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The possibilities of investing in highly talented unemployed young people

The possibilities of investing in highly talented unemployed young people - by Andrew Levy

Opinion piece by Andrew Levy (YALI Mbewu Fellow)

Youth unemployment has become the latest South African buzzwords. Everyone is speaking about it. Everyone is also trying to create their own incubator, solution or PR campaign and lining up their unspent skills development money and CSI funding to train unemployed youth.

On paper this sounds like a fantastic idea and, while there is a lot of value in it, perhaps I could offer a slightly expanded view based on my experience in this sector. My name is Andrew Levy and I am a YALI Fellow, yes one of those idealistic whipper snappers that pretends to know all the answers without much dirt on his sleeves. The bad news is I’m about to drop the ‘Y’ in front of my status as I approach my mid to late 30’s. The good news is that I have all my hair intact and still some of my idealism.

All of the above was to signal to you, the reader, that I have been around the block once or twice. I have spent the last 10 years in youth related matters and, specifically, youth unemployment and have come up with three major insights which I thought I would share with you.

There is talent in youth unemployment

Not just a little but a whole kitchen sink of talent. Quick thought experiment while you are here. When I say the word youth unemployment what do you think of? Don’t be shy or PC, just be honest. Most of you probably would have come back with some of the following adjectives: Black, uneducated, under-resourced, from a rural or township background, poor English, broken family and hopeless. Of course, when written in simple un-PC fashion like this, the mind starts to get to work and wonders how 3.3 million people could all be the same. Of course, and you are right, they/we are not all the same. The statistics do not allow for the richness behind the numbers, which is truly wonderful when you start to wade through them. The truth about youth unemployment is that whilst there are a lot of young people who are unemployed, there are many who are also seriously talented, even partly skilled and, perhaps, even have some experience. However, they are locked out of the economy due to the issue of access.

Most of the young people we work with today have tried some kind of tertiary level education but have fallen out of the system due to lack of resources or support.

This is brilliant news. It means there are literally hundreds of thousands of young people in that 3.3 million youth unemployment stat that just need a little bit of support, skills training and access to turn their real potential into working ability.

What about the 54% of employed youth?

The stats vary from report to report, but generally South African youth unemployment is as high as 46%. Have you ever wondered what the employed youth statistics comprise of? Well, unfortunately, this is some of the not-so-good-news. There are hundreds of thousands of young people included in that percentage that are, what is commonly termed, under-employed.Under-employed young people are those that traditionally work in a call centre, retail, hospitality or till jobs. These jobs are often low skilled, temporary and have very little growth potential. Close to 100% of the young people that I work with have been under-employed at some stage of their life. There’s huge amounts of potential wasting away because they need to bring in that R3,500-R6,000 a month in order to deal with life and black tax.

This massive spotlight on youth unemployment currently has the danger of fueling the under-employed bucket so as to bolster youth employment stats. Instead of changing the needle on youth unemployment, all that occurs will be a cue shift of who gets to be under-employed first.

Low skilled jobs are the ‘poverty of imagination’ of the middle class

At Umuzi, the organisation I am involved with, we believe in high-value jobs. That’s our thing!  We have built a community that supports highly talented unemployed youth and assist them in gaining access to high-value jobs in South Africa. You can read more at www.umuzi.org

We have collected the numbers and they are alarming. Based on statistics from Pay Scale and a very clever statistician at Umuzi, we were able to take the data and come up with a net present individual and societal value of low-skilled jobs versus high-value jobs.

The example can be seen when comparing call centre agents to software developers growth path. Call centre agents will, over their lifetime, earn close to R5,500,000, assuming they stay in work the entire time over 40 years. They will contribute a taxable amount of R447,000. On the other hand, software developers conservatively will earn over their life time R23,000,000 and contribute a tax amount of R6,000,000.

The value add to society for investing in high-value jobs is exponential, namely at least five times more.

Now some people might say, Andrew slow down there son – your youthfulness is getting ahead of you! Of course, we know high-value jobs are better but that shouldn’t take away from the value given to a young person for any kind of job.

There is truth to that argument and I for one certainly do think that having a job is better than having no job. The concern for me regarding low-skilled jobs are twofold.

They don’t provide as much dignity as World Bank reports might suggest. You only need to go into your local shopping mall to realise how many low-skilled jobs you ignored before you even get to the checkout counter person at Woolworths, where you just asked for plastic bags and told said person “no I don’t have a Woolworths card” to know this. The guard in the parking lot, the person coming to ask you if you want your car washed, the cleaners having a smoke break in the parking lot, the man washing the windows of the inside facade facing the parking lot, the packers of vegetables inside your favorite high-value store, you didn’t even see any of them did you? Of course not, we all don’t, because there is no dignity in those jobs. The other massive problem is jobs that are becoming obsolete.

Naked, a new insurance company underwritten by Hollard, boasted online just a few months ago how ‘everything is done through the app’. There is no call centre or quotation assessment centre, just an app. All those low-skilled jobs that were previously part of the traditional insurance system are now gone and they are not the only ones. Corporates are experimenting with smart call centres, machine learning responses and artificial intelligence integration to bring down their costs and the labour pools.

What does that all mean? A bunch of young people who were employed will now be out of a job with no further upskilling or reskilling, simply a line item on their CV that reads ‘call centre agent’. That’s why we need to demand more of ourselves then simply saying a job is better than no job.


So what’s the good news?

The good news is people like Umuzi are training unemployed youth in an innovative way to obtain high-value jobs. These are the future coders (front end and back end), data analysts, UI/UX designers, business analysts and multimedia experts. We believe these skills will make up the product teams of the future. That is why we are training highly talented young people to enter into junior positions in these roles.

Our aim is to continue to be demand-driven and learn what the world of work and industries of the future look like and prepare our young people for that space. These jobs will change in the future and, likewise, so will the skills we offer.

We believe that the skills shortage needed for high-skilled jobs can be plugged into if we as a nation invest in our talent pipelines.

We are growing

Our alumni which is now 350 people strong has an incredible 82% in high-value jobs currently, and we are growing this year.  With the help of corporate SA, we are looking to bring 300 young people through our programme.

The energy when working with young people who are highly talented but, up to this point, have been locked out of the economy is infectious. It’s like walking into the office everyday and watching Simphiwe Tshabalala score that incredible goal, everyone now believes that they can do it. The only difference between Bafana 2010 and the young people in our 2018 programmes is that they will do it.

In closing I would like to simply say that youth unemployment and access to high-value fit-for-purpose education are the issues of our time. This is our struggle. It is a struggle that if not done together, and taken up by all, will be lost in the idealism of those individuals who chose to imagine it’s possibility and the young people who continue to live that reality.

We all can make economic freedom happen in our lifetime if we choose to.

Opinion Piece by Andrew Levy, Yali (Nomvula class) and Co-Director Umuzi.

PS – Please feel free to come and visit Umuzi to see what we are up to and to experience the magic of South Africa’s youth potential.  And, if you are interested in working with us or supporting young people in our programmes please get in touch at andrew.levy@umuzi.org

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