Learnerships Could Be the Key to Unlocking Job Opportunities for SA’s Youth

The fact that South Africa now has the world’s highest unemployment rate must be the most unwelcome of all records. According to official data, the unemployment rate, which includes people who have given up looking for work, increased to 44.4 percent in the second quarter of 2021. The reality for our youth is even worse, with some estimates claiming that up to three out of every four young people are unemployed.

The majority of these young people face the problem of being effectively shut out of the economy. They’re trapped in a vicious cycle: they can’t get jobs without skills and experience, but they also can’t get those skills and experience if they don’t have a job.

Without a doubt, business plays a critical role in addressing the country’s unemployment and skills gap. Simply put, we must take the lead in addressing inequality by providing vocational education, reskilling and upskilling, and fair wages to as many young people as possible.

That is where South Africa’s burgeoning global capability center (GCC) and business process outsourcing (BPO) sectors can make a real difference in providing decent work for young people. The South African government hopes to create 100,000 new jobs in the sector by 2023, and 500,000 by 2030. The vast majority of these jobs will be filled by young people.

The opportunity exists. South Africa – and, indeed, the entire continent – are massive BPO hotspots. South Africa’s BPO market is expected to reach US$3.6 billion by 2027, growing at a 13.2 percent annual rate during this time period. According to the Ryan Strategic Advisory BPO Survey, the country is also the most appealing offshore customer experience delivery location in the world in 2021, ahead of India and the Philippines. That’s a record we can support.

We have the raw material as well, in the form of our youth. We have a sizable regional market opportunity, substantial cost savings, sophisticated infrastructure and an enabling environment, strong ICT and digital capabilities, and a solid foundation in contact centers and niche domain areas. What is required now is to provide our youth with the necessary skills and experience to go out and seize the opportunity.

TransUnion’s virtual GCC in South Africa is piloting a recruitment model that uses learnerships to build what we call our “bench” – additional staff who fill in when people are absent or on leave. We’re looking for unskilled learners to work on year-long contracts, during which time they’ll gain certified qualifications and a valuable year of experience for their CV. We hope to hire them as full-time employees after that year if they are good at what they do.

The government’s support is also critical. The GCC sector in South Africa competes with countries such as India and the Philippines, where labor costs are frequently lower. Government grants and subsidies play an important role in ensuring South Africa’s competitiveness in the sector. Driving youth employment and education is also beneficial to businesses: companies that hire learners after their year-long learnership receive absorption points for their BBBEE scorecard.

It’s a model that’s gaining traction: at TransUnion, several teams, including global facilities, HR, finance, and IT support, have taken on learners.

The significance of developing programs like this cannot be overstated. According to World Bank and ILO research, youth employment programs have long-term positive effects on skill development, entrepreneurship, and economic development. In other words, facilitating the entry of young skilled workers into an economy’s productive sectors increases the overall productivity and competitiveness of the economy.

“Decent work for young people unleashes multiplier effects throughout the economy and society, boosting investment and consumer demand and ensuring more stable and cohesive societal ties across generations,” said the International Labour Conference in 2005.

The bottom line is that developing youth employment programs is beneficial to us. It’s good for our country, our economy, our businesses, and, most importantly, it’s good for our youth. You only need to look at our own GCC recruitment website to see how many opportunities the sector is creating. We now have the chance. We can’t afford to let this opportunity pass us by.