THE YOUTH EMPLOYMENT SERVICE: Let us make it work by Penny Abbott

THE ROLE OF THE HR PROFESSION IN YOUTH EMPOWERMENT: 20 actions to develop the youth by Marius Meyer
June 5, 2018
Guidelines for successful internships by Penny Abbott
June 6, 2018

INTRODUCTION

The Youth Employment Service (YES) was launched by President Cyril Ramaphosa on March 27th2018. Four years in the making, YES was born in the Youth Employment Accord signed by government, business and labour in April 2013 which committed the social partners to a plan of action which included:


1.       The public service to focus its internship programme, aiming at employing 20 000 interns over a period of time;

2.       State-owned enterprises to develop placement opportunities for TVET and University students who need work experience as part of completing their studies;

3.       Business organisations to discuss within their structures programmes which would improve the employment of young people;

4.       Targets for the employment of young people in growth sectors such as solar heating installation, the government infrastructure programme, and business process outsourcing companies such as call centres;

5.       The Expanded Public Works Programme and associated programmes such as Working for Water, health brigades and literacy brigades to set youth employment targets.

The business organisation The CEO Initiativetook this forward and now YES is one of the first social compacts between government, business and labour, created to give one million youth one million opportunities to succeed over three years.

“This is a timely, worthy and ambitious response to youth unemployment, which is perhaps the greatest and most pressing social and economic challenge facing our country at this moment in our history. What we are seeking to do, through this and other initiatives, is to provide pathways for young people into the world of work.”

– President Cyril Ramaphosa

 

How YES works

YES links up work seekers, corporates and SMMEs and is structured to use available incentives such as the BBBEE Scorecard, the Youth Employment Incentive and Employment Equity plans to encourage employers to create new job opportunities.

Companies can:

  • Place youth inside the company on the payroll and/or
  • Place youth sponsored by the company to work in black owned SMMEs close to where the youth live and/or
  • Develop youth owned micro-enterprises that feed into the company’s supply chain and/or
  • Place youth sponsored by the company into an external service provider for training and work experience.

Companies sign up on the website, stating which option they want to use.

The youth candidates can sign up on the YES website or be sourced through one of the YES hubs around the country. Candidates must:

  • Be between 18 and 34 years old
  • Have been unemployed for more than 6 months
  • Be a black person (African, Coloured or Indian)
  • (It is not obligatory but should companies want to claim the Employment Tax Incentive, then the YES youth must be between the ages of 18 and 29).

SMMEs that want to benefit from the sponsorships and youth interns can also sign up on the website.

Businesses need to create new one-year positions for unemployed youth over and above current employment numbers. Or, if the company cannot take more people, the company can sponsor the salary for a one-year starter position at an SMME which lies closer to where the young person lives – allowing the larger company to qualify for B-BBEE recognition, while building SMME capacity and competitiveness.

Salaries paid to the youth interns must be set at the national minimum wage (NMW) level of R3 500 per month, and there will be associated training and support which on average will bring the cost to R55 000 per annum.

INCENTIVES

 

Government have introduced a new Youth Employment B-BBEE recognition, allowing a business that meets YES targets and complies with registration criteria to move up a level on their current B-BBEE scorecard. This has been delinked from the skills development scorecard points for spending 2.5% of payroll on bursaries for black students. This means that companies can score points for either the YES recognition or the bursaries, or both.

In addition, to encourage demand-side job creation, companies employing black youth between 18 and 29 years old will qualify for the Employment Tax Incentive. Under this incentive  private sector employers in good standing regarding PAYE may claim a subsidy for 24 months for any person newly employed from 1stOctober 2013 onwards, who is between the ages of 18 and 29 and who has a valid South African identity document. Relatives or connections of the employer may not receive the subsidy, neither may employers of domestic workers. The employee must not earn more than R6 000 per month (and must earn the lesser of R2 000 or the minimum wage as per sectoral determination or collective agreements).  The subsidy for the first year consists of a sliding scale depending on the employee’s salary/wage, running from nil at a salary of R6000 per month to R 1000 at a salary of R2 001, and 50% of the salary where the salary is less than R2 000 . For the second year, the subsidy is halved.

 

WHAT THE YOUTH GET OUT OF IT

Research has consistently shown that one year of work experience, coupled with a CV and reference letter, increases a young person’s chances of finding employment by three times. The YES approach provides resources such as an app with videos and templates for youth including CVs and templates for employers including reference letters for when the intern exits.

Work readiness training can also be provided through the YES hubs. In addition, the hubs provide services such as small business development coaching and short courses on skills such as waitressing or cooking.

 

WHAT EMPLOYERS GET OUT OF IT

In addition to making a contribution to resolving one of South Africa’s biggest socio-economic challenges and thereby building a better future for all, a well-designed internship programme can help to accelerate careers, develop professionalism and good work habits and provide employers with a source of excellent candidates for permanent positions in their specialist areas.

The YES programme is carefully structured, according to the YES CEO, to “de-risk” the experience of taking on first time entrants to the labour market. Sourcing candidates through YES can give companies access to people that they would not normally be able to find.

 

CONCLUSION

 

The YES programme is a multi-stakeholder national initiative to address the problem of youth unemployment.  SABPP would like to encourage HR Managers to become part of this formal programme to empower the youth of South Africa.  However, it is essential that all internships should be planned, managed and monitored to ensure maximum impact.

 


Dr Penny Abbott is Research and Policy Advisor to SABPP and author of the SABPP Fact Sheet on the Youth Employment Service. This article is an extract from the Fact Sheet.  The full Fact Sheet is available on twitter @SABPP1 or on the website www.sabpp.co.za  More information about YES is available on www.yes4youth.co.za