/ 14 October 2021

Phase two of presidential employment stimulus gets R11bn boost

Minister Nxesi 1246 Dv
Employment and Labour Minister Thulas Nxesi. (Delwyn Verasamy/M&G)

R11-billion has been allocated by the treasury for phase two of the presidential employment stimulus. 

The stimulus package is part of the state’s Economic Reconstruction and Recovery Plan, and is a response to the Covid-19 pandemic and its effects on unemployment and the economy. 

The latest injection was announced at a media briefing by the minister in the presidency, Mondli Gungubele, together with Employment and Labour Minister Thulas Nxesi and Public Works Minister Patricia de Lille. 

The package was launched in October 2020. 

Gungubele said that during phase one, more than 550 000 jobs and livelihoods had been supported, with the overall target being 694 120 work opportunities. 

“Phase two has commenced with a total of R11-billion allocated by the treasury and this will support the continuation of some programmes from phase one as well as a range of new programmes.”

Phase two would include the establishment of a new social employment fund, which would be provided by organisations outside of the state, according to Gungubele.

Nxesi said that during phase one, 84% of participants across all programmes — including public employment and livelihood support — were people below the age of 35, and that two-thirds of all participants were women.

The second phase would focus on young people, given the severity of youth unemployment in South Africa.

Statistics South Africa’s Quarterly Labour Force Survey for the second quarter, which was released in August, said that unemployment had hit a record high of 34.4%, or 7.8-million people. 

Stats SA also found that the labour market was more favourable for men than women. The official unemployment rate for women was at 36.8%, compared with 32.4% for men.

Nxesi said the second phase of the employment stimulus would support the implementation of the Presidential Youth Employment Intervention for unemployed young people, with an R833-million allocation from the overall budget. 

Phase two would also support demand-led training as a new approach to skills development, which links training directly to available jobs.  

De Lille said the department of public works was able to expand its own employment programmes in the sector with additional funding from phase one of the stimulus.

During the 2020-21 financial year, the department appointed 1 886 graduates, of whom many were able to secure external employment, she said. 

According to de Lille, the employment stimulus programme had focused on ensuring that the jobs created provided meaningful work experience for participants to be “work ready”.

Anathi Madubela is an Adamela Trust business reporter at the M&G