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Among some difficult realities President Ramaphosa had to acknowledge during this year’s SONA (State Of the Nation Address), one of the hugely positive commitments he made was to implement programs to remedy South Africa’s national job crisis. With the current unemployment rate sitting at 29.1% – the highest it’s been since 2008, President Ramaphosa undertook to roll out national support and work readiness training by way of an intervention scheme that will address and aid the youth unemployment crisis.

Ramaphosa said during his SONA that 1% of South Africa’s budget would be set aside to assist with youth employment and that this initiative was one of six “priority actions” spanning five years to reduce youth unemployment that includes establishing ways for the youth of South Africa’s to receive work readiness training across various priority sectors via shorter, more flexible courses in specific skills under the Presidential Youth Employment Intervention which ‘kicks off immediately’.

Gareth Bird, Chief Operating Officer at leading skills development company, the Skills Development Corporation, says “According to StatsSA’s Quarterly Labour Force Survey (QLFS), 40.1% of our youth between the ages of 15-34 are not only unemployed, but are not even enrolled in any institution to help them improve their level of education or skills readiness that would empower them to find a job.” He says, “The fact that our President has made such a significant commitment both from a proactive planning and budget perspective means that there is most definitely a common understanding about the country’s unemployment rate directly correlating to the high levels of youth unemployment.”

Given SDC’s expertise in the skills development sector, Gareth shares his thoughts on some short- and long-term suggestions that government and businesses could look at to curtail this unemployment crisis;

·       We need to create an environment where companies are encouraged to invest in production and scaling their operations which can only happen with increased demand and lower interest rates on debt equity as well as lower income tax.

·       We’d suggest opening discussions for import partners to invest in local manufacturing plants to create more job opportunities in the manufacturing sector considering our cost of labour vs other parts of the world.

·       Naturally, large emphasis and responsibilities should be placed with South Africa’s State Owned Enterprises (SOE) to address, among others:

o   Levels of corruption within government and SOEs and the plans to recover what’s been lost and the plans to ensure South Africa doesn’t find itself in the same position down the line considering the pressure our economy finds itself in

o   Fixing the parts of Eskom that cripple the country with load shedding

“With these areas being addressed as even the first part of a bigger plan, we will already see levels of crime starting to decrease as people are empowered to find a place to earn money instead of having to explore criminal ways to make it,” Gareth observes. With the new down grade in the GDP growth forecast by Moody’s from 1,5% to 0.75% it poses another stumbling block for the public & private sector that essentially says our debt financing as a % of GDP grows and casts a massive shadow on the growth forecast. “Once we are able to stabilise and grow the economy and our SOE’s it will go a long way to securing a conducive environment where the private sector can grow exponentially.”

By stimulating growth through knowledge transfer and skills development, the private and public sectors can play a huge role in drastically decreasing the unemployment figures but this undertaking will require businesses to understand what the process is (which is an easy one with the right partners and industry experts), and how they’re able to roll it out within their own organisation.

SDC has made this super simple for businesses too by offering a free skills development audit. They’re also available to speak to via the SDC websiteFacebookTwitterInstagram or LinkedIn pages.