The plight of South Africa’s youth, specifically the excessive levels of youth unemployment, is relentlessly in the spotlight. Dealing with it is a national imperative and one of government’s priorities. The state-owned IDC, a development financial institution mandated with capacity development and job creation in industry as key outcomes, has a direct interest in addressing unemployment.
The IDC’s approach to this challenge is anchored by three major pillars: education, work experience and entrepreneurial development.
In April 2014, the IDC was a signatory to the Youth Employment Accord with other stakeholders. The aim is to improve skills development among young people. The IDC reinforced its Accord commitment with a R1 billion contribution from the R10 billion Gro-E Scheme, created to support youth-owned businesses. A tripartite agreement with the NyDA and sefa during the past year also facilitates access for youth-owned businesses to IDC and sefa finance to establish or expand their businesses and NyDA grants to develop bankable business plans.
During the reporting period, the IDC approved R61 million to support businesses with more than 50% youth-owned shares. An additional R44 million was approved for four businesses with youth shareholding of between 25% and 50%. These projects facilitated 429 job opportunities in sectors such as textiles, toilet paper manufacturing, steel window frames manufacturing, agro-processing, cement brick manufacturing, motion picture manufacturing and electric motor fabrication.
The IDC’s entrepreneurial development was complemented by internal initiatives and those implemented with external stakeholders to increase the employability of South Africa’s youth.
Internally, initiatives included matriculant learnerships, a graduate internship programme and Chartered Accountant (CA) learnership training. About 56 young people participated, while 72 new bursaries were awarded in 2013. The IDC will award the same number of bursaries in 2014. The total number of bursary beneficiaries as at the end of March 2014 was 243.
Externally, the IDC extended it youth empowerment role in the education sector through its Corporate Social Investment initiatives. These included support for 20 adopted schools under the Whole School Development Programme through leveraged external resources. Key achievements entailed capacity building through strategic planning and team-building sessions, Learner Representative Council (LRC) training and infrastructure refurbishing at some schools.
The youth Employment Accord also identified the Green economy as a potential sector for youth development opportunities. During the reporting period, the IDC partnered with external stakeholders for a pilot project at two TvET colleges to develop skills for the Green economy.
Other rural and social enterprise interventions included the Goedgedacht Farm project, which provided youth with personal development skills, the Maluti-a-Phofung youth Primary brick-making cooperatives, which empowered 14 young people in brick-making and the Bedford Eagle hout cooperative where high-quality, handcrafted solid wood furniture is manufactured.
The IDC is critically aware of the importance of a bankable business plan for young entrepreneurs. In this regard, the Corporation extended its Tertiary Institution Business Plan Competition 2014 to include an additional 20 tertiary institutions. This followed a successful pilot at the University of Free State in 2013. The competition afforded university students the opportunity to submit bankable business plans to obtain funding, while creating a pipeline of quality business plans for the IDC.