ANC government has no idea how to create jobs – economist

The South African government has failed to create an environment in which the economy can grow and people can be employed due to repeated macroeconomic policy failures. 

This is according to Centre for Economic Development and Transformation director Duma Gqubule.

He told the SABC that the ANC-led government has implemented poor macroeconomic policies throughout its time in power. 

Gqubule’s research shows that the government has only managed to create 21,000 jobs over the last five years under President Cyril Ramaphosa, while the number of unemployed has risen by 2.7 million to 11.9 million. 

South Africa has over 10 million young people aged 15 to 24. Of these, only 2.5 million are actively looking for employment or are already employed.

The largest share, 7.5 million or 75.1%, of this group of young people are those out of the labour force.

The main reason for being inactive is discouragement, which means they have lost hope of finding a job that suits their skills or is in the area they reside.

37% of this group was disengaged from the labour market in South Africa. These are regarded as youth not in employment, education or training.

“After 29 years of mismanagement, the ANC has still not figured out how to manage the economy and create jobs,” Gqubule said. 

The only sustainable solution is to implement macroeconomic policies that grow the economy – the problem is too big to be solved through small, local projects. 

South Africa’s high unemployment is mainly due to the inability of the economy to absorb a growing labour force, with projections estimating that 700,000 people will enter the labour force annually until 2030. 

To absorb such a large number of people entering the labour force, the economy would have to grow at 4.9% annually at least, according to Gqubule’s calculations. 

This growth will still be too low to reduce the 11.9 million South Africans who are already unemployed – it will merely stop that number from increasing. 

“We cannot compromise on GDP growth. There are so many distractions every day that the government does not want to talk about the unemployment crisis and the lack of growth.”

Gqubule’s comments came in light of a United Nations Development Programme report on South Africa which referred to the country’s high unemployment as a “ticking time bomb”.

“Youth unemployment in South Africa is a multipronged challenge that limits the earning potential of youth, stymies business growth, threatens social cohesion, and puts pressure on public resources,” the report said.