Momentum Metropolitan Foundation and Lulalab collaborate to tackle youth unemployment

South Africa’s unemployment rate has hit another record high. Statistics South Africa (Stats SA) Quarterly Labour Force Survey for the fourth quarter of 2021 reveals that the number of unemployed people increased by 278 000 to 7.9 million in the fourth quarter of 2021 when compared to the third quarter.

For the fourth quarter of 2021 unemployment came in at 35.3% of the labour force, the highest level since the start of the statistics agency’s quarterly labour force survey in 2008. To add insult to injury, the youth unemployment rate is even more dire as it remains at a staggering 66.5%.

According to Nkosinathi Mahlangu, Youth Employment Portfolio Head at Momentum Metropolitan Holdings this trend will continue unless we swiftly and effectively empower our youth to build a future for themselves. “What if there was a better way to develop, nurture and place the young talent that exists in our own country, while curbing our rising youth unemployment at the same time?” he asks.

While bursary and scholarship programmes exist that seek to help talented and motivated youth who may not have the resources necessary to secure a good education, Mahlangu says many young people are unable to find a job once they graduate due to their lack of experience. “The dreaded ‘experience gap’ is an age-old problem faced the world over, but in South Africa, the need to bridge that gap has become critical to our socio-economic survival.”

Mahlangu says the Momentum Metropolitan Foundation (MMF) has established a strategic response to youth unemployability and has partnered with the non-profit Lulalab, to roll out a scalable youth employability and small-to-medium enterprise (SME) booster impact assessment study. The project aligns with the current imperative to create new jobs within the SME sector.

The project aims to provide extra resources for SMEs to get their businesses back on track and give young jobseekers the chance to gain experience and long-term employment through internships. This is a proven pathway to sustainable opportunities with skilled, tested and experienced candidates. In this way, it can support youth development and create a potential talent pipeline that can plug into the skills gap.

“This programme aims to implement an intensive, targeted intervention that will help unemployed youth obtain working experience that they wouldn’t have ordinarily been able to attain,” says Mahlangu.

He says the pilot study will give 80 youngsters a boost at launching successful careers.

Additionally, the initiative aims to stimulate SME growth through providing the businesses with human capital resources, already funded by a third party. This will increase company outputs, service delivery and efficiencies, as well as, addressing the youth unemployment crisis in South Africa. At the end of the project Lulalab will be able to quantify the impact on permanent absorption of interns after their 12-month internships have finished and assess the perceptual impact of internship on business growth.

According to Mahlangu, “Internships are recognised as one of the best mechanisms available to stimulate job creation and are an effective means to promote the inclusion of unemployed, inexperienced youth into the formal economy, further bolstering socio-economic development.”

He believes this initiative has simultaneously encouraged small businesses to offer internships, thus contributing to decreasing the levels of youth unemployment in the country.

Errol Freeman, CEO of the Lulalab Foundation says, “Small to medium sized businesses can be a valuable part of the unemployment solution in South Africa — by offering real life work experience to young people, they are actively participating in job creation”.

A country with increased levels of employment fairs better on all fronts. Increased spending power means a thriving economy and a more optimistic life for all citizens. Small businesses who host interns can increase their operational capacity and profitability, thereby increasing the likelihood of creating even more jobs in the long-term.

“Many companies do not have the capacity or the resources to upskill juniors. Of the forecasted roles, it is believed that more than half of these roles with some form of intervention and upskilling could be ideal employment opportunities for youth,” says Mahlangu.

He adds, “If we don’t come together to champion our young people and help them leap over this chasm. By shaping a local market with local skills, we can’t then grow our economy from within and build an industry that rivals that of our first-world counterparts.”

If more organisations pooled their resources and found the right partners to do this, then our country would be fast on the way to a more prosperous and hopeful future.

Freeman is calling for co-funders to help accelerate inclusive youth employment and stimulate small business growth in South Africa. “We invite funders and corporates to get in touch. With your help we can increase project scale to place additional youths in SMEs, in order to scale project outcomes and increase sample size for better resultant impact metrics.”

Both Lulalab and MMF are confident that if this model were to be replicated at scale, it could achieve systemic change in the way internships are managed and create effective, inclusive pathways to jobs for inexperienced youths. “This would provide a desperately needed boost to small businesses that, at scale, can have a significant impact on South Africa’s GDP growth, further stimulating the economy and creating even more jobs,” concludes Mahlangu.