This week saw the National Planning Commission's NPC Jam and I enjoyed it a lot. The Jam was a large online forum, a policy consultation and crowd-sourcing effort towards a vision for South Africa in 2030. It is closed for new comments and discussions now, but you can still log in and read everyone’s comments.
I mainly followed the discussions about the economy and there were a few threads that had a lot of replies. The entrepreneurship and SME thread started by Mr Cyril Ramaphosa was active with a range of different proposal about the role that SMEs can play in addressing the challenges of low economic growth rates and unemployment in South Africa. There were posts about the ease of doing business, access to finance, skills and training. I added that the discussion still needs some clarity about what is meant by small and medium firms. There is also a need for more analysis of the barriers that prevent firms from growing and employing more people. New evidence out of the US shows that SMEs are not the job creators that many people argue (Justin Wolfers tweets that he is still getting hate mail on his comments about this).
Other interesting threads included John Robbie’s proposal for an economic CODESA 3 and discussions on taxes, nationalisation and rural development. The wage subsidy thread started by Kuben Naidoo drew an interesting response from Neil Rankin. Neil wrote that they have a project at AMERU that follows 4,000 young people over 4 years as they attempt to find jobs. Things that stand out include:
- there is a huge number of unemployed youth in SA and companies face large numbers of people wanting jobs,
- to hear about and get jobs requires some link into companies and thus many young people are marginalised because they do not have these links,
- the most trusted signal for the employer is previous work experience of the young person and a reference from a previous employer.
He concluded it is vitally important to get young people into jobs as early as possible, since this has a large impact on their lifetime work trajectory. Neil also argued that we need to think hard about what constrains companies from growing and particularly entering or expanding their sales in the international market where demand is much greater than in the local market.
Amongst the discussions about the labour market I also spotted contributions by two NWU-Pukke Economics students. Erich Wilgenbus (who wrote 19 comments!) discussed the importance of labour market flexibility and Tiaan de Kock linked onto Neil’s point about the importance of getting young people into jobs where they can get some work experience.