GeneralBusiness & Finance

Young South Africans innovate and hustle to beat unemployment

To solve South Africa’s dismaying youth unemployment challenge we must end the pervasive narrative that South Africans, and particularly young unemployed South Africans, are reliant on the government. 

It’s quite simply not true, as a recent African Response survey has revealed. Among the respondents who classified themselves as unemployed and looking for work, 41% are earning up to R15 000 a month through income-generating activities such as baking, building and hairdressing. What this shows is that many of our young people are resilient and inventive about making ends meet. We need to reinforce that and build their confidence so that that attitude catches on.  

The survey, answered by 603 respondents aged 18 to 34, was conducted via our MzansiVoice online platform, which offers access to a community of more than 14 000 individuals in the low- to middle-income market segment.

Statistics South Africa’s youth unemployment rate, which measures job-seekers between 15 and 34 years old, has consistently been above 30% since at least 2013. In the first quarter of this year it reached a record 45.5%. When a troublesome trend lasts for more than a decade, new solutions must be sought. 

But what our survey reveals is that the majority of the individuals behind the statistics – 90% black, 50% living in Gauteng, 37% living in township areas – already have a can-do attitude. 

When we focus on the segment that report earning up to R15 000 a month, the statistics start to tell us an interesting story. They highlight a cohort that, despite considering themselves to be unemployed, are still active in terms of earning an income through other means.

Young South Africans innovate and hustle to beat unemployment

They list taking on short-term contracts or freelancing, running their own businesses, working at what they describe as side hustles, renting rooms or homes, earning investment income and doing odd jobs. Just over a quarter (26%) said they relied on social grants and 13% listed the National Students Financial Aid Scheme as an income source.

Our young people are anything but helpless and reliant on the government. The pervasive narrative that the government should be solving the youth employment problem by providing young people with jobs is potentially psychologically damaging. What our young people need is encouragement where they have created their own pathways to earning an income, initiatives that stimulate the youth’s drive towards creating their own income pathways, and the reassurance that they can build a financial future for themselves.

For one, the resilient adaptability that this age cohort shows is going to be the superpower of the future. The world is rapidly changing, and South Africa along with it. There is no new normal, there is just constant change. 

The world of work is being revolutionised by technological change, not least the increased use of automation and artificial intelligence. Instead of being afraid of it, we should be equipping and encouraging young people to embrace this change.

Our survey also underlined another long-standing trend, one that is not likely to help young South Africans in the new world of rapid technological change, including the unfolding transformation that artificial intelligence and machine learning are causing. 

The trend is an over-reliance on formal, university education as a panacea. This might sound counterintuitive; however, it is notable that despite South Africa’s graduate unemployment rate being significantly lower than the national unemployment rate, it has increased dramatically over the past decade. 

Graduate unemployment was measured by Statistics South Africa at 10.6% in the first quarter of 2023. In the first quarter of 2013, it was 5.5%. Worse, unemployment among those with tertiary qualifications not gained via a university has grown even more, almost doubling from 11.9% in the first quarter of 2013 to 23.5% in the first quarter of 2023.

The National Development Plan’s vision of seeing the majority of young people’s post-school instruction taking place at technical and vocational education and training (TVET) colleges is not happening according to plan. 

While there is a small number of TVET colleges that perform well, on average poor programme relevance and quality, which leads to poor employment prospects and low earnings potential, has led to an over-emphasis on university-level education.

Yet South Africa has such a severe shortage of artisanal skills it is a constraint on economic growth, according to research by a number of organisations, including the Steel and Engineering Industries Federation of Southern Africa. 

Something is wrong.

Our education system needs a shake-up. So does the national mindset. We need to put aside the stigma associated with blue-collar work. Good artisanal skills are sought after, and not only in South Africa – there is a global shortage – and many of them are future-proof in ways that knowledge-economy skills are not. 

We need to focus on programme relevance and ensuring that those who leave tertiary education come equipped with the skills, including soft skills, that they need to thrive. 

Additionally, the businesses and government departments that offer learnerships to young people who have knowledge-economy skills need to think seriously about the quality of those learnerships. We need to offer those young people real opportunities to gain solid experience that makes them more marketable.

When our young people begin to believe in themselves in larger numbers, when they are educated with the skills they really need, and the skills that the economy needs, and when they are educated to have a mindset that looks for and creates opportunities, we will be able to close this gaping hole in our society that is filled with young, unemployed people. South Africa is crying out for people with artisanal and engineering skills, digital literacy, critical thinking and adaptability.

Our survey reveals that the perception is that the more educated you are, the more job opportunities you will have. Among the young employed cohort we surveyed, 42% are continuing their studies. In addition, 44% of the full survey sample are studying or have studied towards a qualification they believe will give them the best job opportunities in South Africa.

Some of them are going to be disappointed. While this is partly because South Africa is mired in a stagnant economy, we have to ask why our education system is not producing the skills our economy needs. 

An education system, and public narrative, that emphasises an entrepreneurial, self-reliant mindset is a good place to start.

By Mamapudi Nkgadima, CEO of African Response

    Flow Communications
    Mamapudi Nkgadima (CEO of African Response)
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