Youth Capital

Finding ways to transform the employment trajectory of young people

Youth Capital

20 million South Africans are under the age of 35.
This youth bubble has the potential to transform South Africa’s economic and social reality

20 million South Africans are under the age of 35.
This youth bubble has the potential to transform South Africa’s economic and social reality

What

Youth Capital, launched in 2018, is a campaign that strives to transform the employment trajectory of a generation of young South Africans. Achieving this long-term goal will rely on the insights and actions of young people, as well as the buy-in of policy-makers, the private sector and civil society to create a conducive environment for young people to thrive.

Broadly speaking, the campaign works in two ways: by building a body of knowledge that supports a national focus on key priorities for young people and by building a national network of young influencers who can collectively shape the sector around them.

The campaign has three priorities, namely shifting gears for education, transitions and jobs. By employing a number of strategies, the campaign is working to ensure that every young South African has the skills, support, and opportunity to get their first decent job.

“Youth Capital believes in driving a collective, national agenda for youth employment in South Africa through a set of clear and common goals. While youth unemployment may seem unsurmountable, by focussing on key levers – amplifying young voices and crowding in innovative solutions – we believe we can turn things around.”
Kristal Duncan, Youth Capital Project Leader

Young people repeatedly share how stressful it is to find the money to look for work. On average, they spend about R550 a month on job seeking – the majority of which is spent on transport and data costs[1]Graham, L., Patel, L., Chowa, G., Masa de Vera, R., Khan, Z., Williams, L. & Mthembu, S. 2016. Siyakha Youth Assets Report.. This means that in an income-poor household, young people are spending half of their monthly income looking for work[2]Statistics South Africa. 2016. Community Survey 2016..

Young people repeatedly share how stressful it is to find the money to look for work. On average, they spend about R550 a month on job seeking – the majority of which is spent on transport and data costs1. This means that in an income-poor household, young people are spending half of their monthly income looking for work2

Why

There are over 20 million young South Africans (aged 15-34) in South Africa, with young people aged 15-35 years old currently accounting for 36% of the South African population[3]Statistics South Africa. 2018. Mid-Year Population Estimates 2018..

A number of developing countries have capitalised on the ‘dividend’ created by a large youth bubble that is associated with demographic transitions. Scholars believe there is a window of opportunity in the process of demographic transition that can be seized, but that this requires smart, effective, and rapid social and policy change to support the various positive effects that a young population can create. They believe that ‘less developed countries’ – including South Africa – have a window between 2005-2035 to really capitalise on their youth bulge for strong economic and social prosperity[4]Kasprowicz, P. and Rhyne, B. 2013. Looking through the Demographic Window: Implications for Financial Inclusion. Centre for Financial Inclusion, January 2013. Available at here.

Notwithstanding the limitations created by an ineffective education system and an economy downtrodden by state capture and looting, our young people could be a major boon for the economy, and could build a positive social trajectory for the country. However, young people currently face a hostile and challenging society, in which there is very little focussed, innovative, and effective action to support them. We are missing out on their potential – and the potential they have to actively and positively shape the country.

Population pyramid

Source: Populationpyramid.net (see the sources for their visualisations here)

We cannot and should not write off a generation of young people – even as we seek to change educational outcomes and revitalise our economy.

A large percentage of South African young people are neither in employment, education nor training (NEET). Of the entire NEET population (15-35 year olds), 38% are between the ages of 15-24 . The fact that they are out of training and education puts them at a significant disadvantage to their peers.

NEET

The demographics of these young people vary considerably by province, district and municipal ward, indicating the need for a model of support that is tailored to their diverse needs and geographical contexts.

Source: 2018 Quarterly Labour Force Survey, second quarter; General Household Survey 2017. Analysis by SALDRU, UCT.

Read more: The Department of Higher Education and Training (DHET) has published a fact sheet on NEETs. Read it here.

The period in between leaving an education institution and entering the labour market is a particularly uncertain time for any young person, this is made worse for the majority of young South Africans (62%) who live in income-poor households and are therefore even more vulnerable[5]Statistics South Africa. 2016. Community Survey 2016.

There is still considerable untapped talent and skills that should be better channelled by better higher education and vocational training, more pathways into the world of work, and greater recognition of an emergent new leadership for public innovation in South Africa.

There is a major disconnect in the youth space between research, young people, and policy. Young people are rarely approached as a population group for whom there should be specific policy, programme, and planning options to be pursued. Research on youth generally remains stuck in the academic world with little real influence on policy and programmes. Young people who are actively seeking to drive public innovation have little access to the kind of information that could help them to reframe their issues and bring their experience to bear on critical challenges. Furthermore, policy-makers tend to operate in a vacuum, often unreflective of both solid evidence and young people’s experience. Even when policy-makers do focus on young people, it is often only when a specific youth policy process is underway rather than built into ongoing policy and planning across all departments and all levels of government.

The early childhood development (ECD) sector has clearly demonstrated that building a strong presence with a focus on policy and planning, which is connected to, informed by, and collaborates with programme implementers can achieve real focus and innovation. Youth Capital therefore aims to fill a gap in the youth sector by operating at the nexus between research, youth, policy and the private sector, with a focus on reframing the issues and sparking innovative action by young people, policy-makers, planners, the private sector and youth programmes.

Read more:Providing a multi-faceted package of support to young people’, co-authored by Ariane De Lannoy, Murray Leibbrandt, Najwah Allie-Edries, Lauren Graham, Nilmini Herath and DGMT’s Shakira Maharaj. First published by City Press, 16 June 2019.

In April 2019, the Competition Commission released its provisional report on its Data Services Market Inquiry, in which it prescribes new rules for mobile networks. In its preliminary findings, the Commission says that international benchmarking confirms South African data prices are high – particularly for mobile prepaid data. The Commission also found that South Africa’s data pricing is ‘anti-poor’ and lacks transparency.

In April 2019, the Competition Commission released its provisional report on its Data Services Market Inquiry, in which it prescribes new rules for mobile networks. In its preliminary findings, the Commission says that international benchmarking confirms South African data prices are high – particularly for mobile prepaid data. The Commission also found that South Africa’s data pricing is ‘anti-poor’ and lacks transparency.

How

Youth Capital focusses on finding ways to ensure that every young person is equipped for and/or connected to their first decent job. This is done by mobilising a network of young people around the issues of unemployment and by creating a platform for collaboration among stakeholders. The campaign’s four main strategies are to:

  1. Drive a collective, focussed, evidence-based agenda for youth employment. Youth Capital synthesises key data, research, policy and the experiences of young people around critical challenges, with an eye for the opportunities for public innovation.
  2. Amplify the voices and power of young people to define the youth employment agenda.
  3. Crowd-in innovative solutions to increase youth employment, and challenge the private sector, civil society and government to implement breakthrough strategies.
  4. Inform and influence the people, policies and practices that define the trajectory of young South Africans. Youth Capital is committed to framing critical issues impacting youth employment and to communicate useful evidence, information and data to young people and organisations working on these issues. Through communication and engagement, Youth Capital aims to raise the public profile of such issues and to share potential approaches to addressing them.

Watch: Youth Capital regularly consults with young people and works to create spaces for them to tell their stories. Watch some of their stories here.

Have a look: The Youth Capital Political Scorecard reviewed political parties competing for the vote in the 2019 general election to see which parties had a youth and employment focus.

These four strategies are applied to Youth Capital’s agenda, which entails three key objectives ranging from education to career progression in the workplace. Each of these objectives is important to support a young workforce equipped to shift the economic and social trajectory of our country.

Objective 1: Shift gears for education

Too much of a young person’s success is still determined by things beyond their control. For example, the income of their family, the quality of their school, the community in which they live, and the colour of their skin – to name but a few. These factors set different rules and expectations for young people who are navigating their way through the education system. We know that the stakes are high: almost half of Grade 1s will not make it to matric; 40% of enrolled undergraduate students will not graduate within five years; and most TVET students do not complete their qualification[6]Van Broekhuizen, H., van der Berg, S. & Hofmeyr, H. 2017. Higher Education Access and Outcomes for the 2008 National Matric Cohort. Stellenbosch Economic Working Papers 16/16. [7]DNA Economics. 2016. Performance and Expenditure Review: Technical and Vocational Education and Training.. Obtaining a post-school qualification is an increasingly important entry point to the labour market. For the past 20 years, South Africa has prioritised access to education. Now that we have made real strides in enrolment, with near universal rates of enrolment in school, we have to shift our focus. Our shared goal must be to ensure that everyone who starts school (or a university or college qualification) is supported to complete it. Youth Capital believes the following are key ways to achieve this:

  • Wrap-around support: Young people need support beyond the classroom that is packaged in comprehensive ways. One way we can start working towards this is to ensure that attendance registers are kept at high school. In this way learners will know that someone is noticing whether or not they attend school, and educators will more easily be able to identify those learners who may require extra support.
  • Catch-up strategy: Without exposure to early learning, basic numeracy and literacy, most children do not have the foundations in place that further education can build upon. In the long term, we have to turn South Africa’s education system around, but while the current system is tended to fail, a national catch-up strategy must be an urgent, shared effort across schools, colleges, universities and places of employment.

Overhaul colleges: The college system in South Africa is crucial to ensuring that the economy has the technical and vocational skills it needs to grow. These institutions are wells of potential to develop young South Africans. However, most colleges are simply not functioning. We have to get them working, starting with a quality index and a plan for rapid improvement. While these are big goals, there are things that we can do today, while working towards them. For example, by ensuring that everyone receives their graduation certificate promptly after graduating, we will enable all graduates to signal their qualifications to potential employers.

Objective 2: Shift gears for transitions

More than 1.5 million young people have been looking for work for more than three years[8]Statistics South Africa. 2018. Statistics South Africa Quarterly Labour Force Survey Trends, Quarter 2 2008- 2019.. Much of this is to do with the scarcity of economic and education opportunities in South Africa, combined with the barriers to accessing the ones that exist. Adding to this complexity is the fact that young people struggle to hold on to the connections they do manage to make. While levels of education have some effect on this, their inability to hold on to opportunity is also embedded in their intense vulnerability across areas of health, safety, wellbeing and poverty. Most young people in SA lack social capital — in other words, they do not have the social network in place to find work. Consider that 42% of people aged 15 to 24 live in a household without an employed adult – a significant disadvantage in an age when social networks are the most successful way to find a job[9]Statistics South Africa. 2016. Community Survey 2016..

Another hurdle in the way of youth finding jobs is the high cost of data. The recent findings from the Competition Commission’s Data Services Market Inquiry are heartening as they confirm what many have been saying for far too long: data is too expensive and “anti-poor” in that small data bundles cost more per MB than the larger bundles that wealthier people can afford. With this in mind, the recommendations for immediate relief on data pricing and the zero-rating of content/services provided by public benefit organisations (PBOs) pave the way for greater inclusion and innovation to support young work-seekers stuck in limbo.

Youth Capital believes that South Africa has not yet understood how best to support young people as they transition out of school and into the world. We have to open our eyes to the systemic vulnerability of transition and pool our social capital, national resources, and information around young South Africans to ensure that they thrive. Towards this end, the campaign believes the following is needed:

  • Multi-faceted support: Moving out of an education institution and into the labour market is difficult for many young people – compounded by social and economic vulnerabilities that drastically limit the possibility of success. In addition, young people’s mental health is significantly compromised by the combination of poverty, isolation, and uncertainty. To smooth this transition period, young people must be actively connected to multi-faceted, responsive support that ensures they are equipped, both mentally and physically, have the necessary resources and are supported to find work.
  • Diversify/expand networks: We need a society-wide commitment to transform and enrich the networks of young people.

Lower work-seeking costs: The costs of looking for a job (such as mobile data, internet cafés, CV printing, and public transport) are a major barrier to young people. To ensure they can effectively look for work, we must develop a strategy to support work-seeking activities.

Learn more: Zero-rating mobile services – An easy win that can significantly boost socio-economic development.

Read more: Youth will shape the South Africa of tomorrow – let’s get behind them today! Read the introductory article to DGMT’s toolbox to support young people in South Africa, by DGMT deputy CEO, Janet Jobson, here.

Objective 3: Shift gears for jobs

Young people are joining an ever-growing line of job seekers – many without the skills the labour market needs. For every 100 labour market participants each year only 43 are able to find jobs[10]Statistics South Africa. 2018. Statistics South Africa Quarterly Labour Force Survey Trends, Quarter 2 2008- 2019.. If young people are lucky enough to find a job, they often get stuck in entry-level jobs, without progressing further, while we have a major skills gap at middle and senior management levels. We cannot expect young people on their own to solve the crisis of youth unemployment. Fixing it is everyone’s responsibility – we need to create an environment for a thriving economy, where there are enough job opportunities for all new entrants. Skilling, mentoring, and progressing our workforce are crucial to building dynamic career pathways that will result in a capacitated work-force to drive South Africa’s economy forward. To this end, we need to:

  • Capitalise on the informal/social economy: In developing countries the informal sector works in tandem with the formal economy – with acknowledged pathways between both sectors. An evidence base must be built to identify valued skills and experiences in the formal and informal sectors in so that we can support young people to transition between the formal and informal economies. In addition, the social economy is growing rapidly in South Africa as people are driven towards addressing the needs in their own communities. These needs cover the areas of early childhood development, education and health. We need a better understanding of how this economy works and how it can be grown to provide more jobs.
  • More learnerships/internships: While there are a number of existing initiatives already aimed at addressing this issue, few have been maximised for impact at scale. We must unblock SETA funding mechanisms and understand how to capitalise on efforts like the YES[11]YES is a  collaborative economic enabler led by business with government and labour for youth, with an aim to create 1 million jobs for young people – www.yes4youth.co.za and the ETI[12]ETi (Employment Tax Incentive) The Employment Tax Incentive (ETI) is an incentive that was launched by SARS with the aim of encouraging employers to hire young job seekers. It reduces the cost of hiring young people by reducing the amount of PAYE owed by the employer to SARS without affecting the employees’ wages. Read more and use this knowledge to implement smart incentives for creating opportunities. Current opportunities for learnerships, internships and jobs must be advertised more widely. We also need to make entrepreneurship support more accessible for those young people who are equipped and interested in creating their own opportunities.
  • Re-design public employment: Research is needed to understand how public employment schemes like the EPWP[13]The EPWP is the Employment Public Works Programme and it recognises the dignity of work, and provides a safety net for the unemployed in South Africa. could be re-designed in order to understand and support potential career paths for young people.

Read more: ‘Creating jobs and improving education at the same time’, by DGMT CEO, David Harrison and DGMT Innovation Director, Shakira Maharaj. First published by the Daily Maverick,8 February 2019. Read it here.

Have a look: JobStarter is the go-to information, learning and opportunity aggregator for youth.

WATCH: Youth Capital has summarised its cause and strategy in this brief video

Innocentia Vilakazi is another young person showing the social awareness with which many South African young people are approaching the opportunities life offers them. The 29 year old is a highly-skilled and respected welding instructor at the Don Bosco Skills Development Centre in Ennerdale, Gauteng. Don Bosco is a non-profit organisation in Gauteng founded by the Salesian Sisters whose focus is educating and empowering youth and children who, for various reasons, are unable to sustain a formal education. She chooses to work at the training facility as opposed to a more commercial and lucrative job for two reasons. One, so that she can work close to home and spend more time with her two small children. And secondly, because she believes strongly in helping the community overcome their challenges and succeed in life. Photo by Bart Love, November 2018.

Innocentia Vilakazi is another young person showing the social awareness with which many South African young people are approaching the opportunities life offers them. The 29 year old is a highly-skilled and respected welding instructor at the Don Bosco Skills Development Centre in Ennerdale, Gauteng. Don Bosco is a non-profit organisation in Gauteng founded by the Salesian Sisters whose focus is educating and empowering youth and children who, for various reasons, are unable to sustain a formal education. She chooses to work at the training facility as opposed to a more commercial and lucrative job for two reasons. One, so that she can work close to home and spend more time with her two small children. And secondly, because she believes strongly in helping the community overcome their challenges and succeed in life. Photo by Bart Love, November 2018.

Progress

Youth Capital launched in 2018 and spent the year designing its approach and developing its brand and resources. Since its launch, Youth Capital has:

  • Established a network of approximately 300 young people across South Africa to share knowledge, learnings and opportunities through workshops and continued dialogue on social media. This has led to the hosting of workshops across five provinces.
  • Empowered youth during the 2019 election campaign to harness their agency and canvas their fellow youth about the problems they face. This was done by giving young people who took part a transport and data stipend to reach polling stations and start discussions with their peers.
  • Youth Capital plans to substantially grow its network of young people across the country in 2020, while at the same time making sure that the voices of young people are present in discussions on policy and implementation that affect the lives of young people.

Read more:‘David, Goliath and half a gig of data’, by DGMT Innovation Manager, Shakira Maharaj. First published by City Press, 03 February 2019. Read it here.

Access DGMT’s ‘Create Change Resources: Step up for Young People’ here.

Support our youth

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