Government: You Have a Role in Promoting Youth Entrepreneurship

Jun 4, 2020

Most governments are guided by constitutions which underscore the rights of their peoples to participate in their countries’ development. In addition, governments put in place other legislative frameworks that operationalise the provisions in their constitutions. Evidence, however, shows that despite having these elaborate legislative frameworks, the economies of many nations do not serve the needs of all their peoples equally, especially the youth.

Take for example, the Government of South Africa. In addition to the 1996 Constitution, there are several other legislative instruments, including:

  • National Youth Policy (2015-2020)
  • National Youth Service Development Policy (2002)
  • National Youth Development Agency [NYDA] Act (2008)
  • Broad-Based Black Economic Empowerment Amendment Act (2013)
  • Skills Development Act of 1998 (as amended)
  • Youth Employment Accord (2013)
  • Skills Accord (2011)

All these are aimed at increasing the participation of young people in the country’s economic activities. Institutionally, the Government of South Africa operationalised the NYDA Act (2008) by establishing the National Youth Development Agency whose mandate is to initiate, design, coordinate, evaluate and monitor all youth development programmes implemented by organs of the state, private sector and non-governmental organisations (NGOs).

Similarly, strategic frameworks have been developed to enhance youth participation in the economy. These include:

  • The National Development Plan and the Vision 2030 which contain elaborate proposals that are aimed at equipping youth with life-skills, entrepreneurship training and opportunities;
  • The New Growth Plan (2011) which mandates government to create jobs in various economic sectors using a variety of schemes;
  • Three-year Industrial Policy Action Plans (IPAPs) created by the Department of Trade and Industry (dti) to highlight among others, the sectors that have the potential to create jobs for young people and strengthen youth entrepreneurship;
  • Growth, Employment and Redistribution (GEAR) Strategy and the Integrated Strategy on the Promotion of Entrepreneurship and Small Enterprises, both of which inter alia, are aimed at fostering a more enabling environment for the development of entrepreneurship and small business; and
  • The Youth Enterprise Development Strategy (YEDS) 2013-2023, which aims at increasing the contribution of youth-owned and youth-managed enterprises to the country’s gross domestic product (GDP).

 

One could say that South Africa, like many other countries, is not short of frameworks that could stir and propel youth entrepreneurship. Yet, despite these elaborate instruments, there is widespread acknowledgement, even within government, that the participation of South African youth in the economy has remained dismal and has not developed as expected.

 

The 2016-2017 report of the Global Entrepreneurship Monitor (GEM) indicated that only 37.9% of South African youth perceived themselves as having the capabilities required to start their own business. This report also showed that only 35% of South African youth were able to recognise entrepreneurial opportunities in and around their communities. Other research conducted in South Africa indicate that there is little appreciation of entrepreneurship as a career and an employment generating venture. Youth are believed to be having a tendency of viewing business ventures as a last resort, resulting into very few new business start-ups, especially among graduates. The youth are said to be oriented towards job seeking rather than job creation. Furthermore, they are said to have a tendency of depending on government and the private sector for jobs. Additionally, South African youth are said to be choosing entrepreneurship or self-employment out of necessity rather than being attracted by potentially viable opportunities. With all these negative evidences emanating from research, it does not bode well for the development and success of youth entrepreneurship in South Africa. There is clearly something that is missing.

 

Here below are four key areas that governments can focus on to support growth of youth entrepreneurship:

 

  • According to the Organisation for Economic Co-operation and Development (OECD, 2012), governments need to put in place favourable policies that facilitate access to finance for youth entrepreneurs to acquire initial capital where private lenders are unable or unwilling to do so. Such financing schemes work better when they are complemented by other start-up support, including advice, coaching and mentoring. Government policy should also recognise different levels and stages of entrepreneurship and target the entrepreneurs with appropriate support depending on their needs and circumstances.
  • A multi-faceted approach that constitutes a coordinated government and private sector strategy supported by development partners, which provides youth with contextualised knowledge, skills and confidence. A coordinated approach will eliminate duplication of efforts and will instead promote synergy and pooling of resources.
  • Appropriate and responsive entrepreneurship education, which has the following salient features:
    • prepares students to become job creators;
    • generates interest, increases a sense of feasibility of entrepreneurship and inculcates an entrepreneurial culture;
    • shapes the mind-set and creates motivation for entrepreneurship;
    • gives young people the opportunity to practice how to start and run a business before actually venturing into it;
    • where learning is conceptualised and conducted in a work setting;
    • where students learn by coping, experimenting, problem solving, opportunity taking and from their mistakes;
    • where students get to learn who they are, who or what they can be, and they begin constructing stories about themselves; and
    • where entrepreneurship educational programmes recognise and build on the capabilities of different youth and how these impact on their ability to start and manage their businesses.
  • Mobilisation for youth entrepreneurship targeting families and schools as “nursery beds” where entrepreneurial qualities are inculcated and nurtured.

 

At Entrepreneurship Journey, we recognise that a different approach is needed to develop youth entrepreneurship in South Africa and in many other developing countries. Our approach not only imparts practical skills, but it also builds on the motivations, beliefs, ambitions and desires of the aspiring youth that they can indeed pursue and succeed in entrepreneurship.

 

 

Submit a Comment