Some thoughts on the NPC Jam

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.

At the end of the day (RWC lingo is spilling over into my life as well) I enjoyed the Jam a lot and can see how it would be fun to be a full-time commentator, blogger, economist.

Die toekoms van onderrig en assessering is op jou selfoon

As mens eers ʼn blog het sien jy skielik oral berigte oor hoekom ʼn Prof moet tweet en blog. Daar is dalk ʼn mate van self-selection ter sprake, maar oral waar ek kyk is daar nuus oor die gebruik van tegnologie in onderrig. The Economist het ʼn lekker berig gehad oor die internet in die klaskamer en mens kan sommer direk na Salman Khan se TED lesing luister.

Op die NWU-Pukke kampus is ek self betrokke by ʼn loodsprojek waaroor ek baie opgewonde is: in-klas, intydse elektroniese terugvoer. Die ou grappie is dat op skool draai die Juffrou by die bord om, om seker te maak dat almal by is. In derdejaars ekonometrie hoop die Prof dat iemand by is! Maar die dae wat ek ʼn vraag uitgooi vir die gehoor is nou getel. Met die nuwe Quiz stelsel kan mens vooraf ʼn klomp vrae op die stelsel laai en studente kan hulle selfone se web browsing funksie gebruik om daar in die klas vrae te antwoord en terugvoer te kry. 

Die opsies is natuurlik uiteenlopend. Mens hoef nie net meervoudige keusevrae te vra nie.

Om seker te maak dat die uitkomste is bemeester word makliker. Die resultate is op die internet beskikbaar vir die dosent so as jy jou iPad of Galaxy tablet byderhand het kan jy vinnig sien waar die studente vashaak.

Daar is natuurlik nog groeipyne: almal se fone werk nie ewe lekker nie en 3G en wi-fi sein wissel oor kampus, maar ons is besig met die proof of concept. Die toekoms van onderrig en assessering is op jou selfoon.

Analysis needed

This week we had some interesting meetings about economic policy with provincial government and a local investment promotion agency. We all agreed that growth and job creation happens in specific places and there is a need to consider the provincial or local implications of, for example, the IPAP2. What is amazing is how little we all know about which firms are producing WHAT, HOW and WHERE. Data on sub-national economic activity is limited to official annual estimates at provincial level or the databases build by private sector consultants. Almost no-one has any reliable firm-level information. Yet policymakers want suggestions for programmes that they can implement.

This brings me to the point that Johan Fourie raised on his blog today: the typical textbook/ foreign-expert recommendations for such programmes would be to build infrastructure, encourage on-the-job training or ensure a business-friendly environment for firms to grow. Ideas like wage subsidies and arguments for a weaker Rand exchange rate and import substitution strategies are also out there. However, to develop sensible interventions will require more work by academic researchers and an opportunity to make themselves heard.

As in the case of education research, there are a number of people who are doing excellent work. At firm-level Neil Rankin and his AMERU team at Wits are busy with a Youth Unemployment Intervention Evaluation project. Volker Schoër has examined the importance of social networks in finding employment, but considering the scope of the challenges, they need co-workers, collaborators, support. We don’t really know what the barriers that prevent firms to export are, how important links with the suppliers of intermediate goods are, how thick local labour markets are, or how firms are innovating.

Consider this something of a call for more research at the micro-level. We are making plans in the School of Economics, but if you want to join my project mayhem, give me a shout.