Not ‘Neet’

10th May 2013

By: Terence Creamer

Creamer Media Editor

  

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Sadly, South Africa is no stranger to the scourge of youth unemployment. But the ‘Neets’ (not in employment, education or training) problem is now receiving heightened international attention.

In a recent article headlined ‘Generation jobless’, The Economist calculates that almost 290-million young people between the ages of 15 and 24, or nearly a quarter of the world’s youth, are neither working nor studying.

The phenomenon is resulting in major economic and social costs – the article quotes an economic-loss figure estimate of $153-billion for 2011 alone arising as a result of disengaged young people in Europe alone.

In addition, social discord appears to track youth joblessness trends, with youth unemployment in the politically fraught Middle East and North Africa region said to be more than twice the world average.

In South Africa, the phenomenon is particularly severe, affecting more than half of all young people and black youth even more acutely.

In a bid to make inroads into the problem, a range of inter- ventions have been proposed.

During his 2013 Budget address, Finance Minister Pravin Gordhan announced plans for a youth employment tax incentive, which would be released for consideration by lawmakers in the coming months. The idea is to incentivise absorption of young workers by private firms, without sparking opposition from those trade unions that believe a youth wage subsidy could create a so-called dual labour market, which would undermine the future welfare of workers.

In April, government, business and labour also signed a Youth Employment Accord, where commitments were made covering six areas. These included more education and training and work exposure, scaled-up public-sector initiatives, such as a National Youth Service Programme, set-asides for youth employment in specific industry sectors, support for youth entrepreneurship and cooperatives, and promises of sustainable new private-sector jobs.

In the end, though, economic growth will arguably have a greater impact on youth unemployment than all the accords and tax breaks combined. To be sure, igniting near-term growth will be the key to turning the Neets problem around, both domestically and globally.

Gordhan has argued that the spark for such an ignition could be generated through the fostering of a new social consensus on the economy – one akin to the negotiated settlement which provided the basis for a peaceful transition from apartheid to democracy.

Achieving such social consensus will be particularly difficult, especially in the context where the National Development Plan has emerged as a proxy for a variety of political battles.

But it is surely worth a try and impetus could well be provided by the fact that South Africa is now less than a year away from its milestone twentieth anniversary as a democracy.

Edited by Terence Creamer
Creamer Media Editor

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