06/02/2016 Talking Business

Hello and welcome to Talking Business.

I'm Lerato Mbele in Johannesburg, South Africa, where the economy

And in turn, unemployment is rising, reaching

some of the worst levels in the past decade.

But joblessness is not just a South African problem,

it's an issue across the African continent,

where many young people are studying to access economic opportunities,

despite the past decade of economic growth.

That is the question on Talking Business.

This is Talking Business, coming to you from Johannesburg,

The question we are asking is, why is unemployment

getting worse, particularly as it affects young Africans who make up

To gauge the sentiment on the ground,

we took to the streets of Johannesburg to ask ordinary

From my point of view, the government is not doing

I wish, like, if the government could do

something like, let's say, find jobs for students who have just

graduated, find internships for them, not like everybody has

I suppose I am in the position now where I can still go and make a life

and I would like to stay here.

because we can't get a permanent job.

I am excited about going to university,

but the fact that I might be unemployed is kind of stressful,

because I really plan on studying hard and I can't do anything

about it, I just have to go to university

Unemployment is affecting a lot of society.

In the townships, people cannot afford to go to college.

Those were the views of ordinary South Africans.

Our panel is made up of the editor of the Business Day.

Sitting next to him is Abraham Sarfo, a technical

advisor at the new partnership for African development.

His aerial focus is rural development and how

And finally, Magdalene Moonsamy, the treasurer

general of the economic freedom fighters.

It is a political organisation that is in opposition

You've heard what South Africans feel about the unemployment issue.

My sentiments are the same. Unemployment is too high.

People are desperate and they are losing hope.

Visiting other countries on the continent,

I think there is a lot of subdued sentiment that came across.

The reality is that people are revolting.

We have passed the point of crisis and we are

The sentiment that it is no longer a crisis, some have said

It is correct, because we have a generation of young people

who have never worked, who don't know what it is like

And that has long term consequences for the economy.

Different heads of state recognise the issue.

Even at the last summit that was held in Johannesburg,

we at Nepad wanted to address this issue.

Do you believe the leaders have understood

In the African continent, 300 million young people will enter

You are going to have a doubling of the population

Can you imagine the magnitude not only demographically,

I don't believe this is a problem of South Africa,

it is said that nearly 9 million people are out of a job.

That is about a quarter of the workforce in the country.

Are those statistics conservative or accurate?

Those statistics are conservative in my view, because such

is the narrow definition of unemployment that

there are millions more who have given up looking for work

because the prospects of work are virtually

Until you acknowledge the full scale of the problem,

we will never have adequate responses.

Across the African continent, we are told that we are seeing

There are nearly 1 billion people living in Africa.

I cannot definitely say this number or this percentage,

I have travelled across the continent to almost 25 capitals,

and I see the situation in South Africa in most

Magdalene, the trade unions say unemployment in South Africa

There is unemployability and there is unemployed.

When you are discouraged or you are a graduate,

you still don't have a job.

It doesn't make you more or less employable.

That is one of the problems we have with the semantics.

Trade unions are not necessarily incorrect.

Official statistics are definitely incorrect.

We went in 2008 from 31% to almost 38% now.

I think it is greater if you have to give the expanded

Half of those who can't find jobs are said to be people under the age

So when we talk about unemployment, should we use generic terms,

or should we hone it down to youth unemployment?

We should hone it down to youth unemployment,

Part of the unemployment problem is the inability of the education

system to produce somebody who is sufficiently trainable

for a sustainable job in the real economy.

Without segmenting the unemployment, we will never have a response

Across the African continent, yes, young people

are perhaps the most disaffected, but when you look

at the poverty statistics, it is women

Can we really just focus on a category of people?

I think it is good for statistics purposes to categorise.

But I like the way the definition is now on unemployability.

Like he said, how do we link it to the courses and the students?

We could have youth who are unemployed, but how

They say two thirds of people who can't find jobs don't

Is education at the root of the problem?

Education is a significant contributor to the problem.

I don't think on its own, it is the root.

There is the other half, which is industrial and economic

policy responses by governments to the problem.

Does any politician stand up and say in the context of South Africa

or any country with similar conditions on the continent,

we need to stimulate the parts of the

economy where people who are unskilled and do not

have a high school qualification can find

Talking about unemployment in broad strokes and

talking about industrial policy in broad strokes,

unfortunately hasn't worked and will not work.

There is definitely a structural problem.

We have one of the weakest macroeconomic policies that you can

find, and you see it in the lives people are leading.

If you take artisans, for example, 50% of artisans

enter institutions and fall out of the system.

They get grabbed into the private sector, given a stipend

They are told by the time they finish, they will earn

This is a duplicate of the jobs fund.

And the jobs fund was created with the

intention of intervening in the unemployment crisis for young

It enriched capital. It exploited young people.

9 billion rand were set aside in 2011.

Six years later, there are only 4.7 billion that have been used.

Ask yourself, how many permanent jobs have been created?

What is lacking at a policy level are any ideas to grow

new sectors of the economy in line with the kind of skillset

Magdalene, when the economic freedom fighters were

formed, it was responding to the agitation on the ground

by young people, wanting jobs and the right

to a free education, wanting a better life.

Please describe for me the levels of youth frustration and despair

Youth in South Africa is between the ages of 14 and 35.

But 63% of the unemployed are under the age of 25.

You have the rebellion because at a time when

leadership should respond adequately to what the majority

of the population are saying, it moves in another direction.

We will be discussing solutions in a short while.

Firstly, whilst we have been focusing on the unemployment crisis

in South Africa and indeed Africa, what is the situation

For this week's talking point, our comedic consultant

has been looking at unemployment and youth issues

in other parts of the world, but more importantly,

he has been looking at the future prospects of the job

On this week's talking point, how do young people of today find

So what are the job prospects for this generation of young people?

Or youth, as the authors of international reports

refer to the 16 to 24-year-old age group?

37% of the global unemployed are youth.

Two out of every five economically active young

people are either unemployed or working, yet living in poverty.

Globally, for the last 20 years, the youth unemployment rate has

consistently been almost three times that of the adult rate.

In North Africa, youth unemployment increased

In the Middle East, the figure was 28%.

In Europe, in two thirds of countries, 20% or more

The subject of youth unemployment has reached

This year, the World Economic Forum published a report entitled

Last year, the UNFPA told us there are 1.8 billion young people

between the ages of ten and 24 in the world

There are 70 countries where 50% of the world are under

It is the developing world where you have

So where are these 1.8 billion young people going to get their jobs?

One thing is for certain - a lot of them

won't be doing the same jobs their parents and grandparents did.

Not least because the technology that is

inside and will succeed devices like this is going to do away

But how do we even know what jobs we should be training them for?

Maybe we will need conflict resolution as the appliances

in the internet of everything become sentient and start

Now, fridge, we need to work together.

I know there were difficulties, but the cooker

has apologised and we should move on.

Unfortunately, though, because of inequality,

not every young person will be able to get the job of their dreams.

If you are a young person and you have the energy

and ambition and you want to change the world, there has never been

If people can benefit from really elite educations and environments

that allow them to realise those ambitions, to start a company and do

If you find yourself outside that world of very

good education and an environment that allows you to flourish

and realise your ambitions, it can feel

people who are looking for real jobs right now.

And that is creating real frustration.

Governments all over the world would ignore that frustration

That was his take on the future of work.

If you want to see more films, log on to our website.

Our panel is now joined by a very popular DJ,

Mo Flava, host of the morning fix on Metro FM.

You meet them in clubs and talk to them via social media.

The youth in South Africa recognise that education is important.

Everybody knows we have to go to school.

We have to study something in university.

Experts will tell you about 800,000 jobs

are available in the private sector,

if there are so many jobs in the private sector,

Why are they telling us that even after my

engineering degree, I don't have experience?

Are they frustrated, despondent, or are they angry?

There is a lot of frustration with those who are more

educated and perhaps learned, having gone through the university

system, will get the feeling that the

government is not doing enough, so there is anger

I have heard leaders say young people, seize the mantle,

carpe diem, be the solution to your problems, be entrepreneurs.

Entrepreneurship is how to solve the problem.

Does that message resonate with young people?

I was watching the vox pops earlier, and it is interesting how one

of the young ladies said, I have to find a job.

I am not hearing enough young people saying,

we are being taught the idea of being entrepreneurs,

It is more like you need to be out there to find a job.

Hence, the shift in mindset should be that perhaps we need to start

instilling a stronger sense of entrepreneurship.

A shift in mindset, says DJ Mo Flava.

Is that a shift in mindset in the young

unemployed, or a shift in mindset in business and government,

those that can create the jobs needed?

We normally find interventions which bear no

relation to the situation on the ground.

So you will find an initiative linked to tourism, but there is no

road that goes to the tourism asset, and roads and

infrastructure are corridors of economic activity.

When you tell young people to be entrepreneurial,

they cannot meaningfully do business.

The second thing is a regulatory mindset to policy-making.

The business registration act in South Africa says anybody

who is even hawking something on foot

needs to register at a local authority, and any government

official can stop them and ask for a licence.

The question is, what are you doing? This is how people survive.

You should not constrain this activity, but encourage it.

These are shift in mindsets that young people

often are asked to do things for which there is no

infrastructure, and that is not helpful.

And if you are going to encourage young people, train them,

give them access to resources that they need.

If the infrastructure is not there, you

The focus of infrastructure needs to shift and

It is an interesting issue, because we are seeing higher rates

of urbanisation in South Africa and the

general feeling is that people want to leave the rural areas

to pursue economic opportunities in the city.

Somebody needs to make agriculture interesting, even sexy.

Yes, and that has been one of the problems we have,

getting young people into agriculture.

The issue is the modernisation of agriculture.

That is what the comprehensive agriculture programme

Make agriculture modernised, infrastructure-wise.

People do not want to go into the production level.

There are areas which have not been opened up, and if that space

is open, young people will have a lot of opportunities

and the entrepreneurial abilities will then come up.

Let's talk about the future, really and truly.

If there isn't a quick intervention, are we

likely to see, in sub-Saharan Africa, the kind of Arab Spring that

Are we likely to see young people leading a revolution because of this

youth unemployment issue and the despondency that

We are seeing regime changes, albeit democratically,

We might not have a so-called Arab Spring in the violent way

it was, but in the more systematic ways, in countries

where you have governments that are seen to be very

strong, they are being removed them democratically.

And most votes are coming from the young people.

It is something that governments need to

take into consideration, how to address this issue.

Mo Flava, how are young people channelling their energies?

Are they going to confront politicians or just complain

Well, we have seen plenty of examples of both.

The power of social media, students have

said the fees for university are too high.

And we have seen young people taking on titans in the world of politics,

at a political or government level, even as far as the union buildings.

For me, it spells a sense that we believe we can bring

Gentlemen, very briefly, if I could ask you for one

intervention that could help address the problem,

He said what I was going to say, but there is another,

I think explaining to young people what it means to be in the working

world, that it is not just about jobs, sometimes

it is about being the person that creates the job.

The editor of Business Day, Abraham Sarfo,

technical advisor and DJ Mo Flava Tsiki from Metro FM.

You have been watching Talking Business, from

Please note that next week's edition of the programme will be coming

to you from London, hosted by Tanya Beckett, as she looks

at the issue of cyber security and what businesses need

From South Africa, thanks for your time and goodbye.

Stormy day across parts of the UK today. More storms and scenes like

this recorded in Dorset to come over the next few days. Heavy rain has