South Africa’s unemployment crisis calls for innovative solutions, training and collaboration.
Six years ago Themba Khumalo dropped out of high school and started making hand-pressed bricks on an empty municipal lot. He heard about The Awethu Project on the radio, joined the incubator, and was selected for their SME investment fund. At 23, Themba now employs 22 people and produces 13000 bricks per day.
With unemployment in the second quarter of 2014 standing at 25.5%, or 5.2 million unemployed people, and a staggering 42% of people under the age of 30 unemployed, we need many more entrepreneurs like Themba. That’s the goal of entrepreneurial development company Awethu.
“We want to make sure that these stories are not so rare. They are real and possible with our model,” said Gareth Taylor, who runs Awethu incubator. Taylor was speaking on a panel at the recent Trialogue CSI Conference 2015, discussing models that work to create jobs.
Creating jobs via an incubator is a costly process, and the selection of the entrepreneurs to work with is crucial.
“It takes the same resources to invest in someone who will create 10 jobs as someone who will create one job. For social impact, it is important to identify those individuals who are going to go on to create a sustainable business that can who can employ 20 or 30 people,” says Gareth.
Awethu has identified four main characteristics that they look for in their potential entrepreneurs: high learning potential, willingness to learn, tenacity and ambition.
Finding the right person for the right industry is also key to Harambee Youth Employment Accelerator, an employer-led initiative connecting first-time job seekers with job opportunities. “We start with the client’s needs, where the demand is. We bring young people in for an assessment, match them with the right industry, and then help them to bridge to those skills,” said Chief Operating Officer Jackie Williams, who was also on the panel.
In the bridging programme, there’s a lot of emphasis on behavioural issues like punctuality where young people often struggle.
“The attitude is often the issue with entry level employment in South Africa. There’s also a big mismatch between how young people view work, and what is actually available to them. We get them to understand that they need to be connected to the economy, to build their own networks and CVs. There’s dignity and potential in working as a cashier.”
Harambee works with young people from rural areas and townships, who have a matric. It is extremely difficult for impoverished young people to search for a job, let alone land one. The majority of jobs are filled by people who know people, and impoverished youth have no networks to call on. “Poor people can’t afford to job search, “said Jackie. “Without cash for transport or Internet access it is virtually impossible to find a job. As a result, poor people are locked out of the job market and risk being long-term unemployed. We aim to break that cycle.”
They have placed 12 000 young people in the formal economy and plan to place 10 000 a year going forward. But the real scorecard is around staying in work, Jackie says: “If someone stays in a job for a year, they are likely to be employed for 85% of their working life. That changes the trajectory for the entire family.”
What’s clear from all the panellists is that job creation takes collaboration. The third panellist, Francois Viljoen of Open Africa, said that in the rural areas where they work, networks are, if anything, even more important. Open Africa is a social enterprise that establishes tourism routes, linking community-based tourism businesses like accommodation providers, tour guides and artisans, into off-the-beaten track, self-drive routes. The 2 500 enterprises that participate account for over 28 000 jobs.
He said, “Simply to be connected with peers and to learn from their successes and failures is critical. We provide a platform for emerging entrepreneurs, established entrepreneurs, municipalities and government to start working to the same goal. Don’t underestimate people’s willingness to be involved. We go to the private sector, and say we would like to bring a group of emerging entrepreneurs with you on this journey, would you be prepared to be involved, mentor others? The response is very positive.”
The three panellists described three very different approaches, but each had lessons to share. “To create jobs, we need to back and share successful models, particularly those that can be scaled,” said Viljoen in conclusion.
Written by Kate Sidley.