Markets should drive job creation in South Africa

When I visit home in Kwa-Zulu Natal, I’m always saddened by seeing young unemployed people wandering around the township streets. Amongst these young people, there are many I grew up with. Some ask me for money, and I do help if I can. Most of...

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When I visit home in Kwa-Zulu Natal, I’m always saddened by seeing young unemployed people wandering around the township streets. Amongst these young people, there are many I grew up with. Some ask me for money, and I do help if I can. Most of them do search for jobs but to no avail. 

They end up giving up on the search; not only because they become disenchanted, but also because it becomes more and more expensive to look for employment. They have to pay for the travel costs, pay for access to the internet and pay for documenting their resumes. 

The process to look for employment can be tedious and expensive, especially when jobs are hard to find. The disillusionment and hopelessness experienced by my fellow mates in my neighbourhood, can be felt by millions of young people around South Africa.

South Africa is one of the countries with very high youth unemployment. It’s a challenge that the country has to conquer. The youth, described as those between the age 15 and 24, accounts for more than half of the nation’s unemployed. 

It’s a discomforting statistic that ought to prod the South African government to take drastic measures to address the crisis. This crisis does not only plague South Africa, it afflicts many countries around the world too. The most vulnerable to unemployment are the lower-skilled with only a matric qualification or less. So our government needs to look at effective ways to encourage job creation. 

If government does not pursue the necessary market reforms to boost the creation of jobs, then the future of this country will remain gloomy. What will worsen this undesirable situation is that our government continues with its deficit spending. We borrow the money we spend. While young people struggle to find employment, they will also be faced with a mountain of debt they will have to repay in the near future. 

Some of my closest friends have resorted to starting small businesses in order to earn income. My childhood friend has started a photography business back home. This is good because it will help him gain experience in entrepreneurship and earn income. But owning a business in South Africa brings a lot of challenges on its own.  

The processes and licensing requirements can be quite a pain at times. Not only is it costly in time, but also in money terms.  This discourages those who wish to start businesses, resulting in a slow-down on job creation for the youth.

And we should not expect much improvements in the job market in the near future. The push for the implementation of the national minimum wage law by the Deputy President, Cyril Ramaphosa, will certainly produce negative outcomes for the unemployed youth. 

Many of our youth lack the necessary skills required to compete in the labor market.  The introduction of the minimum wage law will close doors for many unskilled people in this country. There are sectoral minimum wage laws currently in place, and they have done the worst for my fellow young people who need jobs to get experience and make a step forward in life. 

This proposition of the minimum wage law will be beneficial to those who are employed, but some will lose their jobs if their employers no longer afford to pay their wages. Those without jobs will still wander around the streets, as the opportunities to gain working experience vanish. The beneficiaries will be government officials who are looking for votes in the next election. They will claim to have improved the lives of South Africans; when in fact, they would have served the interests of the few. 

Among the groups that also benefit from many of our government’s policies are trade unions. All trade unions like the idea of a minimum wage law. Because the people who benefit the most are their members. 

The introduction of the minimum wage will raise their wages while it makes it extremely difficult for the unemployed youth to find jobs. The law protects their jobs and shields them from competition by the unemployed. This is why they are supportive of Deputy President Ramaphosa’s ideas about the national minimum wage law.

The points I raised above suggest that government needs to minimize its interventions in the South African economy in order to accelerate job creation for the disillusioned youth. The people we elect into power should set their priorities right – abolish minimum wage laws, relax labour laws, cut government spending and reduce taxes to stimulate the economy. 

My friends back at home need jobs to get work experience and prepare themselves for their next higher-wage jobs. The future of South Africa depends on us the youth of today. But we cannot contribute much to the growth of this nation if we are unemployed. 

The majority of these young people are Black from troubled communities – where the effects of apartheid are still felt. It is my hope that our government will take drastic market reforms to address this crisis.

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