INSIGHT 1

There are many ‘gates’ that keep youth out of jobs. We need to widen these gates, without lowering the bar.

Apart from the record matric pass rate of 2024, another record was the 40.9% bachelors pass rate, representing 283 000  youth who can now apply to enter university.  These are some of the lucky few who make it through the ‘gates’ and whose chances of getting employment are significantly improved.

But while matric matters, it can also act as an unfairly narrow ‘gate’ into the labour market, and one that also keeps talent–particularly young women and people with disabilities–out of the labour market. A person with a degree is  twice as likely to be employed than a person without a matric and even matriculants have an expanded unemployment rate of 51%. When employers rely purely on these proxies, Harambee’s experience suggests, they might miss out on thousands of candidates who are better suited to the role but do not have the qualifications – matric or otherwise – to even get noticed.

Our experience suggests that many entry-level jobs can be performed easily by those with a matric, and in some cases even less than this. While matric is indeed a useful gate for university access, the labour market may be different. We need employers to widen these ‘gates’ to entry level jobs and to help them do this, we need better signals of competency, better matches, and we need to actively advocate for them to hire these youth, by showing evidence of returns.

Firstly, we need assessments for entry-level work that are independent of school results. These are focused on the actual abilities needed to perform work. Counting money, for example, does not need an employee to be able to solve algebraic equations.  Harambee has over a decade of experience in administering alternative assessments and tools that focus on problem-solving and logic, such as the fluid intelligence test called the Concept Formation Test which formed part of the TRAM Psychometric Battery. Fluid intelligence refers to the ability to reason, think flexibly and solve abstract problems. This ability is considered independent of learning, experience, and education. But these were expensive, requiring face-to-face and lengthy assessments to demonstrate potential. Recently, however, our platform innovations have been able to scale our approach.  Partnering with assessment experts, Harambee developed shorter, mobile-friendly tests to identify work seekers with potential for higher complexity work.

This mobile problem solving assessment on SAYouth.mobi, revealed that 20% of those performing poorly in matric maths show good enough raw problem solving potential to be considered for entry level admin roles. This suggests that 20% more young people who may have not made it through other ‘gates’, can be considered for roles reserved for those with higher marks: an example of widening the gate without lowering the bar. This is also significant for another reason: it shows how technology can help scale our inclusive assessments. We have already conducted 170,000 such tests in just a few months, averaging around 1,500 per day which in the past would have taken two years, four full time staff in in-person facilities, and R500,000 in transport stipends to do a similar number of the previous generation of assessments. We will need more employers to partner with us to trial these new ways of assessing potential–and to build  inclusive onboarding programmes to support this potential.

Many jobs can be done well with just a matric and an example of these are found in the Global Business Service (mostly call center) industry, which has grown and benefited from hiring less experienced youth and has seen high returns on investment. These include cost savings due to reduced attrition and absenteeism and higher performance (Everest Group, Impact Sourcing report). On SA Youth, we try to offer more listings that do not require a matric. In a sample scan of private sector job postings online, fewer than 3% of job listings (predominantly in direct sales and retail) are explicitly open to those without a matric. The SA Youth platform has disproportionately more – at least 10% of private sector listings do not require matric – and if we add public employment programmes, the percentage of jobs not needing matric on SAYouth would increase to 40% (half of the positions in the DBE school assistant program did not require a matric).

By dropping unnecessary qualifications and focusing instead on job-specific requirements and alternative assessments, we can widen the ‘gates’ that currently restrict access to the labour market. As a consequence, we can increase the ready talent pool available to employers that are a better match.

Figure 1: New and wider gates into the jobs of today

INSIGHT 2

All forms of ‘safety nets’ are needed and, if well deployed, these can serve as trampolines to other work.

Despite recent and significant upticks, our long-term analysis of QLFS data suggests that the economy has been shedding jobs for youth since the 2008 economic crisis, moving from 6,4 million employed youth to 5,9 million employed youth. We are barely back to COVID-19 levels of youth employment which were not great to begin with. In the absence of overall macroeconomic growth, ‘safety nets’ and initiatives like Public Employment Programmes (PEPs) are not just an option, they are a necessity.

But ‘safety nets’ often come under fire for being only that: ‘safety nets’ that do not stimulate economic growth. This is a false notion as these ‘safety nets’, when well deployed, can actually act as trampolines to opportunity as the economy recovers. South Africa deployed many ‘safety nets’ and welfare programmes that prevented millions–particularly its youth, and women–from plunging into poverty over the past two years. We outline the impact of two in particular.

The Social Relief of Distress (SRD) grant of R350 per month to those without income has led to major reductions in food poverty (Orkin et al, 2022). Studies show that the impact of the SRD has reduced the number of people living below the food poverty line by roughly two million people. There is increasing evidence that these grants also have notable, albeit small, labour market effects. These studies suggested that receiving the grant increased the probability of employment by three percentage points, and that these employment effects were driven by effects on wage employment in the formal sector. The study also showed a small effect (+1.2 percentage point) on the probability of trying to start a business. Harambee and our research partners continue to examine the job search activity and outcomes of grant recipients to be able to add to the evidence base that these safety nets can have positive labour market outcomes.

In 2020, the South African government’s launch of PEPs was a direct response to the COVID-19 pandemic. The Presidential Employment Stimulus has directly created 1.8 million jobs and livelihood opportunities, of which the Department of Basic Education’s Basic Employment Education Initiative (BEEI) has been well documented for being inclusive. The initiative employed about 245,000 young people per phase to assist schools across the country, and it has recently been extended. With over one million placements of young people at 23,000 schools, the BEEI is the largest youth employment programme in South Africa’s history.

But these programmes go well beyond the function of providing ‘safety nets’ to youth without any options. These “circuit-breaker” programmes have had ripple effects beyond the placements themselves. The skills gained from these programmes such as administrative skills, communications, and teaching skills have proven themselves transferable and have given youth a step up into other PEPs and job opportunities. Many of these opportunities have created pathways into other related opportunities such as tutoring, administrative assistants and IT technicians.  On SA Youth alone, those who had undertaken the DBE Phase 1 programme were on average 7% more likely to access jobs in admin and education related fields, compared to those who applied but did not get the job in Phase 1. This might be because they were able to bank some of the admin skills they learnt during the programme. We are still evaluating the impact of these programmes on labour market transitions overall and do not yet have evidence of systemic shifts in labour market outcomes but this early data suggests an interesting shift in the type of jobs that participants access after the programme.

Furthermore, these programmes keep our youth engaged and productive. BEEI positions drove up traffic on SA Youth 30x, from an average of 2,000 visits per day. Why is this important? There is initial evidence that greater engagement on platforms correlates to higher employment outcomes: youth who spend three days on the SA Youth platform in any given period have a 10% higher chance of employment over those spending one day on it.

Early evidence suggests that well-run PEPs can stimulate the economy, and springboard youth into other work opportunities, suggesting that safety nets can, in fact, become trampolines, in the right circumstances. Research by the Learning Trust evidenced that the Social Employment Fund programme enabled over 6,000 work opportunities, and in addition to increasing household incomes, improved work readiness, increased access to other concurrent opportunities such as micro-enterprise, and increased access to opportunities within the host organisations of the programme.