Jobless figures again raise youth wage issue

One proposal that has been put forward to grow the economy and create jobs is the youth wage subsidy. (M&G)

One proposal that has been put forward to grow the economy and create jobs is the youth wage subsidy. (M&G)

One proposal that has been put forward to grow the economy and create jobs is the youth wage subsidy, which would subsidise businesses that employ more young people.

The government has set aside R5-billion over a three-year period for the subsidy, but its implementation has been stalled by some organisations, including trade union federation Cosatu, which has been the biggest stumbling block.

Cosatu is opposed to the subsidy and has said it will not work unless the government also addresses the education crisis.

Cosatu  general secretary Zwelinzima Vavi, addressing Parliament earlier this year, said: “We don’t think that the youth subsidy will address the crisis of unemployment unless you recognise that it’s not different to other structural problems like education, which is in a dire crisis.”

Hiring and firing
Cosatu has also said that the subsidy will promote the hiring of the young and the firing of older workers, creating a two-tiered labour system.

The Young Communist League is also opposed to the subsidy, and its spokesperson, Yershen Pillay, said the R5-billion would be a waste of money.

“Instead of spending R5-billion on a youth wage subsidy, we should look at spreading the resources across different types of interventions. For example, a large portion of that money could be allocated to the national skills fund and the national youth service programme to adequately skill and train young people for greater absorption into the current labour market.”

But the Democratic Alliance Youth League spokesperson, Reagen Allen, said that many young people support the subsidy and it has been endorsed by, among others, the Black Business Council, the treasury, the United Nations Development Programme and the African Development Bank.

“Cosatu are opposed to this because they know it will be difficult to unionise these workers.
Their main objective is to increase union membership, not to increase the number of employed people. That is why they are fighting against an excellent proposal that is clearly in the national interest.”

Allen also criticised the National Youth Development Agency (NYDA), and said: “The agency employs 500 people at an average cost of R29 000 per staff member per month. We have known for a long time that the ANC Youth League-aligned NYDA board is running an employment agency for pals.

“It is only now that we can see just how focused on staffing, to the exclusion of real development, that the board is, to the point that its plans are simply nonsensical.”
The agency’s spokesperson Linda Dlovu said: “The NYDA in its two years of existence has received two unqualified audit results by the auditor general. That in itself indicates that NYDA has strong governance and strong financial management. Therefore the continuous criticism is ill informed and … a cheap swipe at the NYDA.”

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