Call to fix SOEs to unlock jobs for youth

Cosatu's Matthew Parks said they were deeply concerned about the 60% youth unemployment rate.

Cosatu's Matthew Parks said they were deeply concerned about the 60% youth unemployment rate.

Published Nov 17, 2023


Cosatu has challenged the government to address the high rate of youth unemployment by fixing ailing state-owned enterprises (SOEs) as they remain a hindrance to economic growth.

Statistics SA announced on Tuesday that the unemployment rate had eased to 31.9% with young people, aged between 15 and 34, having an unemployment rate of 43.4% in quarter three, compared with 45.3% in the second quarter.

While there has been a slight decline in youth unemployment, Cosatu warned that far too many young people were not economically active and this has significant societal and economic implications.

The union’s spokesperson, Matthew Parks, said they were deeply concerned about the 60% youth unemployment rate, meaning that many young people who should be economically active are jobless.

The union has warned that a lack of job opportunities for young people not only affects their individual prospects but also the country’s potential to harness their innovation, skills and creativity.

“Youth unemployment is a ticking time bomb and needs to be tackled by moving with speed to fix the obstacles hindering economic growth, in particular to ramp up Eskom’s maintenance programme and efforts to bring on board new generation capacity.

“Much more needs to be done to secure our railway network and modernise our ports which are key to ensuring mining, manufacturing, and agricultural products reach their destinations and workers can get to work on time,” Parks said.

While the government seeks to rebuild the state and grow the economy, it is critical that support be provided to the unemployed, he said.

“It is crucial to extend the SRD (Social Relief of Distress) grant to the food poverty line and link its recipients to skills and employment opportunities.

“The government also needs to increase the Presidential Employment Programme that has provided work opportunities at the minimum wage and badly needed experience and skills to 500000 young people.”

Parks said the programme should be expanded to accommodate one million unemployed persons by next year’s Budget speech and two million participants by the time of the Medium-Term Budget Policy Statement.

A business-as-usual approach would not work, he said. What was needed was an activist government and a democratic developmental state that was capable of intervening to transform the economy into one that provided decent work for all.

The SA Federation of Trade Unions said joblessness, especially among the youth, remained alarmingly high.

The union’s Trevor Shaku said while they welcomed the increases in employment over the eight quarters, it was still slow and presented no hope of reducing unemployment from the current highs.

“Expanded unemployment, which we recognise as the true measure of unemployment (that includes those who have given up looking for jobs because it is fruitless), declined from 42.1% in the second quarter to 41.2% in the third quarter of 2023.”

Shaku said the country’s structural unemployment challenge, with no alignment between skills and jobs created, needed to be addressed.

The economy had not been able to create jobs for new entrants and for those who had lost employment in the past, he said.

“Consequently, more than six million people are trapped in what is considered to be permanent unemployment.”

The Mercury