Upskilling poorly educated job-seekers is key to fixing unemployment

Jobseekers without skills and low economic growth are two crucial challenges that need to be tackled for South Africa to beat unemployment.

Data in the 2018 edition of the South Africa Survey‚ published by the South African Institute of Race Relations (IRR)‚ underlines the urgent need for investment‚ economic growth and policy reforms - especially in education.

The data show that‚ in a country in which only 21% of people with jobs have tertiary education‚ sectors that have traditionally absorbed low and semi-skilled labour account for a decreasing contribution to employment‚ in contrast to the growing dominance of high-skills sectors.

Most formally employed people in South Africa work in just three sectors

– government‚ trade and finance

– which each employ more than two million people and‚ together‚ account for some two

-thirds of people in formal employment.

The findings in the Survey show that:

- Government employment accounts for 2‚042‚759 jobs‚ or 21% of formal employment. This includes jobs in city councils‚ health commissions‚ parastatals and institutions of higher learning;

- Trade contributes 2‚097‚092 jobs or 22% of formal employment;

- Finance accounts for 2‚173‚830 jobs or 23% of formal employment.

IRR analyst Gabriela Mackay said this trend is worrying since other sectors such as mining‚ manufacturing‚ and construction - which collectively accounted for close to 40% of formal employment in 2001 - now account for only 23% of such people.

Mackay said: “In a country where only 21% of people employed have tertiary education‚ the decreasing contribution of sectors that have traditionally absorbed low and semi-skilled labour is worsening the problem of unemployment. This is because many of those looking to enter the job market do not have the requisite abilities to perform high-skilled professions. Also‚ people without some form of tertiary education find it harder to find employment.”

The scale of the challenge is borne out by statistics showing that‚ by the official definition‚ South Africa has an unemployment rate of 27.7%‚ or over 6-million unemployed – a figure that climbs to over 9-million‚ and a rate of 36.6%‚ if the expanded definition (which includes discouraged job-seekers) is used.

Mackay said that South Africa is likely to continue facing high levels of unemployment if it cannot find a way to both train and upskill jobseekers‚ while simultaneously promoting investment-driven growth.

“Reliance on the community‚ social‚ and personal services sector (which includes government) to create jobs is not a long-term solution as this cannot be sustained amid increasing debt levels‚” Mackay said.

“Instead‚ better education and training‚ renewed investment and economic growth should be the means by which South Africa seeks to combat unemployment.”

Equal Education‚ in January‚ also flagged education as a priority area in the drive towards reducing unemployment.

"Poor quality basic education that sees alarming numbers of learners drop out of school before reaching matric‚ contributes to unemployment‚" EE said. It quoted research from the Human Sciences Research Council (HSRC) as stating that adequate skills development depends on“high levels of general education upon which appropriate forms of vocational and career-oriented training can be optimally built”.

Learners who pursue vocational studies also encounter uneven quality‚ said EE. The pass rate for the National Certificate Vocational (a qualification with a mixture of theory and practice) averages 42% and approximately only 2% of students complete the qualification within the minimum period of three years.

"It is imperative that poor quality teaching and learning‚ and poor throughput rates in basic education and in TVET colleges be urgently addressed by the Departments of Basic Education and Higher Education. It is the responsibility of the State to provide young people with an education that ensures that they are well prepared to participate in society and in the economy."

Commenting on skills development‚ the EE said: "Considering that almost half of South Africa’s employed and 60% of the country’s unemployed did not complete matric‚ it is imperative that Skills Education Training Authorities (SETAs) spend their budgets to develop ... both general and occupation specific skills training programmes."

In addition‚ given the high numbers of employed and unemployed persons who have not reached a National Qualifications Framework Level 4 (the level of matric)‚ EE highlighted problems at Community Education and Training (CET) colleges. A 2016 report by a research consortium led by the HSRC revealed that many community colleges “do not have effective capacity or staff to deliver effective basic skills training”.

Commented EE‚ "The report is correct in advocating for the fast tracking of an initiative for improving the capacity of teachers to deliver the college programmes‚ and for learning materials to be developed."

President Cyril Ramaphosa has announced a jobs summit will be held within the next few months to harness the best minds on job creative initiatives.

In January‚ he acknowledged the need for upskilling to redress youth poverty and unemployment. He said: “Many of them lack the requisite skills to meet the demands of a modern and diversified economy ... We need to agree on a social compact that will absorb many of our young people in skills training programmes‚ internships and employment opportunities."

He announced that a Youth Employment Service would be launched this year‚ with the aim of placing a million unemployed youth in paid internships over the next three years.