Management and professional development

“South Africa is grappling with a surge in the number of youth entering the marketplace and the reality that the unemployment rate in the country is one of the highest in the developing world.”

Progress and economic mobility through education

The country faces a major challenge with regard to unemployment specifically amongst those aged 18–25. South Africa is not alone, our partners in BRICS such as Brazil are also facing an elevated youth unemployment rate and the G20 Summit in 2017 discussed ways to address this growing socio-economic challenge.

A recent report by the World Bank entitled Fair Progress? Economic Mobility across Generations Around the World indicated that globally, upward economic mobility has stalled for the past 30 years.

The reasons behind this situation are complex, according to the report. It tracks economic mobility between parents and their children by focusing on education.

With South Africa's budget now dominated by spending on education and a recent decision to introduce free education at tertiary level for the poor, this is critical to assess in a local environment.

Closing gender gaps

There are some positive signs for the youth around the world. In South Africa gender gaps are closing with girls beginning to out-perform boys in tertiary education and catching up generally.

The World Bank report indicates that in some parts of the world, the share of girls with more education than their parents will exceed the equivalent share for boys in the next few years.

However, apartheid's legacy and the attempts to deal with this means that the ability to move up the

economic ladder is a vital and core contributor to reduce poverty and inequality. Being able to do this irrespective of the socio-economic background of one's parents is part of the education drive and this is where South African youth may need to reconfigure their expectations.

An education policy that is dominated by technical training is regarded as part of the innovation drive internationally and the World Bank has warned that in South Africa, there is a problem.

World Bank CEO Kristalina Georgieva believes it is about parental aspirations as much as those of the growing child.

“We need to invest in children from a very early age so that they are well nourished and well educated; ensure that local communities are a safe place for children to grow, learn, and thrive; and level the economic playing field by creating good jobs and improving access to finance,” said Georgieva in a forward published by the bank.

While this report analysed data from 75 countries, it's the findings regarding South Africa that are illuminating.

Globally, the data shows that, on average, upward mobility from the bottom has declined and the number of people remaining trapped at the bottom has increased in developing economies.This is hardly motivational if you are a young black man or woman living in South Africa.

But there is a way out and rapid urbanisation is actually likely to overturn this picture.

Better development

Senior Director of Poverty and Equity Global Practice at the World Bank, Carolina Sanchez, said higher mobility in education means better development.

“Countries with higher mobility in education are better placed to generate future growth, as well as reduce poverty and inequality. And, conversely, stalled mobility raises concerns about future progress, particularly for Africa and South Asia, where most of the world's poor live and where the prospects of children are still too strongly tied to the socio-economic status of their parents.”

In South Africa, the bank reports that the role of parental social networks is a key barrier to mobility when jobs are rationed and unemployment high. A study of youth in this country found that the father's occupational networks have a powerful effect on the son's labour market outcomes.

The findings reinforce the post-apartheid reality that the son of a man who earns more in South Africa will make almost 70 percent more than the son of a lower income man.

Race and location in South Africa contribute to inequality which increases the persistence of income inequality across generations with the country exhibiting high inequality of opportunity.This is hardly new information to the majority but there is a positive light. It is education.

“Thus, a recent study finds that inherited circumstances, including the educational attainment, occupation, and race of fathers, explain a significant share of South Africa's earnings inequality (Piraino 2015),” the World Bank report said.

There is a high persistence of whites concentrated at the top of the earnings distribution. Ironically, this is echoed in the United States according to the report.

“In both countries, what appears to be low IGM of earnings is partly attributable to the deep differences between races that persist across generations, net of the effect of the economic status of parents.”

But it's not just about race as the important factors in South Africa.The bank has found that if black parents pursue higher education goals and their children are located in urban areas, economic mobility is improved.

Dealing with unemployment

In mid-May Statistics South Africa (Stats SA) published the first quarter 2018 Labour Force Survey which

found that the unemployment rate of those aged 15–34 climbed to 38.2 percent, implying that more than one in every three young people in the labour force did not have a job in the first quarter of 2018. While some were studying, government is highly aware of the ticking time-bomb in terms of socio-economic development this unemployment figure highlights.

The Stats SA report shows that when young people are employed in the labour market, their employment intensity is the highest amongst the trade, agriculture and finance and other business services industries.

Because of facts such as these, government has launched an exciting new empowerment initiative.

“The National Skills Fund has set aside R150 million to support colleges to ensure they are up-to-date and ready.The department will be presenting the plans to Sector Education and Training Authorities in the first week of April to secure their support. We will also meet with potential partners,” Higher Education Minister Naledi Pandor announced in March.

Since then the government has launched an artisan training support programme, with the Minister saying she was “astounded” to discover there were very few good bricklayers in the country, along with a weakness in the tooling sector, draughtpersons and welding.

Government is kicking off the new training philosophy by identifying and supporting 790 learners who will be part of priority training in electrical, plumbing, welding, carpentry, bricklaying and boiler making.

While this forms the basis of core skills, the fact that this learning programme will possibly lead to some of these youngsters going on to become engineers and highly-paid mechanics is part of the World Bank's point.

Economic mobility follows educational mobility, both are part of the same picture.