Embedding Entrepreneurship early, as a core skill, will be the catalyst for change to develop opportunities for our Youth
In South Africa, entrepreneurship is often a necessity rather than a deliberate career choice, particularly among the youth. With a persistently high unemployment rate, which hovered at 32.9% in the first quarter of 2024, and youth unemployment exceeding a staggering 60%, many young people turn to entrepreneurship as an only resort rather than a strategic career decision (Statistics South Africa, 2024). Faced with limited employment opportunities, entrepreneurship seems like the only path out of poverty for many. However, while some start-ups do manage to succeed, the stark reality is that approximately 70% of small businesses fail within their first two years of operation (Small Enterprise Development Agency, 2023).
Education and Entrepreneurship: A Gap in the System
Despite the trends showing that a large proportion of our Youth must consider entrepreneurship, the education system has not sufficiently adjusted its modus operandi to consider this.
Global Entrepreneurship Monitor (GEM) found that only 17.3% of South Africans believe they have the skills to start a business, highlighting the disconnect between education and entrepreneurial confidence (GEM South Africa Report, 2022). Without early exposure to entrepreneurial concepts, young people are often ill-prepared to make informed career choices that include entrepreneurship. Moreover, the lack of financial literacy and practical business skills leaves many without the essential tools needed to navigate the complexities of starting and sustaining a business.
Entrepreneurship as a Solution to Unemployment
According to the World Bank, small and medium-sized enterprises (SMEs) contribute between 50-60% of employment globally, and South Africa is no different (World Bank, 2023). However, for these businesses to thrive, a conducive economic and social environment is critical.
The GDP growth rate in South Africa is projected to remain below 2% annually, while inflation averages between 5-6% (South African Reserve Bank, 2024). These economic conditions are not ideal for fostering entrepreneurial success, especially when combined with structural issues like inadequate access to finance and regulatory bottlenecks that disproportionately affect small and medium-sized businesses. Without addressing these challenges, sustainable job creation will remain an elusive goal.
A shifting Educational model: A Critical Piece of the Puzzle
Through our work in rural development, township communities and mine community development, it is clear that if we want the results to change, we have to change the operating model.
Creating sustainable educational models that are aligned to the creation of an entrepreneurial ecosystem. The existing model of schools operating like charities that rely on Government funding has proven unsustainable, and so the focus needs to shift towards schools where students themselves provide the maintenance services, develop and operate the ICT infrastructure and successfully develop sustainable food gardens and treat waste as a commodity to extract value through recycling and repurposing.
Understanding that the first example of entrepreneurship that any of us experience is actually the school that we attend. Watching how budgets are managed and services are provided and fund-raising activities are managed are critical skills to develop the entrepreneurial mindset. Added to this, a shift in the curriculum to include practical skills like drivers’ licenses, basic electrical and plumbing, gardening and nutrition, ICT skills and financial literacy, so that school leavers have the skills to earn, develop their own knowledge, with dignity and self-pride, and a focus on showing Youth what sustainability looks like.
Siyakha raises funding for NGO’s, community projects and social impact initiatives. We design and execute integrated socio and enterprise development initiatives. If you need support, and/or you are looking to sponsor programmes, please reach out to:
Charmaine Nkosi
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References
- Statistics South Africa (2024). Quarterly Labour Force Survey.
- Small Enterprise Development Agency (SEDA). (2023). Small Business Statistics and Failure Rates.
- GEM South Africa Report (2022). Global Entrepreneurship Monitor.
- World Bank (2023). SMEs as Drivers of Employment.
- South African Reserve Bank (2024). Economic Forecast Report.
- Human Sciences Research Council (HSRC). (2023). Youth Unemployment in South Africa: Bridging the Skills Gap.
