speech of unemployment in south africa

Ramaphosa addresses South Africa’s unemployment in nation address

As the country faces one of highest jobless rates globally, South African president pledges ‘to leave no one behind’.

Cape Town, South Africa – President Cyril Ramaphosa has pledged “to leave no one behind” in addressing the country’s high unemployment rate in his sixth State of the Nation Address.

The yearly speech took place on Thursday at Cape Town City Hall, instead of the usual location of Parliament, for the first time in its history.

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The venue changed after a fire on January 2 gutted the Parliament building, causing the roof of the New Wing housing the lower chamber National Assembly to collapse. A 49-year-old man has been charged in connection with the fire.

Africa’s most industrialised nation has one of the highest unemployment rates in the world. As of the third quarter of 2021, the latest data available, it had a 34.9 percent unemployment rate.

In his speech, Ramaphosa acknowledged the country needed “fundamental change and reforms” to revive its economic growth.

“COVID-19 has exacerbated the divide between those who are employed and those who are unemployed. Last year our unemployment rate reached its highest recorded level,” he said.

The president said the problems with the South African economy were both “deep” and “structural”.

“Where electricity supply cannot be guaranteed, when our railways and ports are inefficient, when innovation is held back by a scarcity of broadband spectrum, water quality deteriorates in our municipalities and where we live. Companies are reluctant to invest and the economy cannot function properly.”

To address this, the African National Congress (ANC) leader promised “far-reaching structural reforms” that will modernise industries to unlock investment, grow the economy and create jobs.

“We know, however, that even with the best business environment and much faster rates of economic growth, it will take time for the private sector to create enough jobs for the millions of South Africans who need them. Our intent is to leave no one behind,” he said.

He pledged to create better livelihoods by prioritising infrastructure projects in energy, roads and water management.

Ramaphosa also said South Africa’s transition into a green economy would create jobs in mining minerals that help provide clean energy, as well as green hydrogen, solar and wind.

The country’s global business services sector is on track to create 500,000 new jobs over the next few years, Ramaphosa added.

He also touted the country’s growing hemp and cannabis sector, which he said could create more than 130,000 new jobs.

The wide-ranging speech that lasted nearly two hours saw the president addressing areas from gender-based violence to state corruption. A shadow hanging over the ANC is the State Capture inquiry into corruption and fraud in the public sector, including in former president Jacob Zuma’s government.

The Zondo Commission was launched in 2018 to look into the allegations, and the inquiry published the first two out of three reports into the scandal in January and February.

“While the definitive conclusion has yet to be delivered and will be at the end of this month, the first two parts of the report make it plain that there was indeed state capture. This means that public institutions and state-owned enterprises were infiltrated by a criminal network intent on looting public money for private gain,” Ramaphosa said.

“We must now do everything in our power to ensure it never happens again,” he added.

Ramaphosa said he would present a plan of action by June to respond to the commission’s recommendations and he pledged to bring the criminals involved to justice.

South Africa saw its economy ravaged by deadly riots last year that swept across Gauteng and the eastern province of KwaZulu-Natal, causing more than 25 billion rand ($1.7bn) worth of damage and killing 337 South Africans. Some private security companies were found to be involved in the unrest.

Ramaphosa said he would be making several leadership changes in a number of security agencies to strengthen the country’s security structures and take heed of the recent report into the riots, which concluded there was poor coordination between the state security and intelligence services.

‘Very significant shift’

South African political analyst Daniel Silke told Al Jazeera in his speech Ramaphosa identified core areas in business and governance “that require attention”, but whether they can be implemented is another question.

“The big hope certainly from an economic point of view this year is that the government does open its doors a lot more to the private sector,” he said.

“Now what was emphasised in the first part of the speech was this very issue and in fact, Ramaphosa emphasised correctly – that now is the time ultimately for the private [sector] to drive job creation.”

Silke said the speech marked “a very significant shift” from the ANC’s previous stance, because it acknowledged the party’s “failure of the state-centred approach to business” and was more welcoming of the private sector.

Bianca Chigbu, a lecturer and economic sociologist at the University of Fort Hare, was more sceptical.

“As Ramaphosa said, businesses create jobs but we know that such businesses prefer cheap labour and, therefore, will employ immigrants due to their willingness to accept lower wages. Their idea of leaving the responsibility of job creation in the hands of businesses will be futile and the locals will be disadvantaged,” Chigbu told Al Jazeera.

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The struggle of unemployment: A South African perspective

South Africa achieved independence in 1994, but years later, there has been little improvement in the general populace’s poverty levels. While the country remains one of Africa’s strongest economies, statistics indicate that close to 50% of the population lives in poverty. (Based on south African government poverty measure where the upper bound poverty line is approximately $70 per month.)

The covid-19 pandemics have exacerbated the issues of poverty in the country. South Africa has one of the highest infection rates in Africa and more recently has been dealing with a mutated version of the virus that has since been christened the South African variant. Lockdowns and covid 19 restrictions have pushed many out of employment, and businesses have been forced to shut down. Estimates indicate that close to 1million people may fall below the poverty line.

According to a World Bank Report , the inequality of apartheid lives on. The report indicates that inequality of opportunity is extremely high in the country. 

To compound issues, unemployment among youth stands at more than 50% , substantially higher than comparable countries.

South Africa’s economic issues run deeper. The economy is not growing enough to absorb its youth and reduce the trends in employment. Compounded by the lack of equal access to education and other services, the youth are not adequately set up for employment.  Part of the challenges stems from the inadequate capacity generated in the manufacturing industry. 

The manufacturing industry has grown no more than 1% from 2010 to 2018. Manufacturing jobs are usually low skills mass jobs that absorb a large portion of employable young people. As such, the lack of traction in the manufacturing sector has added to the employment woes that the country faces. 

While the manufacturing sector has not shown significant growth, the financial sector has shown considerable improvement. However, this sector is primarily a high-skill industry and cannot cater to meaningful employment.

This is given the fact that the bulk of this unemployed group consists of medium to low skilled employees. 

The employment statistics released by the countries statistics agency remained bleak. 

Statistics South Africa reported that the unemployment rate was at 32.5% in the last quarter of 2020. This means that up to 7.2 million people were out of employment. This figure was higher than the 30.8% reported in the second quarter of last year.

What are the leading causes of unemployment in South Africa? 

The country’s background and apartheid-induced inequality have created a legacy system of inequality. To date, black people in the country face an unemployment rate quadruple that of their white counterparts.

This can in part be attributed to the country’s legacy of apartheid that created a system of inequality that excluded black people from the education system. This gave rise to a perpetual vicious cycle in which this class of people has not been adequately reintegrated into the quality education segment. 

The inequality can also be in part a direct result of a failure to address the systemic issues of inequality plaguing the country. Some of the structural challenges include the high university fees, for example. The fee structure excludes a sizeable chunk of the population from receiving higher education. 

As the levels of education decrease, the unemployment levels rise significantly. 

Like the rest of Africa, South Africa also has a very young population. As such, more and more people flock into the labor market, which has no capacity to absorb large numbers. Coupled with the low education levels, this creates a large unskilled labor pool. 

Another factor contributing to unemployment is trade unionism. South Africa has an active trade union culture. Lobbying for higher wages, especially in an economy facing slow growth levels, may reduce new employment levels. 

It is important to note that reports have indicated some waves of xenophobic attacks on foreign nationals working within South Africa’s borders. It has been reported that some of these attacks have been linked to the dire unemployment situation, which has seen locals blame foreign nationals for taking their jobs. However, this situation wanes investor confidence even further, indirectly contributing to increased unemployment. 

How can stakeholders improve employment levels? 

An attempt to solve the urgent problem of unemployment involves addressing the education system. An adequately funded education system accessible to all regardless of background will help improve the young disadvantaged children’s skills.

Roping in private education institutions that provide high-quality, low-cost education, as is the case with institutions like Bridge International Schools in East Africa, can improve quality education. 

Further opening up the economy to encourage entrepreneurship through access to funding, government support, and promoting entrepreneurship within the education system may help open up the economy to allow for economic growth sufficient to cater to the ballooning population levels. 

An all stakeholder approach to addressing chronic inequality will help focus further towards improving equality as defined by socio-economic status to help open up access to opportunities. 

The fragile state of the economy

Going forward, there is a need to adapt to the new normal while seeking solutions to address the fragile state of the economy. According to the Bureau of Economic Research, the economy remains weak, as evidenced by a drop in business confidence. As businesses battle with the effects of covid 19, including dwindling demand, operational challenges, they continue to struggle to operate viably. 

As if to pour paraffin on an already burning situation, the looming threat of the coronavirus remains on the horizon. There has been a slow rollout of the vaccines, which has led to fear that gatherings and movement over the Easter season may become super-spreaders of the virus. The result would be a rise in the infection rate that may force the government’s hand to tighten lockdown restrictions once again. 

The start and stop cycle that businesses find themselves stuck in is of significant concern. The lack of certainty not only plummets investor confidence but also contributes to the unemployment issues. As long as businesses cannot find their footing, they remain hardpressed and can not create the employment level necessary to absorb the growing numbers of unemployed South Africans. 

In conclusion, the South African unemployment rate remains high. In the midst of the covid-19 pandemic, South Africa remains one of the continent’s highest affected countries and continues to grapple with finding solutions. 

The economy remains volatile. In unprecedented times like these, the unemployment issues in South Africa remain highly problematic. 

Read also: Unemployed and underprivileged hit hardest by S.Africa’s declining GDP

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Evelyn is a finance and business content writer with a passion for business news in Africa. Her expertise is in analyzing African equities and telling the truth when it comes to doing business on the continent!

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Home » News » South Africa » Politics

By Siyanda Ndlovu

4 minute read

16 Feb 2022

‘Unemployment, state of SA’s economy gives me sleepless nights’ – Ramaphosa

'it concerns me a great deal," the president says..

President Cyril Ramaphosa says unemployment and the poor state of South Africa’s economy is giving him “a torrid time”.

Ramaphosa said this in a Q&A session with journalists on Wednesday just after responding to the opposition’s State of the Nation Address (Sona) debate.

“What keeps me awake at night, and I am seriously kept awake, it is the state of our economy that keeps me awake, state of unemployment. It is very difficult to countenance 11 million people out of work who are not economically engaged in any activity.

“That is enough to keep me awake at night and it concerns me a great deal,” the president said.

Ramaphosa’s Sona last week was largely focused on the measures the government was taking to enable faster economic growth and the creation of employment.

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He said that this was because “fixing the economy is our most pressing challenge at this moment, and is essential to progress in almost every other area of life.

“Our focus on the economy does not, however, diminish the importance of the many other areas of government’s work.

“Many of these issues have been raised in the debate and will be dealt with in greater detail in upcoming budget votes and public engagements by ministers.”

While the Sona focused on growth and employment, millions of South Africans face the immediate challenge of feeding themselves and their families.

It is estimated that food poverty affects some 5.5 million households.

Gatvol South Africans slate Sona on social media

Ramaphosa said that without monthly grants for children, the elderly and persons with disabilities, many people in South Africa would face destitution.

“We know that grants have provided an effective system for income redistribution and poverty alleviation, in a society with unacceptable levels of inequality.

“Given the scale of unemployment and the impact of the pandemic, the interventions we are undertaking to create jobs will take many years to reach all 11 million South Africans who are unemployed.”

He said this were some among other reasons that the government took a decision to extend the R350 Covid-19 grant to March next year.

READ MORE: Ramaphosa’s Sona is not a blueprint but a wish list, says Buthelezi

“We are extending for another year precisely to reach these people and to stave off hunger. We are doing this within a fiscal environment that has been badly worsened by the pandemic.

“We need to do so while making sure that we do not further weaken our macroeconomic position and that we do not allow our debt service costs to further crowd out social spending.

“As a country, we nevertheless need to fill the gap in social protection to achieve a minimum level of support for those who cannot find work.”

Ramaphosa said that finding a sustainable, affordable and effective solution must be one of the central pillars of the renewed social compact that the government has undertaken to build.

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The State of Youth Unemployment in South Africa

Subscribe to africa in focus, aalia cassim and ac aalia cassim researcher, development policy research unit, university of cape town morné oosthuizen mo morné oosthuizen deputy director, development policy research unit.

August 15, 2014

• 13 min read

Youth unemployment has been inordinately high for many years in South Africa and is one of the country’s major socio-economic challenges. [1] Cross-country comparisons regularly affirm that South Africa’s unemployment rates are among the highest in the world. In 2013, the youth unemployment rate was 63 percent of the youth labor force (3.2 million individuals) according to the expanded definition of unemployment, which includes as unemployed those who are not actively looking for a job (i.e., the non-searching unemployed, or “discouraged work-seekers”). Youth unemployment is high, even in comparison with South Africa’s very high average unemployment rate of 34 percent. (By international comparison, while the ratio of youth to adult unemployment is fairly similar for other countries that are economically comparable to South Africa, the overall unemployment rate is far higher than in other emerging markets.) [2] Of the 10.2 million individuals aged between 15 to 24 years, one-third are not in employment, [3] education or training (and are often referred to as “NEETs”). Roughly 30 percent of male youth and 36 percent of female youth are NEETs, disconnected from both the labor market and opportunities that promote future employability.

Unemployed youth are characterized by their lack of employability resulting from a range of socio-economic factors. They often have low levels of education, have dropped out of school and invariably do not have the literacy, numeracy and communication skills needed in the labor market. They also have little work experience, which is a particularly undesirable characteristic for employers. These young people lack strong networks or social capital that allow them to source job opportunities, and tend not to have sufficient financial resources to enable mobility to areas where there is demand for labor. Of those who do have resources available as a result of their family support or network, they often have unrealistically high reservation wages, thereby resulting in relatively long periods of unsuccessful searching (Mlatsheni, 2007; Von Fintel and Black, 2007; Rankin and Roberts, 2011; Roberts, 2011). These socio-economic factors have resulted in a gap between productivity and entry-level wages for young workers, which is a constraint on job creation.

Persistently high unemployment suggests a lack of effective policy interventions. To date, policies that have been implemented have largely been supply-side initiatives aimed at the structural causes of youth unemployment. These include targeting the formal education system, post-school training, public employment and deployment programs, entrepreneurship interventions and an attempt at job placement programs. From the demand side, an employment subsidy has been recently proposed by the National Treasury to incentivize employers to hire young people.

Supply-Side Policies Targeting Unemployed Youth

Challenges within the South African education system are key structural issues underlying youth unemployment. In short, school-leavers do not exit the system with the requisite skills demanded by the labor market. For this reason, a number of funding and policy interventions are aimed at improving the education system such that it would raise youth employment prospects. In the National Treasury’s budget for the 2013/14 fiscal year, education spending increased to 232.5 billion rand (R) ($21.8 billion), targeting infrastructure, services and the backlog in numeracy and literacy skills. However, there are large cohorts of young people that have already been impacted by weaknesses in the education system. This group of early school-leavers, dropouts and unemployed high school diploma-holders requires interventions tailored to their particular needs and characteristics if they are to be fully able to participate in the economy.

A number of skills and training programs have been set up through various publicly funded technical and vocational education and training (TVET) institutions with the aim of facilitating entry into the labor market. These institutions—known in South Africa as further education and training colleges (FET)—have been unable to ramp up capacity and provide the types of training required by the economy. TVET institutions primarily provide vocational education programs, but these do not necessarily meet the skills—such as completing a school qualification or training in a particular non-vocational skill—demanded by youth. TVET institutions are also not always easily accessible in terms of location or financing, as there seems to be less financial support than is available for tertiary education. Furthermore, partnerships between TVET institutions (and other educational institutions) and employers are weak, demonstrated by the falling number of apprenticeships [4] offered in recent years after graduation.

The trajectory of labor demand in the South African economy favors skilled workers and, in light of the limited job opportunities available for low skilled workers, the government has implemented publicly funded programs that offer (i) employment in the provision of essential basic services to vulnerable South Africans; and (ii) deployment in programs that can provide income while additional skills are developed, thereby improving future employability .

The Community Works Program (CWP) was rolled out in 2008 and is designed as an employment safety net whereby a person’s existing livelihood is supplemented by offering a basic level of income through work. The program is a direct replica model of India’s Mahatma Gandhi National Rural Employment Guarantee Act (NREGA) program. This program has been used in the poorest communities and complements the social grant system. Communities play a central role in determining the types of work created through this program by deciding what activities would benefit them most. This program was extended to the Extended Public Works Program (EPWP). While these programs are not geared directly to youth employment, the EPWP reported that 57 percent of CWP participants in 2010/11 were under the age of 35 years (Department of Cooperative Governance, 2011:2). [5] However, these programs have been found to be less attractive to youth because they are not tailored to youth aspirations. Further, this type of work experience, which includes repairing community or school infrastructure, creating food gardens or home-based care, often does not lead to better paying jobs in the labor market, particularly those in urban areas.

Public deployment programs have only been implemented in South Africa to a limited extent through the National Youth Development Agency (NYDA), which targets unemployed youth and the unskilled. The NYDA ran a 12-month program that trained young people, providing them with qualification credits in fields, such as construction or enterprise development, where labor demand was stronger. While the NYDA annual report presents evidence of meeting their targets for the 2012/13 financial year, these targets were set particularly low: For example, they set a target of 800 job placements (just over 3,000 were actually created).

The National Rural Youth Service Corps, targeting rural youth, was implemented in September 2010. The intervention comprised a comprehensive two-year skills and incubation program after which participants would be involved in community development projects and be paid by government for their services. Training was conducted in numeracy, literacy, construction and entrepreneurship skills relevant to community development. This, it was hoped, would stimulate the rural economy. While this project was seen to be somewhat successful, there was an oversight on the part of the program coordinators who underestimated the amount of training required for youth to actually take on the community projects. The project will, however, continue to run into its second phase in the near future. Future iterations of this program should work toward scaling up the training that facilitated employment in the previous round.  

There have also been policy attempts at targeting youth entrepreneurship. The NYDA in particular plays a role in funding and facilitating youth cooperatives and provides training and support to youth entrepreneurs. These services are, however, not well targeted with very few young people accessing the services offered . Often interventions such as these are not pitched at the correct level or are offered to a community that does not demand these skills.

Apart from programs targeted specifically at young people, unemployed youth also benefit from general programs, given that they constitute the majority of the unemployed. One such example is the system of sector education and training authorities (SETA), which play a pivotal role in skills development in South Africa. Of particular relevance to young people is the learnership program, which allows the achievement of a nationally recognized qualification through a combination of structured learning and practical work experience. Learnerships involve individuals being placed within workplaces and are open to both students and the unemployed. Another example of a general program that benefits youth employment is the Department of Trade and Industry’s small business support programs.

The Department of Labor also aims to create an enabling environment for job creation through regulation. The Employment Services Act was passed in April 2014. The purpose of this legislation is essentially to promote employment, to improve the prospects of those looking for work by training and to facilitate job matching. In terms of youth, it aims to provide specialized services to access work with government requiring registration of job seekers as well as job vacancies and other placement opportunities and acting as an intermediary. Given very high cellular telephony penetration rates in the South African market, there seems to be extensive scope to explore available technologies to improve the accessibility—and, indeed, the evaluation—of such services.

South Africa’s Jobs Fund represents a significant intervention aimed at reducing unemployment generally. Launched in mid-2011 by the South African minister of finance in response to the loss of more than one million jobs in the wake of the global recession, this is the world’s largest challenge fund, with projects selected for funding through competitive processes with particular criteria relating to eligibility and impact. The fund provides public funding in four areas: enterprise development, infrastructure investment, support for job seekers and institutional capacity. The fund has created nearly 100,000 jobs at a cost of R63,000 (roughly $6,300) per job.

Demand-Side Policies Targeting Employers

In 2011, the National Treasury suggested that the high rate of youth unemployment was a result of insufficient demand within the labor market to meet the rising number of young job seekers entering each year. It is within this context of weak labor demand that the option of a youth employment subsidy has been proposed. Employment subsidies are appealing because they target job creation instead of indirectly incentivizing the absorption of youth into the labor market. They also offset the cost of employment and training of new workers for employers. Treasury is in favor of an employment subsidy as it operates through the tax system and can rapidly reach a scale that cannot necessarily be achieved through employment or deployment programs such as those discussed above. In terms of the proposal, employers who employ youth will be subsidized for two years, with a larger proportion of wages being subsidized in the first year.

Piloting of this type of initiative has yielded favorable results. Commissioned by National Treasury, the African Microeconomic Research Umbrella at the University of the Witwatersrand ran a pilot study with 4,000 participants from three provinces (Gauteng, Kwazulu-Natal and Limpopo). In terms of the experiment, half of the sample was given vouchers to cover up to 50 percent of their wage for six months and the rest of the sample group was given nothing. The key finding was that job seekers that had received vouchers showed a higher inclination to stay in a job, even after two years, thereby showing the positive impact of the voucher even after it had lapsed.

Unemployed youth differ widely in terms of demographic, locational and educational attainment characteristics, and it is a concern that the subsidy may not be inclusive in terms of targeting the youth (Yu, 2011: 16). Broadly, though, there are two key youth subgroups: First, those who are better off, have more work experience and are normally actively looking for a job; and, second, those who are located in poorer provinces, are less mobile, are more likely to have a lower level of education and who have no work experience. The latter group includes normally discouraged work seekers. There is concern as to whether the subsidy will actually encourage discouraged work seekers to actively look for a job and, furthermore, and whether this group would become any more attractive to employers. This policy will obviously have to work in conjunction with sector employment projects, training institutions and financial support for further education programs to have a wider scope in terms of the youth that will be targeted.

The South African government has implemented a number of initiatives aimed at creating jobs and reducing unemployment, as well as ameliorating the impact of high unemployment on individuals and their households. The past 20 years has seen a significant expansion of the existing social grants system that, while not specifically targeting the unemployed, has helped reduce poverty among households impacted by unemployment. Thus, by mid-2013, nearly 16.2 million social grants of various types were being paid by government on a monthly basis, equivalent to over 30 percent of the country’s population. Further, there is some evidence that social grants have helped facilitate job search among unemployed household members.

There is general recognition, though, that government alone cannot resolve the unemployment crisis. As a result, there are now a significant number of ongoing interventions spearheaded by organizations in the non-governmental and non-profit spheres. These interventions range from small business support, to youth training, to the provision of bursaries for education and training, to facilitating the matching process between job seekers and employers.

In summary, there are certainly concerns around South Africa’s youth unemployment policy interventions in terms of design, targeting and ability to adequately address the needs of young labor market entrants as well as employers. Perhaps the key constraint in generating impact has been scalability, as many interventions have been too small or too localized to impact aggregate unemployment rates. An important lesson is that supply-side initiatives addressing structural issues are insufficient on their own to generate sufficient new jobs. Instead, these interventions should interface closely with demand-side incentive programs. There are, also, political economy constraints that need to be resolved. For example, the generalized lack of jobs results in resistance to certain interventions on the part of those who view them as a zero-sum game between the youth and older workers.

Note : Morné Oosthuizen is the deputy director of the Development Policy Research Unit (DPRU) at the University of Cape Town. DPRU is one of the Brookings Africa Growth Initiative’s six local think tank partners based in Africa. This blog reflects the views of the author only and does not reflect the views of the Africa Growth Initiative.

[1] Youth are defined by the International Labor Organization as individuals between the ages of 15 to 24 years. It is important to note, however, that South Africa utilizes a broader definition, covering individuals between the ages of 15 and 34 years, and its youth-targeting policies focus on this broader age group. However, for the sake of comparison, we use the international definition unless otherwise stated.

[2] The National Treasury (2011) used the ILO and QLFS 2010 to make this assertion for the 18-29 age cohort. The ratio of youth to adult unemployment in Africa is about 2.5 (i.e., the youth unemployment rate is two and half times larger than the adult unemployment rate), and cross-country comparisons indicate that this is broadly in line with other emerging markets such as Morocco, Mexico and Chile. South Africa was an outlier in terms of the magnitude of the unemployment rate. It was just under 40 percent while other emerging markets varied between 10 percent and 30 percent.

[3] Youths “not in employment” are not considered members of the youth labor force because they are not economically active.

[4] Between 2008 and 2009, the number of apprentices declined 25 percent from 12,000 to 9,000 placements (Janse et al. 2012:45).

[5] Department of Cooperative Governance (2011). Communities at Work: Community Work Program 2010/2011 . Pretoria: Department of Cooperative Governance.

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Employment and the economics of job creation Speech for the 26th Annual Labour Law Conference: Speech by Reserve Bank Governor Gill Marcus South African Reserve Bank

Dr Erich Fromm, in his 1976 book “To have or to be?” provides an analysis of the crisis of modern civilisation and, when addressing the features of a new society, wrote: “The first requirement in the possible creation of the new society is to be aware of the almost insurmountable difficulties that such an attempt must face …

Those who have not given up hope can succeed only if they are hard-headed realists, shed all illusions and fully appreciate the difficulties … (the new society) would have to create work conditions and a general spirit in which not material gain but other, psychic satisfactions are effective motivations …"

Akerlof and Shiller, in their book “Animal Spirits” (2009) write: “We are facing the same problem today that we faced in the latter years of the Great Depression – business today is inhibited by uncertainty about the future, about the tolerance of an angry public, about a disaffected labour force and about what further government actions may be coming … We identified five psychological factors that we thought were of particular importance. They are confidence, fairness, corruption and bad faith, money illusion and stories …”

It is almost twenty years into our young democracy, the past six of which have been seriously impacted by a global financial crisis to which there is no end in sight. And one of the hardest hitting impacts has been on ordinary people from all walks of life, who have seen their hopes for the future evaporate; millions will never work again; others will never know the dignity and independence that work brings. As the above quotes reflect, creating an inclusive society requires courage, foresight and the ability to make very tough choices. We also better understand our circumstances and challenges through stories, and it is imperative that we both tell and hear the many varied South African stories that make up the complex fabric of our society.

Each year, the World Bank publishes its World Development Report covering a particular theme of development. This year, it has titled its report “Jobs”. This simple title says much about the most pressing economic issue facing the world today. The IMF, too, has released a substantive paper on Employment and Growth and recently the International Labour Organisation released its World of Work report with the theme of “Repairing the Social and Economic Fabric”. In recognition of the scale of the employment crisis and its impact on both social cohesion and longer term growth, several other global institutions and economists are focusing their attention on employment, seeking ways to tackle unemployment and underemployment.

These discussions on employment occur in a global context where unemployment has increased sharply since the onset of the financial crisis. Of great concern is the fact that the number of young people who are unemployed, and the length of time that people remain unemployed, are rising. South Africa has had an unemployment crisis for the better part of three decades. A few years ago South Africa was an outlier with an unemployment rate of around 25 percent.

Today there are several countries in the periphery of Europe with unemployment rates at least as high as ours – not that this is any reason for complacency or comfort. The International Labour Organisation estimates that there are about 200 million unemployed people in the world today. This figure excludes the millions more who are either underemployed or are discouraged from seeking employment. The ILO estimates that the number of unemployed people in advanced economies is likely to remain above the pre-crisis level up to at least 2017, a full decade after the crisis first began. In South Africa, total employment is still about 400 000 below the peak reached in in 2008.

The unemployment crisis represents a massive waste of lives and resources. It has profound social implications and its effects will be with us for decades to come. Economists refer to the term hysteresis, which in this context describes the loss of skills and productivity when a person has been out of the workforce for a long period of time, thereby lowering future potential growth. Reducing unemployment on a sustainable basis is arguably the single most important economic objective at the present moment. In part, creating jobs is about raising the level of economic growth. However, it is also about addressing the structural factors that limit employment growth.

My address today will try to give you a sense of how central banks think about employment and how they factor employment issues into their reaction function. I will also explore broader structural and cyclical factors relating to employment. Before concluding, I will briefly make some observations about the future of work and the likely impact of technological change.

The policies of central banks are not often associated directly with employment creation. However, monetary and financial sector policies have a role to play in at least two respects. Firstly, the conventional view is that monetary policy can affect cyclical employment, but it cannot determine the longer run potential output of the economy. This is the basis for countercyclical monetary policy. However, in a recent paper, Phillipe Aghion and Enisse Kharoubbi, argue that better macroeconomic stability can actually contribute towards higher potential growth and that the absence of macroeconomic stability has a profound impact on employment rates.

Our task as monetary authorities is to provide a stable environment for balanced and sustainable economic growth to occur; to ensure that investors can take a longer term perspective and that the value of earnings and savings are not eroded by inflation. Price stability is an important contribution to this environment because inflation is a regressive tax, impacting on the earnings and wealth of poor people far more than on the rich, who often have the means to protect themselves. In South Africa, high inflation contributed significantly to widening inequality in the 1970s and 1980s.

Secondly, central banks also play an important role as regulators of the financial sector in a manner that contributes to the efficient allocation of resources in the economy, to prevent financial crises from occurring and to ensure that that money and credit is flowing to those who seek it. A key lesson from the financial crisis is that when the financial sector implodes, when confidence in the banking sector evaporates, the real economy is seriously affected because if money and credit are unavailable, the economy grinds to a halt. And one of the consequences is that people lose their jobs.

One of the measures taken as part of a global move to create a safer and more accountable financial sector has been a series of regulatory reforms, including what is known as Basel III, which creates a framework for regulating the conduct and risk-taking of banks. South Africa sees these measures as critically important, and is in the process of introducing the so-called twin peaks model to regulate the financial sector in a more holistic manner.

Beyond these important contributions to the broader economic environment, which are essential for job creation, central banks do not have the policy instruments to create jobs directly. Central banks also do not usually have the institutional authority or tools to undertake the structural reforms required to ensure that an economy grows faster or that unemployment is reduced at a faster pace. Furthermore, the room for central banks to direct credit to one sector over another or to one firm over another is limited. Fiscal policy, industrial policy and quasi-fiscal institutions such as development finance institutions are more suited to implementing such policies, which also fall within their areas of responsibility.

The on-going global crisis has, since inception, mutated from a sub-prime crisis to a systemic banking crisis, a fiscal deficit and sovereign debt crisis to one that has seen countries and regions move in and out of recessions. Some measures taken to address these issues, including in some instances the introduction of extreme fiscal austerity policies, exacerbated the adverse effects of the crisis on unemployment. The latest mutation appears to be one that has impacted on emerging market economies, which are experiencing significant capital outflows, depreciating currencies, slowing growth and rising inflation. All of this impacts on local economies and jobs.

Some of the rise in global unemployment is due to cyclical factors, including the austerity measures introduced following the crisis, and part of the rise is due to structural changes to the economy. It is often difficult to differentiate one from the other, especially when unemployment has been so high for so long. In the South African context, a relatively small proportion of our unemployment is cyclical; the bulk of it is structural with deep and long historical underpinnings.

Drawing on reports by the IMF, World Bank, ILO and other institutions, several themes emerge. The key ones include:

• What is the appropriate fiscal and monetary response to unemployment or more generally to the present state of poor economic growth?
• What labour market reforms are required to support economic efficiency and productivity growth?
• What labour market and other social policies can protect workers?
• What other microeconomic or structural reforms are needed to raise the level of growth and employment going forward?

There is general support for strong fiscal and monetary responses to cyclical downturns. Countercyclical monetary and fiscal policy can stimulate investment and employment when the private sector and households are less inclined to spend or to invest. On the fiscal side, there is strong support for investment in infrastructure and for subsidies to firms to train people rather than retrench workers. There is also increasing evidence that greater public support for research and development can contribute towards economic development and productivity growth, especially at a time when private firms are spending less on investment.

Monetary policy in much of the globe has been supportive of credit extension and consumption. In most countries, including our own, interest rates are at historic lows and have been for some time. In some jurisdictions, central bank purchases of a broader range of assets, also known as quantitative easing, has provided further stimulus, enabling banks to improve their balance sheets. In general, central banks in advanced countries have tried to assure economic participants that interest rates will be kept low for some time in order to encourage investment. But there are limits to what monetary policy can achieve in this respect. As indicated earlier, monetary policy can only provide short to medium term relief and is not a substitute for necessary structural reforms.

On both the fiscal and monetary fronts there are debates about the sustainability of these measures and the debate has shifted to the timing of the normalisation of such unconventional policies, and a concern about the possible unintended consequences as has been seen over the past few weeks.

Labour market reforms that enable more efficient movement of workers from one sector to another are necessary because they help economies adjust to changing circumstances. They are also controversial because they reduce job security. Drawing on the work of the Spence Commission (the Growth Commission), policymakers are focusing more on protecting workers than on protecting jobs. This is a subtle distinction, but a significant one. Policies such as unemployment insurance, training vouchers and placement assistance can help workers who have lost their jobs find alternative opportunities. Policies that limit the ability to downsize or restructure are seen as inefficient and are being adjusted.

Some countries have introduced innovative programmes to enable firms to keep people on their payroll, albeit at lower wages, instead of retrenching workers. These programmes are generally tied to training and re-skilling of workers. The most successful of these programmes is in Germany where a significant proportion of the workforce chose lower pay and the chance to be retrained rather than retrenchment. Many countries, including developed ones, have public employment programmes not too dissimilar to our public works programme. Other active labour market policies include matching activities for both people and firms. Several jurisdictions offer tax credits to employers to take on specific categories of workers.

There is also recognition that structural reforms aimed at improving economic efficiency are needed to raise the level of employment. These policies include tougher anti-competition policies and microeconomic reforms aimed at lowering costs in key network industries.

Education, training and the retraining of workers are essential to maintain long-run competitiveness and ensure higher levels of employment. After declining for decades, many advanced economies are spending more on education and training since the financial crisis, despite significant pressure to reduce public spending.

South Africa’s high level of unemployment is not a new phenomenon. According to Haroon Bhorat, a labour market economist at UCT, in 1970 the number of African people in formal employment was 5.3 million. This number increased in the 1970s and early 1980s but by 1995, 25 years later, it was exactly the same at 5.3 million.

This is despite the working age population almost doubling. While we cannot simply look backwards and blame our past, we also cannot simply wipe away its terrible and enduring legacy. The deep structural features of apartheid - in the form of poor quality education for black people, job reservation, curbs on trading and owning businesses, forced removals, land dispossession, dormitory townships and the homeland system - have all contributed to the situation where we have one of the highest levels of inequality in the world and over a third of adults are out of work.

Since 1994, we have made steady progress in creating jobs, but clearly the rate of job creation has been too low to absorb the bulk of people seeking work. Sound macroeconomic performance combined with higher growth has contributed to rising employment since 1995. The problem has been that the increase in the labour force has outpaced the number of jobs created. South Africa’s official unemployment rate increased from 17.6 percent in 1996 to 30.4 percent in 2002, before declining to 22 percent in 2007.

The legacy of apartheid has clearly resulted in a high level of unemployment, but growth since 1994 has not been as high as we would like. The rate at which an economy grows consistently is critical. While we all recognise that jobs are not automatically created when countries grow, we do know that if a country is not growing then it is extremely difficult to create new jobs, or even sustain existing ones. Government has frequently mentioned the desire to grow the economy at 7 percent a year. It takes decades for countries to make the transition from poor to advanced economies.

Michael Spence, when examining this matter in his book “The Next Convergence”, says that “at a 7 percent rate of growth income doubles every decade, and that is very fast ... And even at such very high growth rates it takes well over half a century to make the full transition. What matters is sustained growth over a long period of time. Little growth spurts followed by stagnation simply lowers the average growth and prolongs the process.” It is in this context that we need to frankly assess our long term growth average, and our current growth rates, as while we are creating new jobs, they are not sufficient to absorb new entrants into the labour market, and therefore unemployment continues to rise.

We also have to acknowledge that there remain deep structural weaknesses in our economy that prevent faster growth and higher labour absorption. These structural weaknesses, notwithstanding the legacy issues mentioned earlier, also include uncompetitive product markets, low levels of fixed capital investment, a low savings rate, inadequate progress in improving education and training and poor public services.

Of particular concern has been the fact that the two sectors in the economy most intensive in low skilled workers, mining and agriculture, have shed jobs for much of the past twenty years. While there has been some job creation in low skill sectors such as the private security industry and the retail sector, in general most jobs have been created in skills-intensive sectors, locking out low skilled workers. Given the shortage of skilled workers, this trend has also pushed up the salaries of skilled people, contributing to rising inequality.

This shift to more skills-intensive jobs is not a uniquely South African phenomenon. Globally, work has become more skills-intensive and the rates of return to education have been rising in most countries (IMF, 2013), meaning that skilled workers are capturing a larger and larger share of wages in the economy. This trend, referred to as skills-biased technological change, is also impacted by the introduction of China into the global trading system. Low skilled work has been outsourced to lower cost economies. When countries have highly skilled populations, this trend is a positive one for both productivity and employment. When workforces are insufficiently skilled to move up the value chain, then these workers get left behind. Even some developed countries, such as the US, are confronted by this problem.

One of the most controversial aspects of post-apartheid policies has been the labour regime and the institutional structure of the labour market. The labour regime we have has sound intentions. Its aims are to balance the power of employers and employees following a history where workers, black workers in particular, were exploited and subjected to arbitrary dismissal. The labour regime aimed to reduce tensions in the workplace by setting up complex quasi-legal dispute resolution mechanisms. Policy has also sought to broaden access to unemployment insurance, health insurance, workmen’s compensation, maternity leave as well as training opportunities through the establishment of sectoral education and training authorities.

Following the enactment of the Labour Relations Act, the number of days lost to strike action fell sharply with about one million strike days a year on average from 1996 to 2007. Since 2007 however, the number of strike days lost have increased sharply and strike activity has also become more violent. More recently, there has been a sharp increase in illegal or un-procedural strikes. Today, many labour intensive sectors are characterised by high levels of tension which are not conducive to investment, job security or employment creation.

In other respects too, the labour regime has not lived up to expectations. We have not seen the dynamic growth of small and medium sized firms as one would have expected in a country at the level of development of South Africa. While collective bargaining has contributed to labour peace, it has also favoured big firms at the expense of smaller ones. New labour entrants also find it difficult to break into the labour market. While in general salaries are not high relative to other countries with a similar level of productivity, starting salaries are higher than other countries, discouraging employers from hiring inexperienced workers (OECD, 2010). Firing costs, especially for smaller firms, are also high by international standards (WEF, 2012).

A major feature of the labour market regime has been the inability to more closely link pay to productivity growth. This was not what was intended. When the Labour Relations Act of 1996 was passed, the intention was for collective agreements to serve as framework agreements, covering minimum pay and basic benefits. The intention was that within these framework agreements, firms would negotiate firm-specific agreements linking salary increases to productivity gains. In practice, this is the exception rather than the rule. To introduce greater links to performance one does not have to change the law. Within the existing legal framework such agreements are possible.

South Africa’s youth unemployment rate is particularly high, now above 50 percent. Programmes to encourage firms to hire young people have so far not yielded the desired results. Our view is that it is possible to incentivise firms to hire younger people without the threat of displacing more experienced workers. Several OECD and developing countries have some variant of incentive, including tax breaks, to firms to hire inexperienced workers and young people while protecting the existing workforce and older workers.

Given the scale of unemployment in South Africa and the fact that most of the unemployed lack the skills to fit into most of the skills-intensive parts of the economy, it is critical that we focus on growing labour intensive sectors, including mining and agriculture. It is also critical that government expands and strengthens the quality of its public services, including the social wage, to enable low skilled workers to live meaningful lives. This requires an implicit understanding that wages on their own may not meet the desired living standards for newer workers, a controversial question given the high levels of inequality in our society.

While South Africa has made praiseworthy progress in expanding access to early childhood education, school education, further education and training and university education, the quality of outcomes in the education system remains below international averages. Education provides the single most-effective route to breaking the intergenerational cycle of poverty. Lack of education is also the greatest exclusion a person can experience. It is also critical to obtaining a job and to higher productivity. Given that the economy is short of skills, importing skilled workers can be a sensible strategy because of the multiplier effects for low skilled employment. It is estimated that for each high skilled immigrant that comes into the country, between four and eight low skilled jobs are created.

South Africa is faced with a difficult set of trade-offs. In general, countries get rich by moving up the value chain, by becoming more skills-intensive. South Africa lacks the skills to compete with advanced economies such as Germany and the US. On the other hand, our cost structure does not allow us to compete with poorer economies. South Africa has to therefore adopt a dual strategy of promoting growth in advanced sectors that can compete globally while also creating jobs in lower productivity sectors.

Both legs of this strategy should focus on the need to raise exports in general which is the only realistic strategy to address our inequality problem on a sustainable basis. While mining will remain critical to our development prospects, the economy has to diversify to be able to create more jobs going forward. Since the industrial revolution, there have been many debates about the impact of technology on employment.

The general consensus is that while technology may displace workers in some firms or industries, the productivity gains and resulting welfare benefits imply that new industries emerge and overall employment continues to rise. There could of course be huge inter-temporal factors that complicate the picture with long delays and lags between the destruction of a job in one sector and the emergence of new jobs in other sectors. There are also distributional effects which have to be considered.

Well-paying jobs in the auto industry in the US, for example, may be destroyed through outsourcing or mechanisation while the jobs created in the growing services sector may offer lower pay. Furthermore, the returns that go to the developers and designers of technology now far exceed the returns to the people who assemble the products or even the people who extract the raw materials for the product.

These distributional challenges arise in a global context. With a rising share of profits going to the design companies who are generally located in advanced economies, less of the value addition occurs in poorer countries. To put it differently, more of the value of the product accrues from the research, development, marketing, logistics and intelligence of the product than in any other part of the supply chain.

The pace of technological change appears to be accelerating exponentially. The internet, mobile telephony, networked computing and more recently artificial intelligence have implications for the world of work and for our lives that are difficult to comprehend. Joseph Stiglitz in his 2010 book Freefall, argues that the jobs lost in agriculture at the end of the 19th century contributed to lower aggregate demand, leading to the Great Depression.

This catastrophe was only resolved through the rise of manufacturing, initially prompted by the demands arising from the outbreak of Second World War. Is the unemployment we are witnessing today a result of a great dislocation of workers from manufacturing to services, or a replacement of workers – both skilled and unskilled - by artificial intelligence, or are there new work opportunities that are yet to be identified that could absorb the growing army of unemployed across the globe?

These trends pose complex questions for policymakers. Should we protect certain sectors, and if so, how? Does protecting certain sectors or firms weaken the ability of the economy to transform or to innovate? Again referring to the Growth Commission report, the preferred approach is to protect people through sensible welfare safety nets and retraining opportunities rather than protecting specific jobs. It also brings back into focus the role of the public sector not only as provider of public goods such as education and research and development but also as employer in labour intensive services such as health care, transport, crime prevention and education. Does this level of unemployment not require all of us to reconsider the role and responsibility of the state in filling the gaps in services to all citizens that the private sector is not adequately meeting?

South Africa and the world face difficult challenges in reviving economic growth and creating jobs. Sensible counter-cyclical policies combined with longer term structural reforms aimed at promoting growth, employment and a more equitable distribution of incomes are the way to navigate out of this crisis. For South Africa, there is also a need to improve the functioning of the labour market, to strengthen its institutions and to walk that careful balance between hard-won rights of workers and the need to promote inclusive growth through encouraging new entrants into the workplace.

From our perspective at the Reserve Bank, we will continue to contribute towards an environment conducive to creating jobs and encouraging long term investment. This implies a continued focus on price stability and the prevention of financial sector crises. It also implies policies aimed at reducing the volatility of the business cycle and of ensuring as little disruption to the macro-economy from external shocks as we can manage.

I leave you with a quote from the World Development Report on jobs: “In today’s global economy the world of work is rapidly evolving. Demographic shifts, technological progress, and the lasting effects of the international financial crisis are reshaping the employment landscape in countries around the world. Countries that successfully adapt to these changes and meet their jobs challenges can achieve dramatic gains in living standards, productivity growth, and more cohesive societies. Those that do not will miss out on the transformational effects of economic and social development.”

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Tackling youth unemployment: What works, what doesn't

Youth unemployment is one of South Africa’s most intractable challenges, made worse by COVID-19. Prior to the pandemic the unemployment rate (including people who had given up looking for work) was just under 70% for people aged 15 to 24 .

A year later the rate had increased to 74% – despite government investments. So it is crucial to understand what interventions are working. But how do we evaluate whether youth employment programmes are successful, particularly when unemployment is caused by the structure of the economy ?

The obvious answer, of course, is whether a programme results in a young person getting employed.

This is logical and easy to measure. It can easily be linked to the release of funding to programmes. And it allows for programmes to be compared. This was done in a systematic review of 113 programmes internationally .

However, as we have explored in several recent studies, there are a number of drawbacks to relying solely on job placement as an indicator of successful intervention. Doing so misses out on outcomes that are equally important, or more so, amid high structural unemployment.

Together, these studies show that job placement alone is an insufficient goal and measure of the success of youth employability programmes.

These lessons are particularly important in economies that have been severely affected by the COVID-19 pandemic, where youth employment recovery will take time.

Inadequate measure of success

We make this argument based on several studies. The first looked at long-term employment outcomes of 1,892 youth between 18 and 25 who participated in youth employability programmes over the period 2017-2018. These are programmes run by NGOs, business and the state. They typically include technical and soft skills training.

The proportion of participants who found jobs and stayed in them over time was just 28% – somewhat better than a matched sample from the quarterly labour force survey data , but still low. But we also found evidence that programmes had other important outcomes. These included a continued positive orientation to the labour market, and improved self-esteem and self-efficacy – important attributes for managing the protracted transition to work in a low growth economy.

The second involved analysis of the quarterly labour force survey and general household survey data to understand the nature of young people not in employment or in education and training. It found that while many such youth have never worked, a significant portion find themselves in and out of work without making much longer-term progress.

The third study draws together several qualitative studies conducted in the past 10 years. It shows that young people are frustrated by the constant cycle of finding and taking up training and employment opportunities, without making progress towards a longer-term career.

Together, these studies show that job placement alone is an insufficient goal and measure of the success of youth employability programmes. Four reasons for this argument emerge from these studies.

First, job placement says more about demand than supply. A young person’s ability to find a job doesn’t depend only on their skills but also on whether the labour market is creating sufficient demand for employees. No matter how well a programme trains and supports a young person, if there are limited jobs, young people are unlikely to be employed.

Second, if a programme is getting young people into jobs even though job numbers are not growing – as in South Africa – these placements may be at the expense of other work seekers.

Individual programmes can get people into jobs while the overall youth unemployment rate stays stagnant or rises. In the context of a rapidly contracting economy in the COVID-19 era , this is a particularly important argument against job placement as the only measure of a programme’s success.

Third, using this single indicator takes attention away from longer-term pathways towards sustainable livelihoods. Many jobs in South Africa, especially at entry level, are insecure, part time or casual. There’s a risk of disregarding whether a job is decent and has prospects for learning and career development.

Young people typically do not stay in jobs . This is either because the job is not a good fit or is for a short term only. Other barriers, such as transport costs, also account for why they are unable to stay in jobs.

Qualitative and quantitative evidence shows that young people find jobs that are typically short lived, before having to look again for their next placement. Policymakers should consider whether these short term experiences add up to something longer term – or there’s a risk of perpetuating the cycle of underemployment.

Finally, and perhaps most importantly, evaluating programmes on the basis of job placement alone underestimates the multidimensionality of poverty . Evidence repeatedly shows how many barriers and challenges young people face as they leave the education system and begin to find their way towards a job, and perhaps even a career.

Evidence repeatedly shows how many barriers and challenges young people face as they leave the education system and begin to find their way towards a job, and perhaps even a career.

These barriers are not only related to the labour market or education system. They also include issues such as food insecurity, income poverty, and care responsibilities , among others. Each of these limit the ability of young people to look for work.

These interrelated challenges influence young people’s ability to take up training or job opportunities.

Taken together, these challenges require far more intensive support than simply training and placing a young person in a job.

Alternative approaches

It is crucial that funders, policy makers, and programme developers invest in more intensive support that can help young people meet the challenges they face in seeking work. They must also insist on measures beyond job placement as indicators of success. International evidence bears this out. It shows that across 113 programmes reviewed, multidimensional programmes that seek to provide more comprehensive support to youth are more effective than those that offer training only. They are particularly successful when they target the most vulnerable youth.

Further, our research recognises the crucial contribution such programmes play in keeping young people connected to opportunities, and reducing social exclusion and social drift. This is when young people become increasingly disconnected from the labour market, training opportunities and positive social inclusion, which in turn can have negative consequences on mental health.

Given this evidence and the fact that South Africa is facing a stagnant economy for some time, it is crucial that funders, policy makers and those working on youth employment interventions evaluate and invest in programmes on the basis of their ability to keep young people positively oriented towards the labour market. The programmes should help improve their employability, even if the young participant is not yet able to find an actual job.

Outcome indicators that can more adequately measure these factors include enhancing job search resilience, promoting self-esteem and self-efficacy, and reducing discouragement .

There are ample reasons to move away from evaluating employability programmes on the basis of employment outcomes alone. Rather, a range of indicators should be used to track whether young people remain engaged, believe in themselves and keep trying to find a job. This, while developing the personal attributes that will make them attractive to future employers.

Each of these outcomes is more difficult to measure than a simple count of job placements. But it’s not impossible.

Lauren Graham, Associate professor at the Centre for Social Development in Africa, University of Johannesburg, University of Johannesburg; Ariane De Lannoy, Senior Researcher: Poverty and Inequality Initiative, Southern Africa Labour and Development Research Unit, University of Cape Town, and Leila Patel, Professor of Social Development Studies, University of Johannesburg.

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DA announces ground-breaking new economic policy to rescue South Africans from unemployment

26 apr 2024 in news.

Unemployment is the single greatest crisis facing South Africa.

The fact that over 70 out of every 100 young people aged between 18 and 24, as well as 42 out of every 100 work seekers overall, cannot find a job to feed their families and build a better future, is the original sin of the incumbent ANC government.

Even on the narrow definition of unemployment – which excludes those people who have given up on ever finding a job – the number of jobless South Africans of working age has increased from 20% in 1994 to nearly 33% today.

This unemployment crisis, created by the ANC, is a crime against the people of South Africa.

The DA is here today to tell the people of our country that it does not have to be this way.

South Africa can be rescued from the unemployment crisis that has robbed millions of citizens of the brighter future we all dreamed of in 1994.

We do not have to accept the scale of joblessness in South Africa, because it is not a natural phenomenon.

It is not normal.

Viewed in the global context, a 33% unemployment rate is not normal. It is abnormal.

A 70% youth unemployment rate is not normal. It is abnormal.

The fact that ten million people cannot find work in this country, is not the result of a force of nature.

That South Africa today has one of the highest unemployment rates in the entire world, is an entirely man-made disaster.

It is a disaster designed and executed at the hands of the men and women in the ANC.

It is because of the deliberate choices of the men and women inside the ANC, that 309 000 manufacturing jobs were destroyed over the past 16 years.

It is because of the deliberate choices of the people inside the ANC, that South Africa’s tax base has not only shrunk, but now also bears one of the highest tax burdens in the world – with a tax-to-GDP ratio of 25.5%.

It is because of the deliberate choices of the ANC, that we have been plunged into a fiscal crisis, where R1 out of every R5 collected from taxpayers is now used just to pay down our R5.2 trillion debt bill, leaving less money every year for investment in job-creating infrastructure.

And it is because of the deliberate choices of the ANC, that over 30 million citizens now live in desperate poverty.

However, the fact that the lack of jobs in this country is a man-made crisis, also means that the South African people have the power to fix this crisis.

It is because of human choices that we sit with one of the highest unemployment rates in the world today.

Which means that, through different choices, we have the power to turn the situation around.

I am proud to launch the DA’s new economic policy today.

This policy is built upon the simple yet fundamental truth that the wrong choices made by the wrong people have created our unemployment crisis, and that better choices made by the right people can solve this crisis.

Our plan to unleash enterprise, grow the economy and create jobs spells out what these better choices are, and confirms that the DA are the right people to rescue South African from our man-made unemployment disaster.

This is a historic moment for our party, and for South Africa.

This detailed policy, developed in consultation with some of the best economic thinkers in the world and built on global examples of best practice, presents the most compelling and exciting economic offer South Africans have seen in a generation.

It introduces a clean break from the destructive statist policies of the ANC that created our unemployment crisis, and sets South Africa down a new path to growth based on modern, pragmatic and fit-for-purpose policies.

At the DA’s national manifesto launch in February, I announced that our first and most important pledge in this election is to deliver two million new jobs, and to lay the foundation for a new, rapidly growing and modern economy.

The policy we launch today, shows why this is a credible, achievable and urgent pledge that a DA national government will deliver on.

It is all built on getting the right people into government, so that we can make better choices.

The policy sets out how we will improve the ease of doing business, which alone will unlock between 350 000 and 400 000 new jobs.

Through making better fiscal choices, we will generate another 350 000 to 450 000 new jobs.

Reforming labour policies through better choices, including our introduction of a new Youth Employment Opportunity Certificate, will unleash hundreds of thousands more jobs for young people.

Coupled with making better choices on collective bargaining to expand representation and exempt small, medium and micro enterprises from agreements they cannot afford, this will ignite the creation of a further 700 000 to 1 000 000 new jobs.

Add to this the better choices we will make on industrial policy, that will generate between 400 000 and 500 000 new jobs, as well as better choices on trade policy, which will add another 100 000 to 150 000 jobs.

Unlike other political parties that are thumb-sucking jobs promises, every single pledge contained in the DA’s economic policy is the product of thorough costing and cutting-edge research.

The DA knows exactly where we will create jobs, what choices we need to make, and what the trade-offs and costs are.

The policy we announce today, is an inflection point for our party.

For the DA, it signifies that we have fully ascended to the level required to govern a country.

After decades of growth through governing dozens of municipalities and a major province, of learning, and of internal reform, the DA steps up today more confident, more prepared and more determined than we have ever been to rescue the whole of South Africa from unemployment.

The adoption of this policy announces to the world that the DA has fully embraced the responsibility we have towards the people of South Africa to provide a credible alternative government that will solve the most urgent crises that plague our society.

And there is no crisis more urgent than unemployment, which we tackle head-on from today.

This policy is the signal of a DA that is mature, that knows the ANC is set to lose its majority in a little over a month’s time, and that is fully prepared to take over government as the anchor tenant in a new government.

We launch this policy today because the DA’s time has come, and because we are prepared to what will be demanded of us in national government.

But, more importantly, this policy is also an inflection point for South Africa.

Meticulously researched, it is built upon only the cold, hard facts of what works to grow business and employment all around the world.

With the election now a little more than a month away, the DA’s historic new economic policy provides voters with a detailed roadmap of how we will rescue South Africa from unemployment.

Every single voter who wants a brighter future, who wants to find a job in a growing economy, and who wants to put food on the table, will see in this plan the most riveting and hopeful opportunity in thirty years.

In this election, a vote for the DA is a vote for a strong, experienced party with a proven track record of delivery, that will carry this plan into coalition negotiations and the formation of a new national government to deliver two million jobs over the next five years – and to lay the foundation for a future where every single South African can find work to build a better life.

As in life, politics is about choices.

With the launch of this policy today, the DA announces that we have made the courageous choice to step up like we have never done before, to address the single most urgent crisis facing the future of South Africa.

We now call upon the people of South Africa to equally act with boldness in making a new choice for a better future, by voting the DA into government on 29 May.

For thirty years, we have elected the wrong people, who have made the wrong choices for our us and our families.

On 29 May, let us elect the right people, who will make the right choices to restore the hope and dignity of every South African, that only a secure job can ever provide.

Download the  DA’s Economic Policy .

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Impact of unemployment on communities in South Africa

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What is the impact of the high rates of unemployment on certain communities dealing with joblessness, and how does this affect currently employed individuals?

Unemployment is one of South Africa’s biggest challenges and the current state of the economy is not making it any easier to combat this societal issue.

The unemployment rate continues to rise by significant numbers, affecting mostly the youth who remain under strain trying to secure jobs.

Unemployment not only affects citizens who are struggling to find a place in the labour force, but it also affects communities and our society at large.

So, how exactly are South African communities affected by unemployment and what does this mean for them and for society?

Unemployment in South African communities

It is without a doubt that being unemployed can affect individuals in more ways than one. It can play on their psychological and emotional state, potentially affecting the way they view themselves, and often resulting in self-condemnation or feelings of inadequacy and worthlessness.

However, unemployment also affects the broader communities dealing with high levels of unemployment .

You will often find that these communities are dealing with a lack of fundamentals like basic services, and poverty will be rife where unemployment thrives.

Impact of unemployment on the community in South Africa

Unemployment in South Africa has vastly detrimental effects on the people who cannot find jobs, but it also does great harm to communities.

In communities that have high unemployment numbers, you will find that poverty is thriving.

This is due to the fact that these communities not only probably have a scarcity of resources, but are communities with inefficient economic systems where inequality is most likely also rife.

When a community is drowning in unemployment, there is more likely to be scarce employment opportunities, low quality housing, and a lack of access to basic services as a part of human rights, which takes away the human dignity of these people in these communities.

Basically, high unemployment leads to higher levels of poverty in communities.

What are some psychological effects of unemployment?

Unemployment can be damaging psychologically to individuals who are unemployed. Human beings will respond in certain ways to dealing with being unemployed.

The psychological impacts of unemployment can very easily go unnoticed, but they are just as important. One major psychological effect of unemployment is mental illness.

Unemployed individuals are more at risk of developing mental illnesses, which could lead to unhealthy coping mechanisms such as alcohol and substance abuse, depression and anxiety, a lack of self-confidence, and suicidal thoughts.

Stress-related issues can also result in illnesses and diseases.

What is considered unemployment?

If you are a person that is without a job, then you would be considered unemployed. This means you do not have any part-time, full-time, or independent contractor employment position.

If you are actively in search of a job and are currently available to do work but do not have a job, you are also unemployed.

If you are on a temporary layoff, you would also be considered unemployed even if you could possibly be employed again in the same position in the future.

Tips for anyone who is unemployed

Some tips for dealing with unemployment in your life can be helpful. It will encourage you to allow yourself to feel what you are feeling.

Unemployment is one of the most stressful circumstances to deal with, and sometimes allowing yourself to feel emotional about it can be helpful.

It can be best to think of unemployment as a temporary setback and not a permanent one. This can help motivate you, and manifest more positive thoughts to regain your self-confidence.

You can also try to start networking with people in your industry, as this can lead to opportunities.

Final thoughts

The unemployment rate in South Africa is an ongoing fight that only seems to get exacerbated every year. As unemployment keeps rising, it puts unwanted strain on an already struggling economy.

The effects of unemployment can be felt by both jobless individuals and the communities they come from. There are different ways that unemployment negatively affects communities with high rates of joblessness.

Poverty and inequality are the biggest results of unemployment in communities, as well as an absence of access to fundamental basic services due to a lack of efficient economic systems in these areas.

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Maimane pledges to tackle unemployment, overhaul education in SA

• BOSA members during a party gathering.
• Image Credits :
• Twitter@BuildOneSA
• 29 January 2024, 04:21 [SAST]

Launched in Naledi Soweto just 15 months ago, the Build One South Africa (Bosa) movement held its first manifesto launch at the heart of Johannesburg on Sunday.

Former Democratic Alliance leader and now Bosa leader Mmusi Maimane vowed to tackle South Africa’s high unemployment rate while improving the country’s education system.

Maimane received a hero’s welcome during Bosa’s manifesto launch as he ascended to the podium just after lunchtime on Sunday.

He promised scores of his supporters who had gathered at the event that the party would create at least 2 million jobs in the next five years.

He said that no household in South Africa should be jobless.

“I’ve said it to you and I will say this to you again. This year we are going to deliver in the next five years when we come into government, a government that delivers 2 million jobs in every household in this country. Amandla.”

 ‘The task on our shoulders is a big one’: Mmusi Maimane

Maimane claimed that the creation of jobs under Bosa will in turn help tackle food insecurity in the country, adding that the party will ensure that no person in South Africa goes to bed hungry.

“It’s a moment in our country where you feel like you need David to take down Goliath. We need to be able to look at the Giants in our land, whether those are giants of poverty and unemployment, and we need to say, we need more and more Davids in all our communities to fight to bring change.”

“One of the giants that we face is that we live in different South Africa. We live in South Africa where others wake up in the morning to throw away food while others don’t have food.”

Power utility Eskom also took centre stage during Maimane’s speech on Sunday. This is as South Africans have been battling rolling blackouts for years under the African National Congress government.

But Maimane has assured South Africans that under Bosa, Eskom’s load shedding will be a thing of the past.

“Under Bosa, we are going to introduce SMRs that [will] ensure that we can keep the lights on, fix Eskom and employ the best people. So that none of us in the next two years don’t have to face load shedding. Ha load shedding e fele, ba re bolaya batho ba [these people are killing us].”

Maimane, who has also been vocal against the country’s schooling system, also criticised the government for the low matric pass rate.

He deplored the government’s low standards of education, including the 30% pass rate, which he said was stifling the country’s learners.

“It is not the stupidity of our children or anything like that. It’s a government that wants to treat them and reduce them to that. That is why I say you miseducate our children, you oppress them. Our children are diverse and talented. Let’s give them the best opportunity to shine,” explained Maimane.

Maimane, who is no stranger to politics, served as the DA leader from 2015 until he resigned from the party in 2019. He thereafter formed Build One South Africa in September 2022.

He will contest the upcoming general elections for the first time this year.

Below is Bosa’s manifesto launch

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November 15, 2019

The Fourth Industrial Revolution: Impact on unemployment and inequality in South Africa

By makhethe makamase.

The Fourth Industrial Revolution (4IR), a concept reconstructed by Founder and Executive Chairman of the World Economic Forum, Prof  Klaus Schwab , elucidates the increasing merger of technology with the physical and biological spheres, thus indefinitely altering how humans interact with their surroundings and amongst themselves. This phenomenon has subsequently been placed  at the centre of various economic and political agendas. South African President, Cyril Ramaphosa, in his 2019 State of the Nation Address (SONA), emphasised the urgency of equipping the nation for the fourth industrial revolution and the necessity to adapt and embrace the various opportunities it presents. However, according to Prof Schwab “organizations might be unable to adapt; governments could fail to employ and regulate new technologies to capture their benefits; shifting power will create important new security concerns;  inequality  may grow; and societies fragment”. This commentary piece seeks to provide an overview of the fourth industrial revolution from a South African perspective and its impact on the country’s biggest challenges of inequality and unemployment.    

The establishment of the Presidential Commission on 4IR was announced in the SONA (2019).  The commission consists of thirty members comprised of prominent individuals from various sectors with relevant knowledge and skills to advance the nation’s 4IR mission. New partnerships such as the African Fourth Industrial Revolution Centre (SAFIRC) to be hosted by the Council for Scientific and Industrial Research ( CSIR ) will equally serve to strategize, plan, create and regulate policies towards advanced 4IR technologies in the pursuit of national and pan-African development objectives. Despite the optimism portrayed by the current government on 4IR, potential for disappointment especially for the poor and unemployed youth is irrefutable. The commitment to generate over two million jobs in ten years through  government and private sector  cooperation as stated at the SONA (2019), was ostensibly contradicted in his 25 years of democracy speech at the University of Johannesburg when President Ramaphosa informed the nation to brace themselves for  mass job losses  and furthermore acknowledged the lack of progress by government in job creation.

South Africa’s total unemployment rate recently reached  29.1% . However, when factoring in discouraged job seekers and the economically inactive population the number escalates to nearly 40%. This is especially severe when factoring in that over  50%  of the youth are unemployed. Approximately ten million people are unemployed, seven million are actively seeking employment and about three million are unemployed, despondent and stopped seeking jobs. The majority of South Africans (mainly black) are impoverished and the inequality gap has significantly increased since 1994. The top 1% controls 70% of the  country’s wealth , leaving the bottom 60% with only 7% of the wealth. Rural areas, townships and informal settlements occupied predominantly by poor black people have less or no infrastructure, meaning electricity and access to technological resources amongst other services are a challenge. Competition for resources and increasing marginalisation of the poor has resulted in cases of social unrest, which manifest in forms of violent protests and xenophobic attacks amongst other imminent issues.   

The large scale retrenchments in the banking sector serve as one of the first and major examples of 4IR’s implications on human labour in South Africa. In March 2019, Standard Bank announced a closure of 91 branches nationwide and in June 2019, the number had increased to 104 branches closing and the loss of  1200 jobs . In July, Nedbank announced an estimate of 1500 job redeployments or retrenchments, while Absa is in the process of restructuring its operations processes. In September 2019, the Johannesburg Labour court interdicted what would have been the biggest bank strike since 1920, led by the The South African Society of Bank Officials (Sasbo), the Finance Union supported by the  Congress of South African Trade Unions (Cosatu) – who are equally threatened as human labour becomes obsolete in some areas. The strike was expected to have 30 000 to 40 000 participants.

According to the World Bank, South Africa’s net wealth distribution is one of the most unequal in the world. Though South Africa – alongside Kenya and Nigeria – has been globally recognised as an emerging  technological hub  with the potential to transform and increasingly integrate their society with the rest of the world and benefit from 4IR, a quarter of its population (13.8 million) is living below the poverty line at  less than R19 a day  which does not cover basic food and certainly not other living expenses. A people centered development approach and public participation towards building social and human capital is vital. The empowerment of people through skills and access to resources in different sectors will enable their economic participation and curb the impact caused by fading jobs and slow economic growth. A response mainly from government at this pivotal moment is crucial as President Ramaphosa stated that “the promise of our nation’s birth will forever remain unfulfilled” if the country fails to adapt and not take advantage of the 4IR.

Ms. Makhethe Makamase is a Research Assistant at the Institute for Global Dialogue (IGD) associated with UNISA. Her views do not necessarily reflect those of the IGD.

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OPINION | SA needs a game-changer to tackle its unemployment crisis

Everyone agrees that solving the unemployment problem in South Africa is the number one priority. We've seen a lot of interventions that don't work. Imraan Valodia suggests how we might find some that do.

• For more financial news, go to the  News24 Business front page .

It’s worth starting by acknowledging that the problem is complex and there are no easy solutions. It is important to understand why unemployment is such a vexed problem, why it has remained a feature of the post-apartheid labour market, why some parts of the problem are found in other countries and why others are unique to South Africa. And how solving unemployment may be related to wider economic policies.

But address it South Africa must – because it’s the primary driver of inequality, a root cause of other social and economic problems, and a massive waste of human resources.

The official unemployment rate is 32.9%. If discouraged workers are included (people who have given up trying to find jobs), the unemployment rate is 41.9%. For young people, aged 15-24, the unemployment rate is 59.7%. If discouraged workers are included, about 11.2 million South Africans are unemployed.

Seriously tackling unemployment requires being clear about a few things.

First, it’s important to understand why unemployment in South Africa is so high. There are two main sets of issues – some global (such as changing employment patterns), and some specific to South Africa (such as the legacy left by the country’s apartheid past.)

What I conclude is that addressing South Africa’s unemployment challenge requires some new thinking and an acknowledgement that policies that seek to deregulate the labour market are no solution.

South Africa requires policies to increase the demand for labour – that means finding a new growth trajectory that is employment intensive. These could involve much greater public investment in rural areas and townships – addressing backlogs in infrastructure like transport that is important for linking people to markets – as well as promoting the informal economy and small businesses.

The country also needs a game-changer to get the economy onto a labour absorbing path. One possibility is fighting climate change. South Africa has a high natural advantage in the production of solar and wind renewable energy. More investment in renewables and the related manufacturing and services activities which go into the production of clean energy and which require clean energy as a key input has the potential to shift the economy in a way that generates employment.

The drivers of unemployment

Two global issues driving unemployment are important.

First, across the world, for much of the last three decades, technology has been changing at a rapid pace – computer technologies were followed by digital technologies and then artificial intelligence.

Technological change has had a significant impact on jobs . In net terms, it has reduced the number of jobs and wages, especially for low-skill occupations, and increased incomes for high-skill occupations.

Second, China’s incorporation into global production systems has had large effects on employment across the world. Harvard economist Richard Freeman has called this the " great doubling " of the global labour force. The result has been that production has moved to China, and reduced employment elsewhere.

The key South African issues are also twofold.

First is the distorting impact of apartheid on the labour system. There are three effects worth mentioning:

One of the most deleterious effects was that most Black women were not allowed to live in the cities, and therefore could not work for wages. Under apartheid, most of these women were classified as "economically inactive" and therefore not in the labour market. With the end of apartheid, there was a large increase in women migrating into the urban cities. In the post-apartheid period, these women were enumerated as economically active and since most were unable to find work, they swelled the ranks of workers classified as unemployed. This led to a large increase in the official unemployment rate, although many of those women were unemployed in the previous period – they were just not classified as such. Daniela Casale and Dori Posel have done excellent research on this issue.

As highlighted by the South African sociologist Harold Wolpe, the homelands and rural areas served essentially as spaces for women, children and retired men to live in, without any serious productive economic activity in these areas. Homelands were rural areas the apartheid government demarcated for black people to live in. This stripped them of any rights to live in, or work without a special pass in, what the government declared were “whites only” areas which made up 87% of the country.

The apartheid state crushed much of the entrepreneurial activity among Black South Africans to force African men to migrate to work in the mining industry. This was researched exhaustively by, among others, the South African historian Colin Bundy.

The second national issue affecting the job market is that while employment has risen and new jobs have been created, the size of the labour force is increasing at a faster rate than the net number of new jobs created.

What won’t work

So what’s the solution?

One argument put forward is that the South African labour market is over-regulated. That there is too much protection for workers, and wage levels are too high for employers.

An additional argument is that workers’ skills do not match what is needed by employers.

All of these see the problem on the supply side of the labour market. That is, unemployment is caused by workers expecting a wage that is too high, not having the right skills, or expecting too much protection.

Proponents of this view argue that reducing protection and reducing wages will allow the labour market to clear and unemployment will fall.

There are a number of reasons why such a strategy will not work.

First, it ignores the country’s history and trends. Second, depressing wages is not politically feasible and will lead to growing inequality in South Africa. Third, it underplays the key issue: the economy, even when it is growing, is generating fewer jobs than the increase in the labour force.

Some solutions

So, what might be a policy package that could address unemployment in South Africa?

The economy has to shift to a growth pattern that increases the demand for labour. Some elements of this would include:

Much greater public investment in rural areas and townships, to generate better economic integration in these areas, and boost the demand for labour. Examples of this include investment in transport systems, telecommunications, systems that promote exports.

More accommodating macroeconomic policies – essentially, public expenditure and taxation and monetary policy such as interest rate policies – that promote employment-intensive growth. South Africa’s monetary policies have focused on reducing inflation, through high interest rates. High interest rates might attract capital to South Africa, but they do very little to encourage firms to invest in production and related activity, which creates jobs. The country’s macro policies should be focused more on promoting investment by firms to generate employment. This is not to suggest that inflation control is not important, but a better focus on employment is also needed.

South Africa’s informal economy is small compared to its peers. Policies for greater public investment in marginalised areas will boost informal work opportunities.

More investment in renewables and related production which requires clean energy, to take advantage of the country’s high natural advantages. There are two components to this – manufacturing all the inputs for rolling out renewables and also using clean energy to produce goods that are classified as "green goods".

Imraan Valodia , Pro Vice-Chancellor: Climate, Sustainability and Inequality and Director: Southern Centre for Inequality Studies., University of the Witwatersrand

This article is republished from The Conversation under a Creative Commons license. Read the original article .

News 24 encourages freedom of speech and the expression of diverse views. The views of columnists published on News24 are therefore their own and do not necessarily represent the views of News24.

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Unemployment Speech | Speech on Unemployment Speech for Students and Children in English

April 10, 2023 by Prasanna

Unemployment Speech:  Unemployment is a severe issue restrained to any particular country but faced by all countries of the world during a period of recession. However, the type of unemployment may vary from one country to another, like India’s case; it is chronic unemployment, which has made it a significant problem in India.

Unemployment can be defined as the unavailability of jobs for people who are willing to work. Among many reasons, high population and consequently increase in demand has led to the unemployment problem in India. However, in some other countries, unemployment may occur due to the recession period of the business cycle.

Unemployment should not be ignored in a country as it can become the reason for its doom if not taken into account.

Students can also find more  English Speech Writing  about Welcome Speeches, Farewell Speeches, etc

Long And Short Speeches On Unemployment for Kids And Students in English

In this article, we provide a long speech for students and children on the Unemployment problem with about 500 words and another short speech with 150 words approximately on the same topic.

These speeches can help anyone who is looking forward to presenting a speech on the topic, as mentioned above, be it students, teachers, or any other research person.

Furthermore, we have also included ten Lines on the topic and some FAQs to make the content clearer to our readers.

A Long Speech on Unemployment is helpful for students of classes 7, 8, 9, 10, 11 and 12. A Short Speech on Unemployment is helpful to students of classes 1, 2, 3, 4, 5 and 6.

Long Speech On Unemployment 500 Words In English

Good morning/afternoon/ evening to everyone present here, I am obliged to welcome each of you to discuss a severe and emerging problem of the world, unemployment.

Before getting into the topic, I would like to give a small gist of how and why a country is faced with unemployment. Some of the most common and primary reasons could be population growth, slow economic growth, slow growth of service and economic sectors, seasonal unemployment and decrease of small scale industries, etc.

These being some of the most common reasons for unemployment in India, the situation has worsened so much that people with high degrees are on the verge of unemployment either due to no jobs or due to a low pay scale. Apart from these, there is a significant population in India that is linked to the agricultural sector.

In the agricultural sector as well we get disguised unemployment, without people even being aware of it. Another problem of the agricultural sector is that many crops or plantations only provide employment during the harvesting month or when the crop is finally ready to be sold; the remaining time proves to be jobless for many farmers. This gives rise to seasonal unemployment.

Unemployment is a tragedy for the individual who feels he/ she is incapable of earning a living and for their families who have to go through a hard time. Moreover, it is a tragedy for the country and cannot cater to the rising talent among its youth, and misses out on the untapped talent.

The youth of the country or the young generation is hard-working, and they are ambitious. They have great talent, but it becomes difficult to even for the Government to cater to huge demand, and this has given more condition to the idea of “the best one wins.”

The population of educated people is increasing by each passing day, and the Government is unable to employ them at workplaces. The literate youth is not satisfied with the inconsistent salary offered to them, and the danger of unemployment makes the situation worse.

Since most youths do not have the technical knowledge or practical expertise, they are also offered clerical jobs with not enough to accommodate their satisfactional needs.

Those who have technical knowledge even face more disappointment as they cannot get a decent job as per their qualifications due to the long lists of applicants available.

Though it was perfect that people are becoming more aware of the situation now and most of them are getting educated to secure a better future, one should have technical skills and knowledge of their studies that can help them in the long run. The change of curriculum by the Government will also help to improve this problem.

Thus, we have to overcome the situation of unemployment as a country, and each of us need to work on ourselves to make a better future. The Government should also take further steps to cater to the increasing yet talented demand.

Lastly, I would like to thank you, the audience, for having patience and turning up today for this noble cause.

Short Speech On Unemployment 150 Words In English

A very good morning/ evening to one and all present here, I appreciate your efforts to gather here to discuss the problem of unemployment in today’s world.

Unemployment is a significant problem in almost all countries of the world, be it developing or developed. However, the incidence of unemployment is different in both cases.

In the first case, the problem is chronic and affects the economy and wellbeing of the people. However, in developed countries, unemployment instead occurs due to the recession in the business cycle and temporary. It can also be voluntary unemployment, which does not affect the wellbeing of individuals.

India being a developing country, is no exception.

Here we have chronic unemployment, which has resulted in the brain drain of our country and many potent problems faced by our youth. Though the IT sectors have developed over the years, the underdevelopment of other sectors aggravates the problem.

Thus, government initiatives are required in this regard for a better future of the coming generation.

10 Lines On Unemployment Speech In English

• The young generation is three times more likely to remain unemployed than the older generation.
• It is estimated that 23% of the youth are currently unemployed in the world.
• Seventy-five million people are trained each year but have no job.
• In the year 2013, there were about 157.1 unemployed people throughout the world’s developing countries.
• Among all regions, east India has the highest rate of unemployment.
• However, 4.5% of East Asia’s unemployment rate, which is quite low.
• Among other developing regions of the world, sub-Saharan Africa has the second most jobless people, followed by South Asia.
• Around 600 million young people aged between 15-24 years are not into education, employment, or training.
• The International Labour Organisation (ILO) estimates that the global youth unemployment rate is expected to reach 13.1% in 2016 and remained throughout 2017.
• Almost 90% of young people live in developing countries in the world.

FAQs On Unemployment Speech

Question 1. What are unemployment insurance benefits?

Answer: Unemployment benefits refer to partial replacement of regular earnings and help one to meet expenses while one looks for another job. They are not based on financial needs.

Question 2. How do I stop claiming unemployment benefits?

Answer: The simple way to stop one’s claim is t stop filling your weekly claims. One may stop claiming at any time they wish to during the benefit year.

Question 3. In which type of employment, marginal productivity is zero?

Answer: In disguised unemployment, marginal productivity is zero because many workers are involved in the agricultural sector, whereas their contribution to the total output is zero.

Question 4. What type of unemployment is found in developed countries?

Answer: Voluntary unemployment is the most common type of unemployment found in developed countries.

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Ramaphosa’s speech to parliament listed south africa’s old problems – but no new solutions.

South African President Cyril Ramaphosa’s  opening of parliament address  successfully captured the spirit of a diverse and cohesive multi-party government ready to get down to work. But it failed to tell South Africans how the new dispensation will do things differently, and better.

In the May 2024 national and provincial elections, Ramaphosa’s African National Congress party received  just over 40%  of the national vote, triggering a multi-party coalition government for the first time in 30 years. The results signalled frustration with the ANC’s inability to promote job-creating growth, achieve significant reductions in poverty and inequality, and demonstrate clean governance.

Ramaphosa’s speech should have been cast as a delivery re-set. It should have signalled to the country how the new government of national unity will do things differently and better than previous ANC administrations. Instead, Ramaphosa set out the problems that are already well known to most South Africans.

Ramaphosa laid out three strategic policy areas the unity government will prioritise over the next five years:

• inclusive economic growth and job creation
• reduction of poverty and the high cost of living
• building a capable, ethical and developmental state.

Based on  my research  on the government’s policy and governance track record, his speech was remarkably unfocused, unbalanced and at times inconsistent and unrealistic. It outlined a wishlist of familiar sounding policy themes.

The speech was delivered with poignant symbolism on  the birthday  of South Africa’s reconciliation icon, Nelson Mandela. The president reminded South Africans of the historical significance of their electoral choice. It’s this choice that forced political opponents into a collective project and abandoning the politics of “recrimination”.

Unity anchored Ramaphosa’s speech. If this was the sole metric to evaluate its success, one would say the president succeeded. He drew on a mix of both uplifting and distressing imagery to reinforce his message of political unity. This included countless acts of service being performed across the country and around the world in honour of Mandela Day. This was set against the backdrop of devastating floods, storms and wildfires ravaging the country under a global climate emergency.

Ramaphosa laid out the unity government’s priority areas for the next five years.

The first, “inclusive growth”, justifiably attracted the most attention, given its emphasis on attracting desperately needed job-creating investments.

He didn’t acknowledge the historically problematic relationship between growth and the equitable distribution of its benefits (inclusion). Historically, economic growth hasn’t been inclusive. He didn’t say anything about how the country’s low growth rate has jeopardised even the most modest prospect for inclusive investments.

Ramaphosa also didn’t explain how after years of  international investment conferences , concerns about  over-regulation , high government consumption and  debt-servicing costs , and poor governance, South Africa will finance the unity government’s  ambitious infrastructure spending plans .

More remarkably, Ramaphosa said that municipalities would now be enlisted in the project of inclusive growth. Yet, municipalities are neither constitutionally mandated nor adequately equipped for this task. They are struggling to deliver on their core mandate: the provision of basic services.

The second priority area – poverty and the high cost of living – is one that resonates with millions of South Africans. The persistence of poverty and inequality and the disproportionately high cost of living borne by the poor is a chronic problem with deep historical roots.

Previous ANC administrations have struggled to address this issue. They used poverty reduction strategies, indigent policies, better quality education from reception to vocational training, improving public transport, and more accessible healthcare.

The president did cite potentially effective measures such as a review of prices of goods and services that are set through  administrative decisions  by government, a public entity or a regulator. There’s also the conversion of the current  Social Relief of Distress grant  into a broader and “sustainable” income support vehicle. But he seemed to fall short of promising a  universal basic income grant .

The third strategic policy area is one that is close to my own work, and for which I had particularly high hopes. That is improvements in the capacity, integrity and developmental potential of state institutions. It’s this area that will equip the government with the ability to deliver on the other strategic areas. Yet, Ramaphosa spent the least amount of time on this most crucial of areas.

In fact, it felt like an afterthought. In the main, the president affirmed earlier commitments. These include the  professionalisation of the public service , rooting out  corruption  and combating gender-based violence. And also, improving the performance of state-owned enterprises through a new  centralised public ownership model .

Ramaphosa’s speech did meet the symbolism of a new political dispensation. But it failed to offer detail on how this new dispensation will address familiar issues in new and better ways.

Its policy content was no different from before. Except for the extended references to unity, it could have been a speech delivered after another ANC electoral majority win.

Perhaps it is unfair to expect the president and his multiparty cabinet to have worked out the details so soon. The coming weeks and months will tell whether the unity government can live up to the task South Africans have set for it.

Vinothan Naidoo is Associate Professor of Public Policy and Administration, University of Cape Town. This article first appeared in The Conversation .

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Published Jul 28, 2024

South Africa’s unemployment rate is soaring and people are struggling to find work. Is entrepreneurship the answer to solving the unemployment question?

According to data from StatsSA, SA’s unemployment rate increased from 32.1% for 2023Q4 to 32.9% for 2024Q1.

Nkosinathi Mahlangu, head of Youth Employment Portfolio, Momentum Metropolitan said that the SA economy is at a stage where economic activities and sustainable livelihoods will not only be realised through formal employment.

“We have seen South Africans turning to entrepreneurship out of necessity,” Mahlangu said.

Raizcorp chief executive Allon Raiz agrees with Mahlangu that there are many South Africans choosing the path of entrepreneurship because the cannot find formal employment.

“There has definitely an increase in entrepreneurs due to unemployment,” Raiz said.

According to Francine Mashabela, Career Centre Manager, IIE Varsity College, the unemployment crisis has pushed people to choose the route of entrepreneurship because they need to fend for themselves.

One such entrepreneur is Zethu Nyali, the founder of Zee Organics who started her business because she could not find employment during Covid. Nyali said that although she studied science, she was unable to find formal unemployment.

When her sister fell sick with cancer and was having issues with psoriasis she created products to help her sister. After having no luck at finding a job, she started a business in 2021 to sell the same products that she created to help her sister.

Nyali said that she would definitely recommend that people start their own business if they cannot find a job rather than sitting at home jobless.

One of the major benefits that Nyali, has found by starting her business is that she has been able to employ other people like the 10 people that work for her.

According to Mashabela, the number one benefit of entrepreneurship is job creation because new businesses create new opportunities that were not there before, plus they help with the growth of the economy.

Mashabela said: “Unemployment crisis will continue to be quite a big problem therefore it is important for entrepreneurs to empower other people through job creation.”

On the flip side, there is also a large number people that are entering the market because they see entrepreneurship as an opportunity, according to Raiz.

Mashabela said many South Africans are choosing entrepreneurship over formal employment because they find themselves inclined towards entrepreneurship.

“They appreciate the flexibility and independence of entrepreneurship opportunities,” Mashabela said.

According to Mashabela, the younger generation enjoy flexibility and they want to be a part of the solution of in terms of solving the unemployment crisis in SA rather depending on someone else to give them a job or solve the problem for them.

Unlike the younger generation, many people of the older generation are more inclined to depending on someone else to give them a job.

According to Mahlangu, entrepreneurship is also seen as an income supplement to the employed as we have seen South African’s having “side hustles” which are entrepreneurial.

Raiz added that entrepreneurship is great learning ground for young people through which they can gain experience and then move to the corporate world.

Advice for aspiring entrepreneurs

Regardless of the reasons that you want to become an entrepreneur it is vital that think through the decision carefully.

Here is advice from Mashabela and Raiz to help out aspiring entrepreneurs.

– Mashabela said: ”Be clear that starting a business and entrepreneurship is definitely the right path for you by knowing that whether you have the qualities of successful entrepreneur or not.“

– Knowing the problem that your business is going solve and how you are going to solve that problem is crucial, Mashabela said. It is important to set yourself a part from other businesses and creativity can play a huge role in that.

– Raiz said that entrepreneurs need plan properly by having a business plan that has 24 month outlook rather than 12 months and having twice the funding than they originally planned for therefore reinvesting in the business is important.

– Entrepreneurs need to listen to the market feedback and keep adapting to the feedback otherwise they won’t survive, according to Raiz.

– Mashabela said that entrepreneurs need to be realistic because trying to start a business can be a long, hard journey but with persistence it is possible to get the business going from the ground up.

Business mentor

Finally, it is crucial that entrepreneurs surround themselves with other entrepreneurs and mentors who can help them get through both the emotional and technical part of business growth, according to Raiz.

Mashabela said: “Entrepreneurs need to connect with the relevant people to support them on their journeys to successful.”

Raiz said that mentors are a critical part of the journey because they give a different perspective and to have a honest external perspective is very powerful as it opens up a different way of thinking.

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DPWI calls for reform of EPWP as unemployment rate remains high

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Public Works and Infrastructure Minister Dean Macpherson

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25th July 2024

By: Tasneem Bulbulia

Senior Contributing Editor Online

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Public Works and Infrastructure Minister Dean Macpherson says ongoing protest action by hundreds of former Expanded Public Works Programme (EPWP) employees in eThekwini, KwaZulu-Natal, shows that the programme needs to be reformed to provide a sustainable pathway to permanent employment.

“The EPWP programme was always designed to be a short-term programme to give recipients work experience and training in order for them to find permanent employment. However, due to the stubbornly high unemployment rate in South Africa, many have grown dependent on the programme, having been employed as an EPWP worker for many years.

“As mentioned during the Department of Public Works and Infrastructure’s budget speech last week, it is therefore imperative that the EPWP programme be reimagined to become skills outcomes-based which leads to South Africans climbing up the opportunity ladder, rather than being stuck in the EPWP for years on end,” he emphasised in a July 25 media statement.

Macpherson said he looked forward to working with all stakeholders in the coming months to lead to better outcomes for recipients nationwide.

“It is possible to build a better, more prosperous South Africa but only if all stakeholders work together towards a common vision. As a department, we are committed to working with local government to design better public programmes, cut red tape for infrastructure investment and turn the country into a construction site. Let’s build South Africa,” he urged. 

Edited by Chanel de Bruyn Creamer Media Senior Deputy Editor Online

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South Africa’s DA party takes ANC to court in sign of friction between new coalition partners

FILE - In this photo provided by the South African Government Communication and Information System, (GCIS), South African Président Cyril Ramaphosa, right, greets opposition Democratic Alliance (DA) leader, John Steenhuisen, left, at the first sitting of Parliament since elections, in Cape Town, on June 14, 2024. South Africa’s Democratic Alliance took the African National Congress, the party it co-governs the country with, to court Thursday July 25, 2024 over a preelection speech in May given by President Ramaphosa. (South African GCIS via AP, File)

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CAPE TOWN, South Africa (AP) — South Africa’s Democratic Alliance took the African National Congress, the party it co-governs the country with, to court Thursday over a preelection speech in May given by President Cyril Ramaphosa.

It’s an early sign of friction between the new coalition partners. The court papers were submitted to the Electoral Court by the DA in May before it entered into a coalition with the ANC, but it decided to still go ahead with the case.

The DA asked the court to deduct 1% of the vote received by the ANC in the May 29 national election and fine Ramaphosa, the ANC leader, $10,900 and his party $5,450, over what it argues was a presidential address that was used for election campaigning and amounted to an abuse of office.

The ANC responded Thursday by calling the DA’s legal action “frivolous and unwarranted” and said the president was following the constitution when he made the speech.

Ramaphosa gave the speech three days before the election in his capacity as head of state, but used parts of it to highlight what he said were ANC successes during its 30-year rule as South Africa’s governing party. The DA said that election rules don’t allow him to engage in party politics and campaign for the ANC when he speaks as the president.

The ANC lost its long-held majority in the historic election when it received just 40% of the vote. That forced it to create a coalition government for the first time to run Africa’s most industrialized country. The DA — the second biggest party with 21% of the vote — is one of seven parties represented in Ramaphosa’s Cabinet despite previously being the ANC’s fiercest critic.

The coalition, referred to as a “government of national unity,” created a new political landscape for South Africa after the ANC had governed since the end of the apartheid system of white minority rule in 1994. The election was the first time in South Africa’s young democracy that more people voted for other parties, stripping the organization once led by Nelson Mandela of its dominance.

The left-leaning ANC and the centrist DA are the key parties in the coalition but them working together was seen as unlikely given their stark ideological differences and history of opposition to each other. They have largely managed to project a sense of unity over the last month since the coalition was agreed.

AP Africa news: https://apnews.com/hub/africa

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Spanish construction firm Sacyr hired Santander and Deutsche Bank as financial advisers to find a partner for new unit Voreantis as a way to raise cash and better compete with larger rivals for contracts in countries such as the United States, a company source told Reuters on Monday.