The two ANC failures that cost South Africa 5 million jobs

By failing to grow its economy at the average rate of its other emerging market peers, South Africa lost out on moving between 3.2 million and 4.4 million people into formal employment. This equates to as many as 4.8 million additional jobs. 

This is closely tied to the country also missing out on trillions in additional economic output and a substantial amount of tax revenue, which would fundamentally undo South Africa’s financial crisis. 

The country’s lost 15 years of economic growth, where its output grew at an annual rate of 1.1%, is beginning to have significant consequences on state finances, unemployment, and social stability. 

This is feedback from Investec Wealth & Investment International strategist Osagyefo Mazwai, who explained the impact of lacklustre economic growth over the past 15 years on unemployment. 

In a recent research note, Mazwai noted that had South Africa’s economic growth been in line with emerging market peers at 4.5% per annum since 2010, the country’s labour market would look fundamentally different. 

Under a higher growth environment, South Africa’s unemployment rate would likely currently be between 15% and 20%, not the current 31.9%.

“In real terms, this translates into between 3.2 million and 4.4 million fewer unemployed people, or as many as 4.8 million additional jobs in the economy,” Mazwai said.  

“The scale of this lost opportunity underscores a hard truth – weak growth has not only stalled prosperity, but it has also structurally reshaped South Africa’s labour market in damaging ways.”

Mazwai explained that the greatest cost of this underperformance has been borne by young South Africans, with many unable to enter the formal workforce. 

This is not only due to a lack of jobs being available, but increasingly it is also due to a widening skills mismatch between what companies want and what unemployed South Africans have. 

South Africans under the age of 34 make up 58% of the unemployed, accounting for 4.6 million of the country’s 8 million jobless citizens.

Had employment outcomes improved under stronger economic growth, younger South Africans would have been the primary beneficiaries. 

“Instead, an entire generation has entered adulthood amid chronic joblessness, limited skills transfer and diminishing economic confidence,” Mazwai said. 

The ANC’s shortcomings

South Africa’s unemployment crisis is not only about a lack of economic growth and capital investment, but it is increasingly a story of a lack of skills due to a failing education system. 

Mazwai explained that more capital is unlikely to resolve South Africa’s unemployment crisis, with the country’s unemployed lacking the skills needed in a modern economy. 

Former Finance Minister Trevor Manuel pointed to the government’s failure to transform the education system to give South African students the right skills for the economy as a key reason for the current unemployment crisis. 

For example, more than 80% of Grade 4 learners in South Africa cannot read for meaning, while in nearly half of all secondary schools, no child reaches the intermediate maths benchmark.

“Part of our problem as South Africa is that we have not sufficiently considered what the transformation of education is about,” Manuel told the Africa In the World Festival. 

Manuel explained that South Africa has a two-tier education system. “There is education for what we used to call private and former model C schools, and then the education for the majority. It is completely binary,” he said.

The nature of this system is still prevalent, although not race-based, despite trillions of rands being spent on education in the past 30 years by the ANC government. 

Front of the ANC’s efforts in the education sector has been transformation. While it has increased access to education, it has failed to improve its quality in South Africa. 

“It is a huge achievement that 80% of school children in South Africa are at no-fee schools. But no fees frequently also means no maths, no science, and no discipline,” Manuel said. 

“And so this notion of transforming the education system is a curious thing that we have not been able to master in South Africa.” 

Manuel said the failure to transform South Africa’s education system has resulted in the majority of the country having the same problems it faced 60 years ago. 

“Bantu education was built in the 1950s without mathematics. That was in 1953, and in 2025, the mathematics is still not there,” Manuel said. 

“You have taken quantitative skills out of a generation of learners and successive generations of teachers, and so it is still not there.”