The state of youth: labour market status & policy challenges

South Africa's demographic profile and its youth bulge provides a unique opportunity to make substantial progress over the next decade or so with reducing unemployment and poverty, and to fundamentally change the structure of its labour force. To do this, requires deliberate policies and interventions to address the situation, which young people continue to face in the post-apartheid labour markets. This discussion document looks at some of the reasons for a focus on the youth labour market, including the need to halt the growth of new generations of long term unemployed, of new generations of low skilled workers and the contribution towards halving poverty and unemployment. More specifically, it looks at how by investing in young people, South Africa can benefit from the demographic dividend of an expanded labour force and lower dependency rates. The section on the situation of South African youth in the post apartheid labour markets highlights some of the developments, opportunities and challenges identified by many other investigations into the labour market challenges facing young people. It draws attention to the high levels of youth unemployment (twice the adult rate) and discouragement, long periods in unemployment and searching for jobs and the impact these have on young peoples skills and future prospects in the labour markets. The discussion also draws attention to the reasons put forward in the literature for the high levels of youth unemployment in comparison with adult unemployment, i.e. the unique characteristics of the youth labour market. Section 5 provides an overview of youth labour market policy since 1994, arguing that South Africa has followed a two-track policy of integrating youth into general employment and growth strategies, whilst recognising the need for specific youth focus points. It does this by looking at the process in NEDLAC, particularly the 1998 Jobs Summit and the 2001 Growth and Development Summit. The paper in Section 6 provides a birds-eye view of the different active youth labour market measures, which are already being implemented or are under consideration, based on three areas elements of active youth labour market policies, identified in the literature: (i) supply-side youth labour market measures, (ii) demand side measures labour market measures; and (iii) employability, employment and labour market information. The details of this overview are contained in the Annexures, but section 6 gives an overview of the existing policy and programme initiatives in each of these three areas, as well as the challenges. Three further matters relevant to youth labour market policies are highlighted in this section, namely the issue of targeting of youth; the need for joined-up policy and coordinating institutions and the role of other social partners. In particular, this section argues that the absence of an overarching Youth Labour Market and Employment Policy framework for the country contributes towards policy incoherence of the myriad of institutions involved in youth labour market policies, and hides the fact that though many initiatives exist, they are nowhere near on the scale, resourced or of capacity and reach to address the millions of young people being pushed to the margins. The section further argues that there already exist a wide myriad of initiatives and approaches that can be build upon. It has the potential, if pulled into a coherent framework, scaled up and with existing gaps addressed, to provide the 'policy triggers' which can enable South Africa's young people to better make the transition to the labour market, and to make use of opportunities once the general economic and labour market situation improve.