Model Setas on thriving YES programme

The model underpinning the sector education and training authorities (Setas) is the wrong one for tackling South Africa's youth unemployment crisis.

This is the view of Ravi Naidoo, CEO of the Youth Employment Service (YES) – a private sector-led initiative launched in 2018 which has placed 194,000 young people for a year long in jobs sponsored by the participating corporates.

Naidoo said Seta training is often misaligned with the needs of the corporate sector, producing skills that many companies do not prioritise and failing to provide the kind of hands-on experience and networking opportunities that YES offers.

“The Seta model is really the wrong model for the country,” he said. “Because you need something that is much more demand-led, connected to what companies need, much more flexible. But by the time you can get approval for a qualification linked to AI, they'll still be approving things from three years ago.

“Even if you had all the people you think would be the best in Setas, institutionally it's like a supertanker when you need a speedboat; you can't turn it. And the economy now needs more fast-reacting things,” Naidoo said.

The Seta model was set up in a way that was not attractive for influential people in the private sector to fully participate in, as it involved spending many hours in meetings.

“Even when they have private sector participation, it's not the right people from the private sector in most cases, because they have dropped out. It's their junior's junior's junior, and some of the companies don't even want to participate. I think if they could totally redesign the model ... they could save it,” Naidoo said.

Setas – funded through a skills development levy obtained from payroll contributions of 1% by larger employers – have been in the news of late over allegations of corruption and ministerial attempts to influence board appointments.

Recently, the DA and EFF challenged higher education minister Buti Manamela over appointing allegedly dodgy individuals to key administrative positions in a number of Setas.

According to figures for the 2024/25 financial year, YES created 43,088 full-time jobs, outperforming all 21 Setas combined, which delivered 24,632 learnerships and internships.

The unemployment rate for individuals aged 15–34 is 46.1%, but rises to 62.1% for those aged 16–24.

YES provides full-time, 12-month learnerships in specific industries, partnering with more than 1,000 companies to bring new cohorts in. It has 43,000 trainees on its books this year, placed at a number of top companies, including The Foschini Group, BMW, Famous Brands and Microsoft.

Since its inception in 2018, YES has created more than 194,000 jobs, with about R11.3bn paid to youth beneficiaries. Many are absorbed by the companies that place them in the programme, obtain employment elsewhere, or start their own businesses.

Naidoo said YES prioritises placing young people in sectors with high retention rates.

While the programme did not facilitate placements in government-run organisations, participants who went to state institutions often struggled to stay employed after the 12-month period because of overly bureaucratic human resources processes that restrict budgets to retain them.

According to YES, 17% of its alumni, or 28,080 former beneficiaries, have gone on to start their own businesses.

Naidoo said the initiative provides opportunities mostly for vulnerable individuals, with 74% of participants coming from social grant-recipient households. Through the initiative, 44,000 social grant households have moved above poverty thresholds, with more than R1.61bn in salaries injected into rural communities.

YES COO Samantha Steyn said the initiative aimed to “support entrepreneurial youth”, helping them build the resilience to succeed professionally.

Those placed in jobs and those who have gone through the programme are continuously offered support. The initiative has outsourced its call centre to a private company located at its head office, which has the capacity to make 40,000 calls a month to present and past beneficiaries.

Steyn said YES was able to offer a range of support through the Mindful Matters programme launched with Skyed in 2023 to offer free counselling, career guidance and mental health support. The calls also form part of its monitoring and evaluation protocol, ensuring regular company check-ins and tracking participants for up to three years with ongoing career support.

Naidoo said the initiative had so far engaged 4.8-million young people.

While regulations currently require businesses to “get permission to join YES”, he said that based on the programme's proven impact in creating youth employment and improving employment equity, it “should be a priority”.

The programme had significant scalability potential and could create 660,000 extra jobs a year if certain conditions were met, Naidoo said. These include:

• Recognising YES under the skills development pillar and as a priority under the broad-based BEE scorecard.
• Offering tax incentives for small and medium enterprises that hire youth through YES.
• Asking foreign investors to direct 30% of their equity equivalent contributions to youth employment.

With the support of the department of trade, industry & competition, the organisation estimates it could create between 750,000 and 2.2-million jobs by 2030.

Naidoo said YES requires companies to retain 95% of learners in a programme, allowing only a 5% dropout rate. This helps to ensure that youth receive consistent training and real workplace exposure.