Is the National Development Plan the answer to SA’s unemployment problem?

The South African economy is in a crisis – even the World Bank thinks so. In its economic update at the beginning of February, the bank revised its economic growth outlook for South Africa to 2.7% from a previously predicted forecast of 3.2%. In an address to the Potchefstroom Business School at the end of last year, Professor Raymond Parsons – special policy advisor at Business Unity South Africa (BUSA) – stated that South Africa could be aiming for a growth rate of 6% instead of the current low rate. This would go a long way to solving what he terms to be the “overarching triple challenges of unemployment, poverty and inequality”. So how can we successfully grow the economy?

According to Professor Parsons, we need to look at a piece of South African legislation and policy.

“The effective implementation of the National Development Plan is not only now urgently necessary to achieve SA’s socio-economic goals but is also essential to strengthen business and investor confidence at a challenging time,” cautioned Parsons.

What is the National Development Plan?

The National Development Plan is a 500-page document that aims to eliminate poverty and reduce inequality by 2030.

To achieve these goals, we need to – among others:

  • Develop an economy in which all South Africans can be active,
  • Build the capabilities of all citizens,
  • Enhance the state’s capabilities, and
  • Promote leadership and partnerships throughout society.

However, no one said that meeting these goals will be easy.

Professor Parsons warned his audience that to meet the objectives of the plan, the economy must grow faster than its current rate of just over 2% so that business can develop and absorb those who are unemployed.

Are the National Development Plan’s goals achievable?

Yes, the goals of this piece of South African legislation are achievable but there are a number of factors that are standing in the way:

  • Too few people work.
  • Schooling for black people is of a poor quality.
  • The current infrastructure won’t sustain economic growth.
  • We experience massive spatial divides which hamper all South Africans becoming active in the economy.
  • The SA economy is too dependent on resources, which means that every time there is a strike in the mining sector the economy suffers badly.
  • The disease burden is widespread.
  • Not everyone benefits from public services – which are of a poor quality to start with.
  • Corruption and crime levels are high.
  • South Africa is still a divided society.

So what is the solution?

Professor Parsons warned that the National Development Plan won’t magically solve all of our problems. He said that if we put in the work to implement this plan – as it was designed – we’ll reap the rewards.

Professor Parsons is speaking at the IPM HRD Summit next week. Follow this link for more information.

This article first appeared on HR Pulse.

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