, South Africa may foster an environment more conducive to job creation and young employment.

The government should prioritize funding for skill training and education programs tailored to the labor market’s needs. This will give youth the skills and knowledge necessary to compete in the job market. Secondly, creating a corporate environment that encourages entrepreneurship and innovation can also help expand the pool of employment opportunities available to young people. If you provide young people with access to funding, mentoring, and business development support, they can start and grow their own businesses and employ others. Additionally, to successfully lower youth unemployment in South Africa, governments, educational institutions, businesses, and other stakeholders must work together to develop comprehensive strategies and workable policy initiatives that increase the chances of young people gaining employment and creating businesses for themselves.

Ms. Bongiwe Khumalo is an educator and researcher. She writes in her personal capacity.