As young people hustle their way out of poverty, we need to help them make it less precarious

Young people demonstrate resilience throughout their zigzag pathways in and out of work. But, this Youth Month, as we reflect on young people’s resilience, let’s not simply celebrate their ongoing ability to bounce back from the ongoing hardships they are forced to endure—as if resilience were a trophy against adversity. Let’s instead move from celebrating individual resilience to rewiring the system towards greater support—and let’s instead use resilience as a clue to shed light on exactly where and how to invest to rebuild our economy.

While the latest Stats SA Quarterly Labour Force Survey results suggest that the number of employed young people has increased for two consecutive quarters, employment remains considerably lower than pre-lockdown. Additionally, the economic recovery continues to favour contract jobs over permanent employment as companies hedge against further uncertainty.

Globally, slow job growth, accompanied by a high number of labour market entrants, has meant that young people have for a long time been engaging in informal ‘side’ work to make ends meet. Across the African continent, the concept of a ‘side hustle’ is not new. Around 63% of the labour force in Africa is involved in some type of self-employment. Harambee’s analysis suggests that there are about 1.2 million young micro-entrepreneurs in South Africa’s informal sector—a number that is set to grow due to circumstances that demand ‘resilience’.

We urgently need to prioritise growing sectors that hold promise for young people—such as the Global Business Services sector, which continues to buck the youth unemployment trend. But we also need to fundamentally rewire our systems towards greater inclusion and less precariousness for young people—such that the burden of resilience is not shouldered by them alone.

Young people enter the informal sector out of necessity and opportunity. Forty percent of participants in our research described that they couldn’t find a job and that hustling was their only option. At the same time, 36% had entrepreneurial aspirations or saw an opportunity in the market. Our data suggests that young micro-entrepreneurs earn an income that is both irregular and volatile, with monthly figures ranging from as low as R200 to R4,000. Providing services such as braiding hair or offering digital support earns young hustlers a lot more profit than selling goods such as snacks and clothes.

There is also a sense that hustling offers a bit of flexibility. For example, research on young people in Zandspruit settlement by Wits’ Hannah J. Dawson suggests that “hustling had the advantage of giving youth more control over what they did with their limited resources.”

However ambitious their intentions, young people face a range of barriers that prevent them from entering micro-enterprise. Structural factors such as lack of suitable premises, equipment or perception of insufficient customers hold youth back. Young people also feel insufficiently encouraged by friends, family or community members who make them believe it is a bad idea; they describe that people in the informal sector are often judged, looked down upon or not taken seriously.

So while hustling represents an essential source of resilient income for young people, we need to help make their income more consistent and less volatile and reduce barriers to entry with intentional investment and support.

Our schools, financial institutions, and government have to reconfigure themselves to adapt to the world of the side hustles, making these opportunities work for young people.

Firstly, education and training institutions must shift to keep up with young people’s lived reality. Schools and colleges need to offer more entrepreneurship training and financial literacy and actively encourage side hustles as part of their curriculum—both to encourage savings and to earn profits but also to avoid predatory lending behaviours that can entrap them further.

Secondly, financial services institutions should keep up with the times. There are many examples of young people who struggle to access financial services products that suit their circumstances, whether loans and start-up capital or products to improve their business productivity. But, again, these products need to be accompanied by the basic financial literacy training a young entrepreneur needs to sustain and grow their hustle. Companies like A2Pay and Yoco plug in many of the gaps in our informal economy, enabling their growth with much-needed payment solutions. However, we need a lot more investment and innovation in this space.

Lastly, public institutions and labour market platforms need to reconfigure to this new normal. Outdated ideas inform everything about labour market institutions of what constitutes work.

Consider Tshepo Napyane, who matriculated in 2012 but couldn’t complete further education due to a lack of funding. So he moved from one short-term job to the next while looking for permanent work. He eventually opened a car wash business in his neighbourhood. “The reality is that jobs are scarce, so creating another source of income is a great way to keep you active while looking for a job,” he says. On an average day, he washes five cars. He uses his money to buy data so he can continue to apply for opportunities online and contribute to his family’s income.

Can you imagine if Tshepo, and the millions of young South Africans like him, with drive and passion, could access the support they need to grow their good ideas into something more sustainable, rather than thinking of their hustle as a stopgap until something better comes along? What if they could access the right investments at the right price – where they are – to turn their precarious hustles into thriving small businesses?

Unless we listen to our young people’s challenges, the system will continue to entrench the barriers to entry that prevent would-be entrepreneurs from ongoing economic participation.

Resilience alone in the face of crisis is not what will get us through. It needs to be coupled with intentional investment and support to address the lived reality of our country’s youth. So instead of simply celebrating resilience as a trophy against adversity, let’s use it as a signpost, pointing out where we need to actively support and invest in helping our young entrepreneurs who can help the country bounce back to economic sustainability.

Source: This article was published on page 23 of the Mail & Guardian print edition and online at this link https://mg.co.za/opinion/2022-06-27-turn-side-hustles-into-full-time-work/. Published 24 June 2022.