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Latest Unemployment Stats Highlight Dire Need For Youth Entrepreneurship

According to the latest research by Statistics South Africa, the rate of unemployment among South Africans aged between 15 and 34 years, currently stands at 46,3 percent – and youth aged 15 to 24 years are the most vulnerable with over 63 percent of them not employed or in institutions of learning – these stats have worsened due to the pandemic. This number could however be significantly reduced if the public and private sector joined forces to build a supportive entrepreneurial ecosystem for the younger generation.

This is according to David Morobe, Executive General Manager of Impact Investing at Business Partners Limited, who recognises that youth employment is in dire straits. “As June 16 marks National Youth Day, I believe we need to acknowledge that this is a situation that threatens the future of our country. When you have so many young people without viable employment opportunities, you have a recipe for instability and economic hardship.”

He adds that naturally the turbulent economic landscape plays a pivotal role in the youth unemployment crisis. “Even before the advent of the pandemic, South Africa’s economy was struggling. As soon as the nationwide lockdowns started last year, many businesses started to shed jobs – and there is still very little room in the rest of the market to absorb all of the people whose jobs have been shed. Entrepreneurial attitudes have also been affected, with many having lost motivation to create their own opportunities through entrepreneurial activity. These factors, coupled with an increasing population, invariably impacts the country’s youth the hardest.”

Still, Morobe believes that there are viable ways of meaningfully growing youth employment despite the massive challenges. “As an  SME Investment specialist, my background might not be in education, but I sincerely believe that education continues to be one of the most important ways to create opportunities for the youth. Honing the skills of those who are able to participate in the economy, directly leads to better production capacity, increased job opportunities and a rise in entrepreneurial activity. Yet the quality of education for the vast majority of our country’s youth is still lacking and many education specialists believe it will be worsened by the pandemic for the majority of our youth.”

Morobe therefore proposes that both the public and private sectors start placing more focus on improving opportunities for high-quality, affordable education in the country. “Online learning is just one of the viable solutions to this problem. It enables learners to access courses and textbooks and minimises the issue of space in schools and universities. Given the demand for better education (especially in maths and science), investing more into this sector will definitely yield many benefits for government and private sector companies alike.”

Business financiers also have a part to play in growing opportunities for youth in the economy. “By way of example, our annual Business Plan competition has been developed specifically to inspire young people to start their own businesses. It offers guidance and practical training for the youth that enter this competition each year, and ultimately offers funding, mentorship and technical assistance for the winners’ businesses. It may only reach a handful of aspiring entrepreneurs each year, but it potentially leads to many new job opportunities down the line. This year is our 40th year as an SME financier and our initiatives have led to over 658 000 jobs being sustained over the years. Now more than ever, we’re excited about the prospect of uplifting the youth using our experience and expertise in the business arena.”

Lastly, Morobe says that South Africa’s broader business community can help to make a difference. “I believe that business owners should be ambassadors for entrepreneurship. They can contribute by encouraging others in their communities to create their own enterprises. They can also offer mentorship where they see the opportunity, which is incredibly valuable for any young entrepreneur. Having a positive impact on just one aspiring young entrepreneur, can have a big ripple effect.”

In closing, Morobe says that getting involved in initiatives that grow youth employment should be a priority for both the public and private sector. “It doesn’t require massive plans and huge investments. Even small efforts can have good outcomes and help to secure our country’s future, and hopefully result in increased employment for our youth.”