Industrial policy approach to reducing youth unemployment in South Africa: time to change the optics

The South African government is making considerable investments in education to reduce youth unemployment. There is also a plethora of schemes to induce youth employment, including: a skills levy grant system to encourage workplace training; public employment services to match work-seekers to employers; financial incentives and tax breaks for apprenticeship, learnerships, and internships; employment tax incentives to encourage employers to hire young people; a training layoff scheme for distressed employers to prevent retrenchments; an expanded public works programme (EPWP) to hire the unskilled; and many youth development and job creation initiatives by state and non-state actors to transition youth into employment and self-employment.

The myriad of youth job-creating initiatives to date have not had the desired effect of reducing the youth unemployment rate, as demonstrated by the Quarterly Labour Force Studies statistics. Doing more of the same thing is unlikely to have the desired effect. Conditionalities are an untested weapon in the arsenal against growing youth unemployment. It is a powerful tool that the government can employ to change behaviours on an industrial scale. Getting conditionalities right in public procurement is not a simple task. It requires a capable public service, clear thinking, impeccable honesty, strong design capabilities and commitment to the public good. But it is vital if we are to stop youth unemployment in its tracks.

Edited excerpts from publication. Show less