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Technology group shares internship lessons as search intensifies for youth employment answers

9th June 2017

By: Schalk Burger

Creamer Media Senior Deputy Editor

     

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A year’s work experience creates an 80% chance for a person to successfully enter and remain in gainful, productive employment for the rest of his or her life, says information and communication technology (ICT) multinational EOH Group business development director Brian Gubbins.

The International Monetary Fund’s (IMF’s) 2016 working paper on South African labour market dynamics and inequality states that “until the quality of education is improved to address the long-term unemployment challenge, policies aimed specifically at providing experience for young first-time entrants into the labour force will be important to improve their employability”.

Therefore, the implementation of programmes locally, such as the Employment Tax Incentive Act, which aims to provide the necessary on-the-job training and work experience for youth, is beneficial and serves as a stepping stone into formal employment.

Moreover, reducing unemployment remains a more viable and sustainable way of reducing income inequality, compared with only redistribution, though redistribution has played a very important role in reducing poverty, the IMF paper states.

This finding and the shortage of skills available to businesses in South Africa underpin the drive by businesses to develop skills and produce employable youths to pull the country out of its economic doldrums.

There are many private-sector-led and nongovernmental organisation projects funded by government in South Africa to train youths and stimulate youth job creation, and many are achieving success in meeting their targets. However, the scale of each individual youth job creation project is too small to improve the national availability of skills and work-ready youths, says Gubbins.

Therefore, the exhortation is for businesses in all industries to determine at board and executive level how they can increase their internship and learnership programmes to provide more people with work experience, he explains.

“By merely tweaking hiring procedures, specifically to include more youths for shorter periods, businesses can dramatically change the employment dynamic.”

EOH has been successfully demonstrating its internship and learnership model over the past five years since 2012, and believes that the model holds the greatest promise to change the employment dynamics of young people in the country.

The company provides yearly intern- ships for between 500 and 600 youths, and retains about 70% of them in long-term employment after the year-long internships.

“It uplifts our company [by providing it] with new skills and employees, strengthens employee morale, demonstrates to our employees that we care for the communities we work in and EOH and the ICT industry gain young new talent to nurture and leverage.”

The company and its network of partners have provided 25 000 youths with internships and learnerships since 2012.

“If every business in South Africa were to do the same, it would mean employment for hundreds of thousands of young South Africans. We believe that business needs to take up the role of further developing our youth. It is good for our society and it is good for business,” says former EOH CEO and youth job creation initiative initiator Asher Bohbot.

EXPERIENCE VS EMPLOYMENT
Employers often struggle to find, recruit and retain entry-level employees – the cost of which is massive for business – says brand strategy consultancy Yellowwood nonprofit organisation Harambee Youth Employment Accelerator CEO Maryana Iskander.

Therefore, the emphasis for youth employment schemes should be placed on workplace experience rather than job creation, states Gubbins. The job creation appellation reduces the likelihood of businesses providing more workplace experience, which can produce a flood of new entry-level and employment-ready youths, owing to the risks associated with employment creation.

Key to the success of such initiatives is the focus on the understanding of and responsiveness to the supply and demand sides of the employment market, says Iskander.

For young work seekers, it is essential to effectively address the access barriers and behavioural and competence gaps that keep them locked in unemployment and poverty, as well as their personal and behavioural readiness to succeed in the world of work.

Simultaneously, employers across many sectors have challenges finding work-ready candidates to fill vacancies, as well as retaining and progressing young employees.

“There is a need to grow the pool of work-ready, employable young South Africans to support inclusive growth, meet the needs of the growing sectors of the economy and of the public service, and [enable young people to take advantage of] the opportunities created by the infrastructure programmes and other industrial and economic development programmes,” Iskander confirms.

INTERNSHIP MODEL
The CEO Initiative, launched in January 2016, involves more than 150 large South African corporate firms and a R1.5-billion small and medium-sized enterprises fund. One of its aims is to provide internships for one-million youths over a three-year period up to the end of 2019.

EOH’s Youth Job Creation Initiative (EOH YJCI) – a separate private-sector project also launched in 2016 – aims to create 100 000 internships by 2020. This goal could increase, depending on how many companies, including State-owned enterprises, adopt an internship youth employment model, says Gubbins.

He highlights funding and incentives from the Department of Trade and Industry, Jobs Fund and the Employment Tax Incentive, and training and skills development resources from the Sector Education and Training Authorities (Setas) that are available for workplace experience, training and youth job-creation initiatives.

Further, EOH is making the lessons learned from its own internship programme available to partners in the initiative to improve the success rates and speed at which companies can adopt internship programmes.

The EOH YJCI suggests that companies employ 3% of their staff complement to provide internship and learnership positions for youths. The benefit is that this investment is augmented through incentives and funds, which dramatically reduces the amount required to provide internship positions, he says.

“We need all industries to take in youths, even for a short time. If South Africa can do this, we can not only turn the economy around, but also transform the economy within a short time.”

About 5.16-million youths are unemployed and not in training or receiving education. The figure increases yearly, as too few jobs are created yearly to absorb them, despite there being a shortage of skills available to all industries in South Africa.

However, business is not involved in youth job creation because of altruism or as part of corporate responsibility, but to stimulate the growth of available skills to build businesses, with the nett effect being economic growth and social stability, reiterates Gubbins.

CEO-DRIVEN
The Organisation for Economic Cooperation and Development bloc of developed countries’ ‘2016 Enhancing Employability’ report, which deals primarily with the changes to the skill sets required by industries, advises countries to expand participation in work-based learning to promote successful transitions from school to work.

This will improve the quality of skills development, as well as foster the participation of individuals from disadvantaged groups, including low-skilled people, the youth and migrants, in lifelong learning and employability programmes by addressing barriers to participation and providing appropriate incentives.

The report states that evidence shows there is a strong and positive correlation between the incidence of job training and productivity. At organisational level, the incidence of job training is linked to higher productivity, a more skilled workforce and more frequent technology adoption.

Gubbins emphasises that, to secure long-term success, youth internship programmes in companies must be driven by the CEO and his or her executive team, as well as the board, and must become part of managers’ objectives.

Introducing a successful internship and youth employment project requires that companies’ top leaders and executives set the targets and steer the growth and development of the training. This will lead to these projects becoming part of companies’ culture and a way of instilling and demonstrating their corporate values, as well as gaining access to new skills and selecting the best candidates after they have completed their internships.

“Business can help to fix the unemployment crisis in the country, which will lead to lower poverty, better economic growth and social stability. The more people employed, the healthier the economy.”

EOH encourages all businesses to become champions of youth employment and assert control over the employment dynamics affecting businesses. Collectively creating employment opportunities and work-readiness training can mitigate the youth employment problem, he concludes.

Edited by Creamer Media Reporter

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