Publication: The Star - Business Report
Author: Ravi Naidoo
Photograph: YCC
In a world that is becoming increasingly divided, South Africa stands at a technological crossroads. As the COVID-19 crisis demonstrated, the world is bifurcating between those countries that possess technological capabilities (i.e. make vaccines) and those that lag behind (i.e. beg for vaccines).
Hence, vaccine-producing rich countries kept six vaccines per citizen before they consented to release vaccines to Africa (which barely could get six per 100 people).
It is critical that we are part of the former group and not the latter.
Moreover, with technological capabilities enabling a “cross-species transmission” – for example, Huawei, better known for making cellphones, has just produced a state-of-the-art SUV. Expect many industries to be massively disrupted.
Hence, we must prepare young people to be effective in that technology-driven future.
As a highly unequal country, South Africa, in parts, resembles both the most advanced and the more under-developed economies. The better-off 20% of the population are well prepared for this future. The good news is that the remaining 80% also has some global advantage – derived from the fact that South Africa adopted cellular technologies before most of the world.
Our problem is that while youth may be intrinsically tech-savvy, they lack the work experience to demonstrate their employability to potential employers.
Moreover, the traditional approach to preparing young job seekers via formal accredited education and skills development needs urgent reform.
Apart from the high costs to the taxpayer – one programme in 2023 required R17 billion and produced just 22,000 successful graduates – the process of getting formal accreditation often means they're outdated before learners even graduate.
An alternative pathway to employment is to upscale quick-to-market, non-accredited training programmes, and private sector collaborations.
Mobilising our tech-savvy youth through active collaborations will help South Africa develop competitive industries.
For example, South Africa is a world leader in non-banking finance (think of Yoco-like trading apps that provide verifiable trading histories for small businesses, making them much more bankable).
Countries are competing to lead in this digital economy, and South Africa is surprisingly well placed.
With our mix of modern industries and long-run use of mobile technologies, South Africa is a land of potential.
First, we need to ensure that digital infrastructure is rolled out to rural and township schools. High-speed data infrastructure needs to be rolled out everywhere and provided as a “basic service.” This will be a good public investment as citizens accessing data can support better performance management at the municipal level.
Second, public education needs a radical reform, focused on ensuring up-to-date digital fluency – not just old-fashioned “computer literacy.” Even better, if we use this digital injection to integrate online and AI-enabled learning tools into less-resourced schools. Again, that public investment will pay good returns to society.
Third, as important as infrastructure and skills development are, more important is that young people must get a chance to put their skills to work or else whatever is formally learned will depreciate over time.
But where will such on-the-job experience come from? Ideally, the South African economy would be growing by 5% a year, like many of its global peers, and generating youth employment.
Instead, economic growth has averaged 1% a year for the past 15 years, barely matching population growth – meaning job creation is at a virtual standstill. In that environment, employers will pick older, experienced work-seekers for even entry-level posts, leaving youth last in the queue. Hence, youth employment has skyrocketed to 55%.
Special employment measures are needed to ensure our talented youth are not left behind, even while economic reforms are being implemented.
The government and business are collaborating more through the Presidential Youth Employment Initiative (PYEI), to ensure better pathways from schools to employment.
The PYEI has proposed a package of measures to reduce youth employment from 55% now to 35% in 2030.
Within that PYEI model, the Youth Employment Service (YES) gets motivated youth from disadvantaged backgrounds into their first work experiences with the private sector.
Despite being a voluntary programme with no taxpayer funding, YES has become South Africa’s largest 12-month youth jobs programme. To date, 1,834+ corporates have funded 168,300 youth at a run-rate of 3,000 additional youth a month. To focus on the reality of a technology-driven future, every single young person gets data-free access to work readiness modules, which include online foundational courses in AI.
With many youth understanding the need to be entrepreneurial, 18% of YES youth simultaneously started their own businesses in 2024.
Already thousands of empowered youth are building their careers and will, in turn, help build our economy. Many will work in or even establish future-facing companies.
YES is now actively looking to recruit motivated graduates of Technical and Vocational Education and Training (TVETs) and other public skills programmes, as an opportunity to strengthen employment pathways.
If you are concerned about the future, then empowering youth through quality first-job experience is the most effective endowment you can make.
Ravi Naidoo is the CEO of Youth Employment Service.