While the National Development Plan (NDP) is the cornerstone for building an economically inclusive, prosperous South Africa, high levels of unemployment remain a major obstacle.
A big part of the answer to the employment challenge lies in harnessing young South Africans’ natural entrepreneurial spirit, and building a robust small and medium enterprises (SME) sector.
This is according to Gugu Mjadu, spokesperson for the 2018 Entrepreneur of the Year competition sponsored by Sanlam and BUSINESS/PARTNERS, who says it’s unlikely NDP goals will be reached by 2030 without a far stronger SME sector.
She believes government support and competitions like the Entrepreneur of the Year are vital ingredients for building a vibrant SME ecosystem.
While part of the NDP vision includes social protection for the unemployed youth, the NDP also recognises that the cumulative cost of supporting the vast numbers of these individuals is neither affordable nor sustainable hence prioritises the creation of new jobs.
To date, the country has struggled to create jobs, resulting in high levels of unemployment. Statistics South Africa (Stats SA) recorded an unemployment rate of 26.7% for the fourth quarter of 2017, while the Stats SA Quarterly Labour Force Survey for the third quarter of 2017 pegs the unemployment rate for youths (aged 15 to 34 years) at 38.6%.
“Raising employment levels and expanding the tax base so that there are enough taxpayers and contributors to ensure the sustainability of social protection is imperative for reaching NDP goals. Current and future entrepreneurs need to be nurtured and supported as they are critical for building a strong, dynamic SME sector and creating much-needed jobs. Both government and business have a key role to play in making this a reality,” says Mjadu.
Government already provides a degree of support through various grants, loans, incentives schemes and mentorship programmes from the Department of Trade and Industry (DTI). The consistent theme of support for SMEs during the 2018 Budget Speech was heartening, suggesting Government is becoming more serious about boosting this vital sector.
The significant role of private-sector competitions like the 2018 Entrepreneur of the Year play in nurturing entrepreneurs and developing the SME sector cannot be underestimated.
“For 30 years the competition has been recognising and rewarding generations of young South African entrepreneurs. It has helped to position entrepreneurship as a viable and aspirational career. The value entrepreneurs derive from participation goes way beyond the cash prize money available – so it is critical that we encourage entrepreneurs to take part in these initiatives,” says Mjadu.
“Other benefits of the competition include the experience of the rigorous process which requires you to examine and evaluate your business, business mentorship prizes, networking, connecting with like-minded entrepreneurs and enhancing your business’s profile. All this strengthens entrepreneurs’ ability to deal with some of the biggest challenges they face, such as growing their customer base, increasing revenue and securing funding for expansion.”
She encourages all entrepreneurs to experience these benefits by taking part in the competition.