Youth Employment Strategy Presentation to Portfolio Committee on the Youth Accord

1. Economic Development Department Youth Employment StrategyPresentation to Portfolio Committee on the Youth Accord 18 June 2013

2. ECONOMIC DEVELOPMENT DEPARTMENT Part 1: Background and context

3. The Youth Employment Challenge • Youth unemployment is a global challenge with economic growth unable to create sufficient jobs for young people who enter the labour market • This challenge is deeper in countries with a population profile weighed towards young people, though even countries in Europe with a greater proportion of older workers, are experiencing high and growing youth unemployment • South Africa has a very youthful population, with large numbers of new entrants to our labour market every year • More than 1,6m new youth jobs were created since 1994 • Whilst the economy created 199 000 new jobs in the 12 months ending 31 March 2013, few of the jobs were filled by young people

4. The Youth Employment Challenge The latest statistics on youth unemployment are as follows (March 2013): The unemployment rate for young people is: 53% for those aged 15 to 24 42% for those aged 15 to 29 36% for those aged 15 to 34. The number of young persons who are not in employment, education or training: 3,5 million aged 15 to 24 5,8 million aged 15 to 29 7,6 million aged 15 to 34. • The number of unemployed youth (defined as those actively looking for work and available to work) are: • 1,4 million youth aged 15 to 24 • 2,5 million youth aged 15 to 29 • 3,2 million youth aged 15 to 34. • The number of unemployed youth plus discouraged workseekers (who have given up looking for work) are: • 2,2 million youth aged 15 to 24 • 3,7 million youth aged 15 to 29 • 4,9 million youth aged 15 to 34. Note: Unemployment refers to those actively looking for work and available to work. The unemployment rate is based on this definition

5. Policy frameworks • New Growth Path adopted in October 2012 with core aim to create five million jobs by 2020. It identifies key jobs drivers, resource and policy drivers to attain this goal. It singles out youth employment as an area of special action, calling for • a multi-pronged strategy to support youth employment • rural, literacy, green and HIV-education youth brigades that will engage up to a million young people • measures to expose young people to work experience through internships in the private and public sectors • The National Development Plan (NDP) sets overall vision for socio-economic development which integrates economic, demographic, social, environmental and governance elements into a comprehensive framework. The NDP on youth: • better educational and economic opportunities, • focused efforts are required • Youth Accord sets joint commitments to prioritise youth employment and skills development by government, business, labour, youth and community organisations.

6. ECONOMIC DEVELOPMENT DEPARTMENT Part 2: Summary of the Youth Accord

7. Principles underpinning the youth accord The Youth Employment Accord was signed by constituencies on 18 April 2013, as a partnership to increase the level of youth drawn into skills, work exposure and employment in the public and private sectors. Social partners accept the following broad principles as basis for partnership: • Approach to youth employment is based on the common recognition that more jobs need to be created to ensure that the total number of South Africans employed is significantly stepped up, that the benefits reach many more people through sustainable, decent work opportunities and to avoid youth employment schemes that simply displace older workers. 2. A comprehensive strategy is necessary to grow youth and total employment including addressing the structural challenges such as poor skills, weak infrastructure, monopolies and cartels. • Interventions should be customised to reach different categories of the youth including those not in employment, education or training, the long term unemployed, youth in training programmes and those that are in employment. • A phased approach to the development, refinement and implementation of the Accord with three distinct phases: Phase 1: identifying areas of immediate action on youth employment to be implemented from 2013. Phase 2: identify additional actions on youth employment that are possible, revised targets where appropriate and scale up the programmes on youth employment, in an expanded and updated accord to be concluded in 2014. Phase 3: Commence discussions on the constraints in the economy that hinder greater job creation and inclusive growth, including structural features inherited from our past.

8. Key pillars of the Youth Accord Overall the Accord seek to create employment, training and self-employment opportunities for the youth. It rests on six key pillars or commitments, namely: • Improve education and training opportunities for the gap grouping between school-leaving and first employment: • Connect youth people with employment opportunities, through amongst others support for job placement schemes and work-readiness promotion programmes for young school leavers and provide young people with work experience. • Increase the number of youth people employed in the public sector, through coordinating and scaling up existing programmes under a ‘youth brigade’ programme coordinated with the National Youth Service Programme. • Youth targets set asides in particular industries, especially new industries where young people can be drawn in large numbers and should be progressively realised. • Youth entrepreneurship and youth cooperatives. • Work with private sector to expand the intake of young people, with targeted youth support and incentives approved by all constituencies.

9. Six pillars expanded

10. Follow up mechanisms and action plan • A Committee of Principals develops the Action plan which contains specific targets and timeframes to enable the roll-out of youth focussed employment programmes. • Roll out across the country the youth employment strategy which covers • Training, internships and apprenticeships • Private sector commitments and programmes • Youth brigades • Mechanism for coordination within government, based on identify a central coordinating department to bring together the various government youth programmes 3. A detailed report will be tabled within 18 Months (October 2014) on the progress that has been achieved. 4. Follow up set of commitments will also be developed, based on the lessons of the first phase.

11. ECONOMIC DEVELOPMENT DEPARTMENT Part 3: Progress to date

12. Progress to date • Budget Votes of a number of Ministries addressed youth development issues consistent with the Accord. This include the following Departments: Basic Education, Public Works, Social Development, Higher Education & Training, Tourism, Public Enterprises, Labour, Dti, Public Works, Rural Development & Land Reform, Energy, International Relations and Cooperation, Water Affairs and Agriculture, Forestry and Fisheries and Sports and Recreation. • Funding for youth entrepreneurship announced • IDC: R1 billion at concessional rates • Sefa: R1,7 billion for youth funding • Motsepe Foundation: • A PICC session on the Youth Employment Accord was held on 17 May 2013 to take steps to implement the youth target set aside in infrastructure projects. • The first meeting of the Committee of Principals took place on 24 May and agreed on a process to collate youth initiatives to be announced in June. • Bilateral discussions were held with business on contact with larger enterprises • A bilateral between Economic Development the National Youth Development Agency on 6 June 2013 to discuss coordination of small business enterprises effort between NYDA, Sefa & Seda. • A Presidential Youth Task Team held its first meeting on 31 May 2013

13. Committee of Principals • The Committee of Principals is comprised of three representatives each from government, labour, business and community including youth organisations. • Principal role of the Committee is to oversee implementation of the Accord, intervene where necessary and identify further commitments. • The Committee will meet quarterly to monitor progress and address obstacles to implementation. At its first meeting, the Committee agreed that each partner must submit initiatives that take forward the commitments of the Accord.

14. Way forward • By end of June, second round of key announcements are expected • Draft incentives document will be publicly released shortly • Publicise the new facilities through greater use of community meetings and road-shows • Strengthen working relationship between NYDA, Sefa & Seda regarding enterprise development. A Draft Memorandum has been devel • NYDA, Economic Development & Presidency coordinate, integrate & monitor state actions on youth (national departments, provinces, municipalities & state owned entities). First meeting in June to define coordinate strategy & monitoring and evaluation system. • Engagements held with a wide range of private sector companies which will result in announcements on actions they will take • Public agencies are now monitoring their youth programmes: the PICC has compiled a first report covering the largest state-owned companies • Trade unions have considered actions they can take to promote youth employment

15. Yes to the Youth Employment Strategy • The Youth Accord offers a constructive partnership opportunity between the social partners. • It is aimed at mobilising social partners around a common set of commitments aimed at: • Creating employment opportunities for youth in the private and public sector. • Supporting skills development, training and work exposure for young graduates and all youth. • Support youth-owned enterprises and cooperatives.