How to Reduce Unemployment in South Africa
The structural change in nations’ economies is one of the main reasons for youth unemployment.
Over time, economies shifted from being labor-intensive to being dominated by technology.
Because of the structural unemployment brought on by technological development, an excellent illustration is the banking sector. Banks today use digital banking and self-service devices like ATMs to replace human labor, like sure bank tellers.
I suggest taking into account macroeconomic and microeconomic policies that include demand-side (increase aggregate demand or gross domestic product) and supply-side (increase aggregate supply or enhance human capital or skills) economic policies to address this unemployment issue, which is brought on by the misalignment in skills demanded versus skills supplied.
Expansive monetary policy, which lowers interest rates to encourage consumer spending and raise people’s disposable income in an economy, is one of the demand-side economic measures that aid in reducing unemployment.
The results showed a reduction in graduates between 2012 and 2016, indicating that some young people had left college and universities.
In contrast to the rare specializations of mathematics, physics, and engineering, which are crucial in our technologically sophisticated society, most young people graduate with degrees in education, business, economics, and management sciences.
To close the skills gap that has resulted in the majority of young people being unemployed, the government must integrate entrepreneurship education and training into the high school, college, or university curricula.
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South Africa and other nations must develop an entrepreneurship strategy to provide young people with the skills they need to create jobs rather than just looking for them.
more strategies to reduce unemployment
- use of labor-intensive technology:
- Accelerating investment in agriculture:
- Diversification of agriculture:
- Labor-intensive industrial growth:
- Services and employment growth
Why is unemployment so high in South Africa?
In South Africa, several causes lead to unemployment. The “legacy of apartheid” in the country, a lack of employment opportunities, and “slow economic progress.” After 2002, when the country’s unemployment rate, based on the usual definition, reached roughly 34%, unemployment in south Africa started to decline.
In South Africa, who is most impacted by unemployment?
Women
South Africa is having trouble placing its young people in the labor force. For instance, women’s jobless rates were greater than men’s. Women’s unemployment has surpassed men’s since the beginning of 2016, approaching 38 percent compared to 33 percent.
