Abstracts

57 summarized in a recent economic policy document, the nation’s current economic trajectory is unsustainable: economic growth has stagnated, unemployment is rising, and inequality remains high. With young workers inherently the future of the country’s workforce, the percentage of youth unemployment, increasing from 51.1% at the beginning of 2018 to the highest ever in mid- 2019, signals a bleak outlook. Concurrent with this high youth unemployment, employers are having a difficult time finding workers with the appropriate knowledge and skills. Dr. Christie Viljoen, an economist at PwC in South Africa, recently stated that the number one reason for the stagnant economy in South Africa was “the lack of skilled workers” (2019). Reddy and colleagues (2018) conducted an analysis of various factors, such as employment pressure, priority/strategic demand, vacancy pressure, and wage pressure, that resulted in a list of occupations in high demand (OIHD) for the country. In the resulting report, OIHD are defined as occupations that show relatively strong employment growth or are experiencing shortages in the labor market. The report identified the most in-demand occupations as managers, engineers, and technicians, followed by some blue-collar jobs requiring intermediate levels of skills, such as carpentry, plumbing and pipe fitting, welding, and sheet metal work. The OIHD report makes it clear that South Africa’s labor market has a demand for intermediate-level to high-level skilled workers, people who hold a college diploma or at least technical qualifications after high school. The trend of increasing need for workers with higher education is also supported by other research. The recent report Getting Skills Right by the Organisation for Economic Co-operation and Development (OECD) (2017) argues that South Africa has significant imbalances, with an oversupply of low-skilled workers (surplus of manual and physical skills) and an undersupply of highly skilled (shortage of cognitive skills) workers. The Quarterly Labour Force Survey (Department of Statistics South Africa, 2019) also reported that more than half of the unemployed population in the country had less than a high school education level and that this percentage was growing. The conclusion is clear: there is a mismatch between the current skill level of the South African workforce and the current needs of business and industry. Even though there is an urgent demand for highly skilled workers in the labor market, more than half of the youth in South Africa are still unemployed because they do not meet the skill and/or educational standards of employers. The report, Higher Education and Skills in South Africa 2017 (Maluleke, 2019), stated that only 33.8% of youth ages 18 to 24 were attending educational institutions; 22.2% were attending school while 11.6% were attending post-school (education and training that occurs after the end of grade 9) educational institutions. Because more than 80% of youth are lacking formal education after grade 9, they have low competency in general, thus are unprepared for the needs of the labor market. In addition to the lack of education in general, another issue that leads to the skills gap is the poor alignment of the educational curriculum to the needs of the labor market. More than 30% of South African employees are working in a field unrelated to that in which they had studied (OECD, 2017). The major cause of this mismatch is a result of the lack of connection between the content of classes and industry practice, making it difficult for vocational students to apply their theoretical knowledge in practice. From the previous analysis it is clear that the main issues currently facing the South African employment market are the rising number of unemployed youth, the widespread lack of appropriately knowledgeable and skilled workers, a high demand for labor in only certain positions (many of which require advanced skill levels), and the mispairing between school teaching and the needs of the labor market. Within this framework, the focus of this article going forward addresses how to prepare the unemployed youth population to match the existing needs in the current labor market, thus creating a sustainable economic growth. For a broader understanding of the education issues facing South Africa, see the article by Dao in this volume.