How do we create 5 Million new jobs in 10 Years? 24


Hardly had President Zuma set the job creation target at half a million new jobs per year or the prophets of doom started telling us that the target was unachievable. This despite the proposed jobs fund of 9 billion rand over the next three years to finance new job-creation initiatives, the Industrial Development Corporation setting aside R10 billion over the next five years for investment in economic activities with a high jobs potential and the R20 billion in tax allowances or tax breaks to promote investments, expansions and upgrades in the manufacturing sector.

 

I believe that we are failing to create jobs in this country, not because of legislative constraints, as many claim, but because of a lack of goodwill from employers and a massive degree of ignorance amongst those responsible for job creation in companies. Surely a country with 3 300 public companies, 229 000 private companies and more than halve a million close corporations should have no problem creating 500 000 new jobs per year.

 

Training a learner on a learnership should cost a company virtually nothing as current legislation already provides for SETA Grants and SARS allowances that will likely be more than the training fees and the salary of the learner combined. Yet very few companies are making an effort to understand this legislation and cost is still put forward as a reason why companies fail to employ and train new people.

 

The other excuse for not training learners on learnerships I often hear is that “appointing a manager to oversee the program, assigning a mentor to a learner and expecting the full time employees to be involved in the training of a youngster that might take over their jobs is too labour intensive and too expensive.”  In my opinion such excuses are indicators of a lack of goodwill as both overseeing a learnership program and being a mentor to a learner are job enrichment activities that will benefit the manager or mentor as much, if not more, as it does the learner. I further believe that any employee who sees the training of a learner as a threat is not committed to the growth of his/her company and deserve to be replaced by someone with more energy and more commitment.

 

Companies who are committed to workplace integrated training are more likely to grow and more likely to respond to future Enterprise Development opportunities; Activities that create new jobs and secure current ones.

 

I for one Mr. President am with you on this one!

 

 

Jacques de Villiers: CATS (COO)

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24 thoughts on “How do we create 5 Million new jobs in 10 Years?

  • Ester Olivier

    wher are the days when HR was part of the well being of the staff and Employers viewed new employees as part of the Companie’s pride and joy? I agree ignorance is playing a major part and most HR generalists know little about talent managment as part of Company strategy and objectives.

  • Jacques de Villiers Post author

    Hi Sylvia and Shaun

    Thanks for your contributions. Creating opportunites is very important, but we first have to equip people with the resources that will enable them to exploit those opportunities. That would include knowledge, skills, contacts and access to capital; all of which young people are more likely to pick up as they are exposed to the world of work. So even if a young person is not retained by the sponsoring company at the end of a learnership, they are far better equiped to respond to the opportunities you are referring to than they were before.

    Jacques

  • sylvia hammond

     Hi Sean, 

    Yes you are right about opportunities to become self reliant.  I’ve copied a report on the pilot projects to do just that. It’s a report by Bua News on the President’s reply to the SONA.  

    “Pilot projects to encourage self reliance among social grant supporters have been set up in some provinces, said President Jacob Zuma.

    President Zuma was responding to questions following last week’s State of the Nation Address (SONA) in Parliament on Thursday. The President was referring to the fact that close to 15 million South Africans receive social grants, 10 million of which are children.

     “By September 2010 in the Northern Cape, 16 976 people had been linked to income generating opportunities, 3 024 in Gauteng as well as 450 women and 182 young people in the Eastern Cape,” Zuma said.

     In the North West province in Bokfontein, 600 social grant beneficiaries have been linked to the local community works scheme programme, while in Dutyini village in the Eastern Cape, 39 women and one man, who are grant beneficiaries, are linked to a number of projects such as candle making.

    “Lessons from these pilot projects will enable better roll out of these programmes around the country. Another key poverty alleviation mechanism directed at children, is the subsidy ranging between R12 and R15 per child per day, for qualifying children from poor households attending Early Childhood Development centres,” explained Zuma.

    Zuma acknowledged that social grants were useful in the alleviation of poverty, but were by no means a substitute for rural development and employment creation.

    “To date, more than 400 000 children receive the subsidy in 16 250 centres registered with the Department of Social Develo

  • Jacques de Villiers Post author

    Hi Des, Some companies do learnerships in order to tick the right boxes and that of cause can never be sustainable. Learnership training should be part of the the broader personnel and growth strategy of companies.

    I think we should stop relying on the SETAS to initiate learnerships and a forum like this has a role to play in this regard. Dream with me for a while:

    Company A has a specific training need for three people – Their SDF uses this forum to find out if other companies in that industry have a similar need and discovers that its indeed the case – Service Provider X bent over backwords to accommodate the companies, because the numbers now justify the effort. – An excisting learnership is imbedded in the training – Grants are claimed from the SETA and everybody wins.

  • Des Squire

    Hi Jacques, Throwing money about does not create jobs and neither does offering training in learnierhips which appears to be the main point put forward in your most interresting blog. the majority of companies I am involved with do offer learnerships and I have personally ben involved in training on learnerships. havy you perhaps noticed how many learnerships are given to companies by the SETAS? Have you noticed how long it takes to get approval? Have you noticed how many learners undergo learnerships just to get paid the subsistance allowance. How many learnershoips have been completed and how many jobs have been created to ensure the learners were placed in gainful employment?

    We do not necessarily need to create new jobs we must first fill the vacancies that exist. 

    If employers are required to take on inexperienced  and untrained applicants in order to assist in job creation then let the government offer some of the Millions to such companies as a subsify during the training and development period. 

  • Jacques de Villiers Post author

    Lastly when it comes to the misappropriation of these funds …

    I everybody is queuing at the pot and somebody tries to take more than his share, his likely to end up with a bloody nose. Its when we leave the pot unattented that we make corruption possible.

  • Jacques de Villiers Post author

    B-BBEE has a part to play in building our economy especialy when it comes to the creation of enterprise development opportunities, but most companies does not even attemp to score on this component that should be a major job creator.

    If I could be in power for a day I’ll increase the skills levy to 2% and tweak the B-BBEE scorecard so that enterprise development becomes a compulsary scorecard component!  

  • Jacques de Villiers Post author

    Yes, job creation only makes sense if the business activity is there to justify those jobs, but without trained people we can not grow the economy, so it becomes a chicken or egg scenario. I think that job creation and training go hand in hand and should not be seperated.

    Part of the problem is that very few HR Specialist ever make it to the senior excecutive level and that is why Directors and CEO’s are so slow to embrace training and/or job creation innitiatives.

  • Jacques de Villiers Post author

    Thank you all for commenting on my posting.

    I’m not a die hard government supporter, but I do think that legeslatively they’ve done a lot to make training affordable.  Delivery remains a different issue alltogether, but instead of criticising the President I suggest that we take him up on his commitment, that government wil do its share if the private sector creates the majority of the jobs.

  • ZAYNE MARIMUTHU

    Hey All,

     

    Let’s not be b…s…ted by Zuma and his cronies, wake up and smell the coffee, it is election time and one can expect all these pipe dreams, pie in the sky initiatives that the Government wants to implement. They should focus more on catching the thieves amongst them, than coming up with smokescreen initiatives that aims to serve their own deceitful intentions and purposes.

    The question one needs to ask “For how long are we going to tolerate the incompetent and brainless politicians, and for how long are we going to grovel, beg and plead, with these modern day charlatans?” And let it be known that there is no leader (ex-presidents included) of the current ruling party, that can claim not to have soiled their hands by having their fingers in the cookie jar as well as absolving themselves from abuse of power and authority in pillaging state funds for their own greed.

    It is a shame that citizens in this country are failing to see through our modern day bandits, that rally around in opulence and grandeur, yet they cannot even think laterally, let alone think at all.

  • GARNET ASHLEY (BRUNO) BRUNIQUEL

    Skilled people create jobs. Throwing money at the unemployment problem or banning labour brokers is not going to solve the problem! Construction does not take place without architects and engineers and without them, service delivery will simply not happen.

     To create jobs we need to train our people but this is a long term project which I will come back to. We have a short term problem and we need to import skills, especially into Government and local government structures. Streamline our immigration laws so that employers can employ skilled people from outside South Africa – it does not matter where they come from as long as they are honest, hardworking and have skills we can use.

    As far as training is concerned, our Government needs to realise that there is a big difference between Training and Education. Training people creates jobs but the system is too bureaucratic and academic. The whole accreditation of training process is based on unit standards but there is no proper system in place to see that they are properly written and vetted by competent people with practical experience.

    This makes the accreditation of courses, learnerships etc. a losing battle. If you base a course on a unit standard which has not been properly thought out or which does not meet real needs, it is logical that you will end up with an inferior course. Then to make matters worse, instead of using Pareto’s 80/20 principle, Setas require courses to be 100% compliant with unit standards! To add insult to injury, course developers have to spend precious time making up alignment matrixes designed to enable verifiers to see at a glance where a particular assessment criteria has been met. Bureaucracy gone mad!

    All these things kill employers will to create jobs. Mr President, if genuinely you want to create jobs then understand that while trade unions may sway votes, they do not create jobs! Employers create jobs, especially small employers who by their very nat

  • Tim Madgwick

    Just a thought. Why don’t we elect a government that believes in dignity for all, zero racism, respect and equal opportunity. Oops that may upset the unions and not be politically correct as we would have to scrap BEE, affirmative action and the Employment Equity Act. However we could entice South Africans of all races back who have skills and who are battling in other parts of the world. They could bring back the much needed skills and the desire to work, this would create about 5 jobs per skilled worker and the country would blossom. We could then lower tax as we have a larger tax base and bring about an economic revolution in Africa. We could export to China!

     

    I had a dream ………………………..

  • Bethuel Sello Modise

    ‘Tenderpreneurs’ must change and become ‘jobreneurs’, this will spread resources to those who most need them. The current ‘crop’ of possible job creaters is a greedy lot. The social classes also make it a bit misty for rich guys to see the real need for job creation. CEO’S and owners of big companies possibly do not stay in townships and squater camps and thus do not have a true reflection of the conditions of the unemployed. One company that I once worked for, came with a plan to make managers in the company to visit ‘black’ residential areas as well as rural areas. these managers were required to go and spend a night at employees’ places and also use public transport. I still think this was a wonderful initiative to make employers see the true picture of the need for more employment opportunities. Bulk of SA resources is in the hands of a few white people (sorry, dont want to sound racist) but majority of them do not really know where a majority of South Africans live. They have never really been to black townships let alone deep rural areas. How can this group of people honestly be expected to create jobs?

  • Pat Pillay

    Some insightful and noteworthy comments, Mr de Villiers

    A comment about the Learnership Grants.

    If a company has e.g.20 learners on a Learnership programme, cash grants are not granted to all of the learners, but only a part of,as decided by the relevant executive committee.

    About Training & Development.

    It is frustrating to note that CEO`s and Directors of large corporates have still not yet embraced the fact that it is people and their development that will help support the business objectives. This is where the scourge really lies. All CEO`s are really interested in is in the business profits and sales targets.

     

    Here`s a challenge.

    How many CEO`s / Directors really understand and fully support and embrace strategic People Development initiatives such as Learnerships in their businesses? Find me one and rest assured that CEO / Director is leading a truly successful company , in all aspects.

  • ZAYNE MARIMUTHU

    There is absolutely no point in setting up all these funds and grants, when our government officials/politicians are inept and incompetent as well as seriously lacking in leadership and management skills. It will be just another cookie jar that will be mismanaged, defrauded and embezzeled as is the common practice. We unfortunately cannot give support to crooks and thieves. The government has set no precedence when it comes to corporate governance and as a result it is the citizens that will be shortchanged and disadvantaged.

     

    Focus must be on creating good leaders with sound management skills as well as good ethics, values and principles, otherwise everything will be an exercise in futility which can and will lead to our own moment of EGYPT. Evrything sounds good on paper/legislation, etc. It serves no reason and logic when our senior ministers and government officials that should be the driving forces behind these social and economic development programmes, are themselves ignorant nor have the skills to plan, implement and apply these programmes. In short we have incompetence and criminals that are hell bent on enriching themselves at all costs….and us poor citizens will continue languishing in despair and desperation.

    And talking about the SETA’s, let’s get real it is a collosal mess and has proved how money has been pillaged and used for all the wrong reasons. Least I say more and incriminate my self for TREASON (criticising our all so mighty government), let me not say more…….

  • Themba Peter Mpofu

    Jacques, I totally agree with you. there is this tendency not to interrogate issues and to reject them out of hand because of our own bias towards the messenger or what that person is thought to stand for. I am also aware of a lot of private sector companies that will happily pay their 1% levy and do nothing about leveraging it to their advantage through existing skills development initiatives via Setas. This guarantees that they miss out on the benefits of this system and in their contribution to job creation and the growth of our economy. Much as we would like to think that job creation is a government function,, the private sector creates a lot more jobs. It is just that some sectors of our population do not want to be seen to be working together with the current government. It is a sad loss to us all. That does not mean that we should keep quiet about corruption, favouritism and the employment of unsuitable government employees who will fail to deliver, not because they don’t want to, because they do not know how to do those jobs! So other facets of job creation should be looked and corrected – get the right civil servants to play their part in getting the playing field suitable for the private sector to operate efficiently.

  • Gavin Tonks

    I am not sure what the focus is on jobs if there is no business. Johannesburg council is a shambles because they employ 27 000 people to do the work of 11 000 people. People employ because it is profitable to do so, not because you need people standing around doing nothing. 

     

    5 million people out of 13 million unemployed people would create their own work if their was an economy to sustain employment. 3% of companies run 97% of business leaving nothing for the small business. If a person wants say R5000 a month as a salary 60 000 rand a year as lowest income, you would need at least 30 billion wage bill and a turnover 240 billion if your wage bill is 20% of your business,

     

    Now please tell me where this extra business is going to be generated? All that will happen is the existing business of food and communication will grow. I know that R9 billion of product can be made and supplied to 2 retailers cheaper than importing from China. Why do they not do this. Overseas investment means profits generated in this country are expatriated to the countries of origin with zero investment in new capital infrastructure or wealth in this country. 

     

    While people support Chinese production then the value of the investment dollar goes to China as USA has seen to their detriment. Their are billions of rands sitting in investments now that have no where to go as no one is prepared, to fund the risks to business success which takes a 3 to 5 year cycle.  

     

    Most business is generated from government and then there is no loyalty as contracts are awarded to new companies who need to reinvent the wheel with infrastructure each time. If you cannot look at developing an industry there will be no new jobs. It is also bizarre to think that misgovernment which is entrusted with managing the assets of the country, must now become a “job creator” god I hate that word.

     

    people are not idiots if they had better access to

  • Jacques de Villiers Post author

    Well the details of the job fund is still a mystery – I’m talking about the money available to learnerships under current legislation. For example:

    If a small accountancy firm decides to train someone on a learnership they will qualify for the following:

    The Mandotory Grant, The Pivotal Grant, The Strategic Cash Grant and the Learnership Cash Grant. Some of these they will qualify for even if they don’t pay a skills levy.

    Then there’s the tax incentives – R30 000 at the beginning and the end of the learnership

    So say their payroll is R3M and they are levy paying they will get a R15 000 mandatory/pivotal grant, about R11 000 from the other grants and almost R17 000 back from the taxman, totaling  R43 000.

    The minimum salary payable to such a learner is R1 500 per month or R18 000 per year, leaving them with R25 000 to spend on the training per year before it costs them anything.