 please take a seat. Let me keep my cut again. No, I think we can just leave it here. Like this, please. Following that, very easy. So we're going the board here that I have here, which is Nazimi. Abebe is next, but let's see if the connection works. And then Ryan and then you'll be here. You can sit here. No, I'm just saying, I know that the two of you will talk about that. Abebe will talk about that. Okay. So there are a couple of, so we are, we are as usual running behind. It's just amazing how quickly we've run behind so early on. I'm blaming the caterers because apparently they ran late on the food. So that's what I'm going with. Not the interesting and really useful inputs this morning. Just by way of background, we thought as a steering committee, I see Gary and others somewhere here, we would put the policy panel up front. We always felt there was a subliminal signaling, a bit like latex and journal submissions, that when you put the policy panel at the end, that's the sort of add on, right? And actually that's not true. The panel members who I'll introduce now all very worried that they're talking to these high level academics. I said, please don't overrate academics at all. You do the real work and we just, we just put some math and data to it and make it look fancy. And so part of the reasoning here was to talk about employment challenges from the policy perspective and from really seasoned technicians who are economists but who work at the coalface of policy in their various organizations. And so let me just proceed very quickly to introducing our panel and I'll introduce them all at once and then we can just proceed with the conversation. We'll see how it goes. I'm sort of talk show hosts like, I'm going to ad lib and if there are no questions, I'll ask a few, but hopefully there'll be much better questions from the audience. But our first speaker is Mr. Nazim Hendricks. He's the senior technical advisor in the project management office of the South African national treasuries, nine billion ran jobs fund, which I understand is one of the biggest funds in the world of this type. And I've heard Nazim speak and he's very passionate about it, but he has extensive experience in the design and implementation of innovative job creation initiatives across various sectors. And I think he is going to be sharing that with us. He currently serves at the program lead for the Presidential Youth Employment Intervention, Interventions National Pathway Management Network and Innovation Fund. Then joining us via Zoom, as you can see him hopefully in the office, I presume in Nairobi is my dear friend Abebe Schimeles. Abebe always twists my arm to attend conferences in Nairobi deep in December, which for South African you should not do. So I'm twisting his arm to join us here. He's the director of research at the AERC, the African Economic Research Consortium, overseeing thematic and collaborative programs. Abebe brings over 30 years of professional experience in policy research. And as you may know, he's worked variously for academia, NGOs and other international organizations such as the UNDP, World Bank and ADB. You will have read Abebe's work and he has a published portfolio of really high-end journal articles. Our third presenter will be Ryan Muir. And Ryan is the director of evaluation at MCC. He leads MCC's results-based financing for inclusive employment program in Morocco, which pays providers for job placement and retention results for women and vulnerable youth. I'm sure he has data for us, so just keep that in mind. He also leads monitoring and evaluation for Mozambique programs and overseas evaluation staff across 10 other country programs. Before joining MCC, Ryan consulted for TechnoServe in Mexico and was a refugee employment counselor with world relief. He spent over three years in the Peace Corps in Ecuador. He's got a master's in public administration in international development from Harvard, the Kennedy School, and an undergraduate degree from Purdue. And then finally, last but not least, is N'vuyo Guma, whose least impressive credential is that I supervised her for her Honest Thesis. But more importantly, he's now currently chief director for macro policy at National Treasury. So for the non-South Africans, that's our Ministry of Finance. And she's responsible there for sectoral policy analysis and structural reform. Vuyo is an economist with over 15 years of experience in economics and policy development in both the public and the private sectors. She represents the National Treasury, and more importantly, that's why she's here on this panel. She's on the board of something called the Youth Employment Service, yes, which is a really important active labor market intervention from government. And currently, she, sorry, Vuyo holds a bachelor's of science in management studies in economics from UCT, the University of Cape Town, and a master's degree in economics from the University of Johannesburg. So please just join me in welcoming the panel, and then I'm not going to give any, I did prepare preliminary remarks about youth and employment numbers for sub-Saharan Africa. I'm going to dispense with those in the interest of time and actually go straight into asking in sequential order, Nazim to provide us with his introductory remarks. I think what we've heard before, economic growth is the long-term solution to unemployment. However, we do know that that takes a long time, and it ignores the fundamental issues that we currently have in the labor market in South Africa. So government has a number of interventions in place, accelerated growth strategies, as was highlighted by Ms. Makenya this morning. That includes the structural reforms that is currently being implemented, which is really about reducing the cost of doing business in the country, looking to promote inclusive growth, leveraging the private sector funding into it, and then refocusing current public expenditure into public infrastructure projects as well as the public employment programs that is currently being funded. All of that is good and will produce long-term results, I'm sure, but there are certain issues within our labor market that's creating a problem. The first thing is that the systems and ecosystems that's currently being placed are weak, in our opinion. They are uncoordinated, and a lot of that is with how government works, right? The two of us, for example, are colleagues we've never met, we've never had a conversation about anything, and that is effectively how government works. Government departments never speak to each other. They never coordinate their efforts and whatnot, and that is more about a government entity running hard effectively to remain in the same place as opposed to the two of us not wanting to talk to each other. So it is a function of really how government works and the problems that we have. We have an education system that does not produce work-ready young people. I've got four kids, three of which have almost completed one, it's almost completed the other two, it has completely deteriorated education. When I look at them, I don't see young people ready to go into the workplace. Also, our education system entrenched inequality, as it is. That became very clear during the COVID pandemic and the various ability of young people to access the work that they were doing at their various schools. Social networks previously disadvantaged largely young people largely do not have access to the social networks. We do not have, we've got exclusionary practices. As much as employees in South Africa say, they are inclusive. If you look at the way that they appraise the potential of young people, it remains exclusionary. We often look at unemployed young people as an homogeneous group of people. Fact is then, right? There are certain young people who have psychosocial issues that prevent them of actually entering and staying in the labour market. I'm very happy to say that the jobs fund within the Presidential Youth Employment Intervention is supporting south through a unit of UCT of piloting and testing a basic package of support for young people. So we can address those issues, those psychosocial issues, not funding or anything like that, the emotional issues that young people face in entering and staying in the labour market. So for me, the issue is around the way we operate. Yes, of course, there is place for public and very important public employment processes and programs, but the jobs fund is there to promote innovation. We need to make a space for innovation so that we can actually come up with programs that actually deliver results going forward, new ways of doing things, et cetera. And the President in his speech, in his State of the Nation speech in 2019, highlighted that it cannot be business as usual in South Africa anymore. There's got to be a program, well-developed, implemented program to address youth employment intervention in South Africa. Now, the jobs fund is briefly proficient. I'll be from talking too much. The jobs fund was established in 2011 as a challenge fund. And the purpose of it was to test and remains, to test those innovative models, to share risk with the private sector, to leverage funding as well as skills from the private sector, to address unemployment in the country and thereby build partnerships, partnerships that are effective in addressing certain problems and then encourage wider adoption of those policies and programs for other government departments and other market players so that they can scale those interventions going forward. Now, as I've said before, the jobs fund is not a mass employment program. It never has been. It is there to innovate, find new better ways of doing things. So we were capitalized at 9 billion rand. To date, we've allocated 6.2 billion rand. Very importantly, we've been able to leverage 12.3 billion rand from largely the private sector. So for every rand of public funds that we've spent, we've been able to leverage two rand from largely the private sector. What that has done in an environment of a constrained public purse, it allows us to scale interventions to a level that would not normally have been possible. The efficiency of allocation of public funds is thereby improved and it has allowed us to build relationships and build organizational credibility within the market so that we could partner with various organizations in the country. Now, we have supported about 70, just over 70,000 SMEs or smaller medium enterprise in the country. We've been able to facilitate the creation and placement of 297,000 jobs, 57% that was filled by women and 64% of those by youth. Now, key models that we've done, we've looked at the blended finance environment. Now, the problem with blended finance in the country and the systemic change that we have not seen in that market, in the onlending market, is that when you aren't SME, you perceive to be a high-risk client, right? So traditional funders and even some of our DFIs, they will not lend you because of that perception of risk. The problem is when we do have programs, that SME is always seen as a high-risk entity. Whether that SME has paid three or four loans back and proven its creditworthiness and ability to implement, we have not seen the transition of those SMEs from the high-risk entity that was seen at the start to an entity that is now part of the mainstream, if I can call it that, and then represents a credible credit risk. And that is the systemic change that we're trying to achieve at the jobs fund, that type of thing. We've tested social impact bonds, which is growing, but we still see some issues that need to be clarified on social impact bond, particularly on the risk-sharing side. We've looked at guarantee mechanisms as a method of de-risking SMEs and we've also had a number of projects supporting the informal sector. We've had a number of interventions in the spouser shop market. We've had a number of interventions where support and funding is provided to micro-interprises, and we've also had a number of projects, what we call social franchising. For example, in the healthcare space, we had a project where we established or we supported a program for owner-managed primary healthcare clinics in poorer communities in the country. All of these interventions, the purpose of these interventions is really to learn how best to implement these things and then provide a framework for scaling of those interventions. Now, one has to say, I saw the government, we don't necessarily talk to each other, right? We tend to operate in our little silos where we can tick our performance boxes and whatnot, and the purpose of the jobs funds knowledge agenda is really to bring together all of these government departments, all of these role-players in the market so we can distribute those learnings so they can move the models forward. Now, I'm not going to sit here and say all our models have worked, right? We've had about 146 of them. What is important is that we distribute, we learn from those, we distribute what hasn't worked so it can form part of developed interventions going forward. And then, just briefly on the challenge fund instrument, which is what the jobs fund is, what that allows you to do is to allocate scarce public funds to what is what you see as the most efficient, best way of implementing a particular project. Now, what a job, what a challenge fund does, it provides a problem statement. It then goes into the market and solicits the best ideas from the market. That is very different to what government gently does. Generally, government tries to come up with a solution themselves. What the challenge fund does and where the jobs fund does is it puts out a problem into the market. It then solicits the skills, the funding and from these intermediaries who then come to us for funding we have those models approved. Just in terms of what we need, you need very good fund management capacity, you need an M&E framework of very well-developed robust M&E framework and you need security of funding. Funding of one year doesn't help you because it doesn't signal available funding for intermediaries to come into the market with solutions. Thank you, Chair. Thanks very much, Nazim. So, we go straight on to Abebe. I'm collecting questions and ideas, but I'll be back. Then if we have Abebe. Yes, thank you, Haroun. Can you hear me? Yes, we can. Okay, thank you very much. Let me, of course, allow me to thank the organizers and myself for giving me this opportunity to share my experience of user employment and challenges and prospects in Africa. So, what I've decided to do basically is just summarizing very, very briefly what have I learned in the past, let's say decades since I started working on this topic, particularly just descriptive work at the African Development Bank leading a report on user employment. I think the first good report we did was in 2012. I encourage the audience to look up the African Economic Outlook 2012 edition and then the African Economic Outlook 2019, 2020 edition. And some of the work I've done, let it here at ARC, how from the research perspective to understand the policy conundrum, I think when I was listening to Nadeem, it's basically deep into the finding solutions to this serious problem that we have in the continent on user employment. So, what I'll do is give the broader brush of where we are when we speak of user employment and hopefully some of the issues less emphasized in the discussion, the debates that are taking place currently all over the place. Probably I may have to risk repetition. I didn't participate in the keynotes address, but I hope it will not be too much of the same thing. So, I think if you look at the evidence on user employment challenges in Africa, it's evident that it has not changed, actually it's getting worse. If you look at the data a decade ago and let's say the recent one, still the percentage of the unemployment that we use are almost twice compared to the other, the recent figure I got for 2019 from the Afro barometer that surveyed 34 African countries clearly shows that overall unemployment rates in Africa, the weighted average is around 32% both rural and Arab and the unemployment rate among the youth defined as those between the age of 18 and 24 is around 58%. So, this is quite a significant milestone when it comes to the challenges of unemployment and the numbers have not changed in the last decade and also I think when I compared it with what Harun also shared in his recent paper physical is the numbers are very much the other dimension of user employment in Africa is the composition of the devil forces also changing where the proportion of the educated young people is rising and I think when we speak also of Africa I would tend, you know, we are speaking of different economies, you have low income or poorer African countries middle income African countries we call them low, middle income African countries and upper middle income African countries when you look at the challenges of employment across these economies they are quite different in their nature and complexity safe organisms you get too many bad jobs in low income countries while you get for instance too few jobs in middle income countries and there is a lot of variation across those countries the focus I think of policy and decision makers across Africa has been I think I will come back to that just a moment the sustaining economic growth has been I think the focus of decision makers in the continent but if you look at how for instance GDP growth has been conducive creating decent jobs the correlation is not very encouraging for Africa we have what you call one of the lowest growth in the history of employment in the world so we suggest just continuing to focus on boosting economic growth at all to give a solution to this rising challenge of user employment now when I try to describe the challenge from supply side of labor market I think what was mentioned earlier about skill actually let me even take a step back and talk about the use bulge most of us are very happy the African labor force is young but really seriously that bulging labor force is in many ways unproductive from the perspective of skill very skill deprived youth population we have very much well uneducated unprepared for the labor market there is a lot of literature on the learning crisis and the health aspect is also a significant African countries very slow progress status after all exposure to malnutrition at a very young age needs to low cognitive capacity so the supply side really even if we have the numbers the quality of that labor force is very much in need of scrutiny the demand side we've seen I think a number of research including de-industrialization pretty much de-industrialization in Africa is now more or less evident now what does that mean I looked at for instance in other works that I did the enterprise from 18 African countries collected by the World Bank to look at the dynamics of foreign growth in Africa it tells you a very very sad story there is a very slow growth of firms across all the 18 countries covered by the survey high exit rates and low entry rates and also these survival rates of firms in terms of operations there is no small businesses do not grow into large businesses there is so much discontinuity in the profile of firms as a result they are not able to generate decent jobs some of the most important reasons they have given actually it's not even skills it's not even power outage it's not even infrastructure the top five leading constraints faced by firms in Africa the management of property rights and contracts political instability so we have computed for instance the continent loses close to four million jobs a year because of firms dying out of the business for reasons mentioned here the other part of course I mentioned is pretty much industrialization when you look at the labor market operations Nazim has put it very well so I don't go into the details we have a significant evidence on mismatches in the labor market significant divergence between social habitance and private returns to education and also nearly universal failure active labor market policies we'll come back to this in the discussion like training encouraging microenterprises subsidies all of this combined a traditional approach to promoting jobs in Africa doesn't seem to be working so what are we saying I conclude by just mentioning a few policy options one is this when governments are advised usually they ask economists which sector of the economy can you tell us how the highest potential to generate decent jobs is one of the serious questions policymakers ask and the tools we have to answer those questions are not really suitable recently for instance ARC sponsored research is based on the social accounting metrics for an economy and you look at for instance the internal changes and then generate what we call the employment and then multiply how it shows and then you select the sectors with the highest potential in generating and impacting employment and the results across eight countries at least from my reading didn't really answer the question actually it gets you even more confused so the answer in my view is one of the problems productive capabilities I think economic complexity issues I think these are some of the literature and analytical tools that can help for policy methods to look forward instead of to rely on the past economic structure which is already constrained by so many factors to give you an answer in my experience is that most national development strategies across Africa are anchored on maximizing output not jobs and significant details in removing binding problems for creating decent jobs are overlooked I mentioned this analysis of economic complexity and productive capability could offer significant insights in the direction in which decent jobs could be created finally I think strong foundations in basic literacy education competencies etc they offer a lot in terms of improving even the economic complexity itself so if you look at the African experience the public finance and efficiency in terms of running primary and secondary education is quite pathetic the numbers tell you Africa is the least efficient region 58% 41% primary education in terms of learning so with this I think I just conclude by saying the policy options require significant shifts in the decision maker's attention from just focusing really GDP growth in the ways they have understood it but rather to have a very forward looking and visionary and I like the innovation that as you mentioned to tackle using present challenges in Africa thank you so baby thank you very much Ryan over to you I guess I'll start with something light hearted I trust you won't cut my mic that I should say we're about 12 hours away from a African country becoming a finalist in the World Cup and we're about 5 days away from an African country being the champion of the World Cup Dima Magrib I was going to wear my lions of the Atlas shirt today but I didn't fit the dress code I'll start I'm part of the Millennium Challenge Corporation we're a bilateral donor for those who aren't aware relatively small respective to sort of our sister agency ID but whose focus it is to partner with a select set of countries to reduce poverty through economic growth and as perhaps the only someone maybe will correct me perhaps the only bilateral donor in the world whose primary objective is economic growth what we found is you know our our process begins when we're partnering with a country with the question of what's constraining growth with as Nazim referred to earlier that sort of long term question of the tide that rises all boats and sort of being targeted on that so now that I'm done with my sort of propaganda of who I work for I will say that that sort of I'm asking that question of growth as the sort of primary driver of large investments changes sort of how we think but you know I do think that you know the one of the problems that we see in unemployment and trying to deal with the employment crisis and these three transitions or perhaps for transitions that were referred to in Oriana's that skills training programs largely active labor market programs overall can't make up for a shortfall in demand in the labor market and but that's sort of generally what they tend to be most used for is oh there's there's not enough demand in the labor market let's train some more people so they'll you know they'll be better off better suited in this bad labor market and I think you know that reveals why we have the sort of large repository of evidence that of all the things that we know that don't work all right yet we continue to do them and I think that that is sort of the sort of turning towards the some of my reflections as I was trying to come up with something reasonably interesting to say to a group of really well-developed labor economists and other development economists is that you know whether it be sort of all of the evidence around people completing these skills and training programs and you know numbers in the teens and sometimes even into the single digits of people actually working in the field of study that they were trained in right that at first glance tells you that they're doing all sorts of vocational training and other training and jobs programs and these people are not even going into the field they've been trained for so what was the real value of that training is a sort of first level smell test concern and then yeah you know this the study that David McKenzie has done and others around you know that says something like three people out of every hundred trained get a job they wouldn't have already had but I think the reality is hard to do or that attribution is hard to do but you know those two facts combined certainly makes me worried but I think the reality is that this is more of a political response to a mandate around unemployment that a policy response right I think most people in this space know that a lot of these programs are not an effective response I think governments don't want to wake up to don't just train a bunch of people when you see that they don't have jobs but sort of find the underlying drags on on growth but I but sort of I'll give it just three three other quick thoughts on sort of how do we what I call a short circuit that sort of bad policy response or perhaps political response to a real policy response is unemployment and unemployment and a few ways that we've started to think about doing this you know to try and move that needle is first in using more and better labor market data and putting getting that into the hands of job seekers and policymakers we're really doing this to get effect you know crossing my fingers in Morocco trying to you know it really isn't a pipe dream anymore the idea that we could start bringing these different sources of data together in a way that makes it really accessible to the job seeker who is a is struggling with what do I do what do I put my time to be productive I think that I'm not a advocate for like let's just produce more and more data and that'll solve all the problems but I do think that it's no longer sort of overly sanguine or overly optimistic to say that we actually can we're starting to get to the point where data can be manipulated in a way that's really agile and reactive and able to help job seekers in a way that it was sort of silly even 10 20 years ago to say oh I'm sure you know just give these people who don't have skills for digital competencies a bunch of data and they'll then know what to do with that data but I do think that like the the capacity there is growing and that's a promising direction second sort of another way to short circuit some of these unfortunate directions that employment policy has gone in recent years is sort of pushing and I think this is really coherent with what Nazim noted earlier is that pushing programs more towards the question of delivery like how are these programs making these programs more efficient on the delivery side rather than just let's build more buildings where we can train people to become plumbers or mechanics or electricians or what have you and changing that focus towards delivery one of the ways that we've been trying to do this is you mentioned it Haroun in my bio the results-based financing as a tool to sort of change the dynamics to put sort of the power back into the hands of beneficiaries or participants of the programs the job seekers themselves and what I mean by that is in a lot of programs you know the sort of broad range of employment programs we're paying for just trade completing trainings some you know some stuff you bureaucrat like myself in a central room somewhere saying oh well we don't we need more nurses there's not enough nurses let's train more nurses and sort of then chasing that and I think that there's two problems want with that one is it it may not reflect the realities of what's actually feasible but also you're always chasing the problems from ten years ago right we may have a shortage of nurses today but by the time we've sort of rolled out a big you know nursing competency skills program because we know that that is a really in demand a really in demand field we've sort of we're behind the curve and we're sort of training people for skills that were really in demand two to five to ten years ago and so making governance models around these programs not just sort of testing something or this pops up digital skills are really critical today sure they're critical today will they be critical or will we have an oversupply and a glut five to ten years from now and sort of trying to figure out how to to be more agile and how employment policy is reactive to changing economic structures and some of these transitions that Oriana talked about earlier I'll wrap with sort of a broader field which is you know something that I'm passionate about as somebody who sort of does evaluation but also is in some of these conversations around policy is that you know research to policy partnerships are really critical in domains like labor economics where you have really intractable political stasis in many countries most countries you have intractable political stasis where the current order is bad but there's a reason why it stays that way and so being able to you can't just sort of have the right solution and expect it to happen when you have those factors and the way that I've seen be really an interesting way to deal with that in Morocco in particular we're working on this but is you know being able to set up researchers academia in a place of having policy influence on an at an active level and waiting for political wins to shift waiting for the stars to align and that's about all you can do I mean there are sort of interesting programs around advocacy to try and change the political dynamics of why why for example you know formality informality sort of rigidity is so problematic in some countries why you know why it pushes so much activity into the informal sector that's lower productivity and so just being able to move that dynamic of allowing research to have policy influence but also recognizing that when political stasis happens you know you may not be able to change things at the drop of a hat because you had a good idea and just the the last thing I'll say is that Oriana's presentation both made me question everything here and whether or not any of the things I had to say were good ideas or bad ideas also questioned whether or not our agency should be about poverty reduction through economic growth or economic growth through poverty reduction those are some existential questions that we deal with but I will say that I do think that it's sort of the particle theory wave theory conundrum of what she described with these employment transitions vis-a-vis sort of Ricardo Hausman, Danny Rodrick, Andres Velasco's work on productive know-how looking at exports what countries are capable of doing and what is it able to export effectively and able to use that complexity as a driver of growth so thanks so much I know I went about a minute over but I hope we have an interesting conversation right thanks Ryan thanks Arun and good morning everyone so thank you to my fellow panel members for sitting up my little speech so well so I'm here even though I'm a policymaker I'm actually here on behalf of the youth employment sector and this is a partnership between government and the private sector to actually create jobs for youth so this is an experiment in a sense a response to a challenge phase and in fact this happened it started in 2018 when it was then a new president drama came in and through a challenge out to CEOs to say you know you have to get involved in tackling some of the big socioeconomic challenges that the country faces and this is one of the ideas that came out of there so the youth employment service initiative is a private sector led initiative but then a partnership with government and labor at the same time and of course the issue that we're facing in South Africa is that if you're looking at youth between the ages of 18 to 25 there are about 7 million people that aren't employed and if you can't get your first job then you have an almost zero probability of getting a second job and if you can't make that transition from school to work and to Faisal's earlier point about the disjointer in government that transition is really badly managed and so if you can't succeed on your own which is unlikely for so many youth that are disadvantaged by poverty by spatial inequality and by a whole raft of disadvantages then you're pretty much on your own so the idea behind youth is that sorry the idea behind yes is that we go into disadvantaged communities and seek out talented youth in the area there and they're placed on a 12 month program what we call a quality work experience so it's different from the learnerships, workerships, other kind internships all of that the idea here is that you really get a quality work experience because the research shows that your probability of securing employment if you just have this foot in the door is so much higher so we get people in we take about we take students and they about 60% of them come from households where the primary income is a grant about 91% of them actually have dependence of their own so the impact is quite huge when they can get their foot in the door and then become employed and so they put on this 12 month program the way it works is that the partnership is at the business level we're working with mainly JSE listed companies and they can either absorb these youth into their own companies for the 12 months or in a way of creating shared value if they don't have capacity to absorb the youth into their own facilities for whatever reason they can still join the program and actually send these youth out into other businesses these are NGOs or organizations or even where often the need for capacity is quite high but then they don't have the income to kind of fund this so you can you know businesses often then send youth into these other what we call host businesses as well and over the course of 12 months they don't just learn these technical skills but they also are provided with a smartphone which is preloaded with all sorts of soft skill applications to the point Faisal you are making about these psychosocial issues so they're all sorts of modules that they have to complete around soft skills so how do you speak how do you turn up in meetings which we find are things that are also very important for employers and not also well managed in this sort of school to work transition the apps that they use also help the program to track their progress over time and so with all the data that we collect at the end of the 12 months they are provided they walk away with a CV a certificate of completion and most importantly a referral letter and our own statistics show that with the referral letter for women in particular I don't know what the bias here is but for a woman a referral letter more than doubles your chance of landing a permanent job whereas having completed the program and with this set of certificates your chances of getting a call back from an interview more than three times what they would be otherwise and so we find that once people graduate from the youth employment service program they either go on to form their own businesses which is great in the sense that they then become employers or they're able to land permanent jobs so at this point about 46% of the program's previous cohorts are permanently employed and that's about double the national average so while we don't pretend that yes is the solution we're clearly going to have to have a range of solutions that speak to the different segments of the labour market at this stage and so this is just one you know completely self-funded in the sense that there's no government funding involved here it's private businesses organizing themselves and being able to make quite a significant impact certainly for the youth that come through the program and then for the job opportunities that they're able to create thereafter so at this point after about four years of existence the program has created close to 100,000 job opportunities like this and we've been able to inject about 5.2 billion rounds into the hands of those as I indicated who really come from the most vulnerable households so of course there's an opportunity to scale this up as we can get more businesses on board particularly the SMMEs and I think it makes a wonderful example of what can be achieved at relatively low cost certainly zero cost to the FISCAS and relatively low cost to the businesses that are involved and still have quite a significant impact thank you that's it for me thanks very much I'm going to open the floor to questions even if they are clarifatory questions of clarification for our panellists I mean because I know there was a lot of sort of South Africanisms in there I'm looking around and so while there we go I have a question over there on the side thank you hello my name is Fiona I'm actually at the front end of job creation in South Africa I run a youth employment accelerator and we're a proud national Treasury jobs fund partner and a proud implementation partner for years so lovely to hear what you're saying I think just to share an observation and the question back to the panel around corporate South Africa or corporates in creating jobs what we find is we spend a lot of time trying to convince corporates to change their view on young people and young people as talents and trying to create job opportunities and actually as a not-for-profit that is probably a vast percentage of my time spent doing that so the question is how do we talk about the statistics of unemployment and young people without jobs without creating a negative connotation around youth as talent and how can we think differently about how we present back the data about how talented our youth really are we've created over 3,600 jobs in the last three years for young people so we know that they're amazing I'm going to take two more questions and then we'll come back to the panelists and each have a chance to respond and then we'll close off Thank you very much Michal Rutkowski from the World Bank I have a South Africa specific question I would be interested in panel's recommendations about SRD 350 whether this grant should be paid in eternity or should it be conditional upon some actions of its recipients or should it not be additional but there should be some behavioural nudging or some one-stop shop in which the recipient of the grant must at the same time demonstrate certain actions or maybe load the devices you are talking about I think last speaker talked about on their mobile phones the ones that improve soft skills and the second question also specific to South Africa I'm interested in panel's view whether wage subsidies in your view are a good way of moving forward on the surface one could think that if there is information asymmetry and the graduates do not signal their skills having a time limit at wage subsidy might be a way of breaking it and allowing for employers having informed views of their potential employees but my sense is that they are not much in use. Thank you No, thanks. I enjoyed the panel discussions several points I want to pick up on the issue that I heard a lot was about constraint diagnostics and I do agree in some views that active labour market policy is not the only method there are a lot of factors out there the issue that even in most developing countries when we have political issues how often do they look at the statistics in the United States you have oldest net etc supposed to help us understand how job replacement goes we often know in emerging developed economies often it's through replacement that's the big issue most jobs are created because of retirements replacement so you know what the skills are the challenge I think we're often facing an emerging developing economies we're also seeing a lot of structural transformation so how do we determine what occupations are going to be there so Ryan I fully agree with your point how do we know what jobs are going to be there in the next five to ten years and part of the occupational forecasting can help us with that but we also know and I'm going to say this Haroon don't get me in trouble for this one countries never went to invest significant amount of resources and data collection and data analysis and we actually need that so again with the millennium project how do we actually pivot that because what I actually heard is oftentimes it's not the skills that were often are not the biggest constraints in firms as we heard but they are part of it so we need to really think about the constraints at the sectoral firm level how we deal with this the other question I just have very quickly Haroon we talk about unemployment youth unemployment normally speaking runs about twice that of adult unemployment that's one issue the other side of that is how many of us in this room I'll ask the question and I do this to all new staff can tell us the definition of unemployment and oftentimes we're going to find I think we kind of hinted around this the real issue is not often unemployment but under utilization and how we transition people in so how do we do that so okay I'm going to sneak in a question and give you two minutes to answer all of them but my quick question is it was sparked by Ryan's comment is I'm going to set it up do you think if as policy makers who know a lot about the space if you had a dollar to spend would you go for interventions on the supply side of the economy so firms or would you go on the supply side of the labor market so i.e. training versus subsidizing whether it's the informal sector or formal sector so that's just a question for you to consider should we just go in the same order that you spoke so Nazim first yeah I'm going to try and answer if I missed something please remind me I think I'm going to talk about the social grant issue first the point is the social grant issue cannot go on forever simply because the minister of finance has been very clear that he is not in favor of doing this into perpetuity he's very keen on having certain conditions to that grant i.e. progression in terms of learning, development of skills etc and actually going out there and looking for a job because what is very conscious of is the level of grant dependence that we are creating by doing this so he has been he's pronounced on it, he's been very clear at the moment the grant has been extended and it's really a poverty alleviation issue at the moment but the minister has been very clear that he's looking to transition that going forward or sorry to change the manner in which that issue is addressed then I want to talk about the issue of how we transition young people and the way subsidies that we use so in South Africa there is an understanding and acceptance that our systems and ecosystem for transitioning young people from education into employment is not efficient enough and that is precisely the reason why in I think two years ago the presidential youth employment intervention was launched a key function of that obviously we've got demand activation, supply enablement but a key part of that is the pathway of that young person from unemployment into opportunity and that opportunity is either a job opportunity, a learning opportunity a training opportunity because we recognize that the methods that is currently being used to do that is inefficient not working so the national pathway manager network has been established it is operational at the moment and its specific role is to find better ways of pathwaying young people into opportunities so the next thing I want to talk about is really around the way subsidies so many of our our work seeker initiatives i.e. matching unemployed young people to opportunities that do exist involves the payment of a stipend okay and there was a discussion at one of our investment committees as to for how long does that go on because very few other countries do that so what happens is in South Africa we place a young person in a training program to develop the skills and ultimately hopefully place them as long as they are in training we pay them a pit stipend right to stay in the program and what of course that does it it grows or basically the cost of the program becomes in many ways unsustainable and we've got to find a way of doing it better doing it more efficiently and that is currently something that we're thinking of thanks Abebe yeah Harun I think most questions are directed to the experience of South Africa but just to pick up probably a few issues one about how do we define unemployment or the unemployed I think there are standards I think definitions used by the primarily ILO researches I find the one which defines someone as unemployed who is who has reached the age of employment usually 18 years so not in education not in employment not in training so if someone is not in any of these categories we classify that person as an employer then you know the rest forms into places but overall I think from the spirit of the discussion my sense is the government is not a job creating entity government is a faceted jobs are created by the private sector if you look at the data even from the poor African countries I have it right here in front of me those who say they are employed at least a significant portion of the employed are self-employed first they create their own livelihood even though it's vulnerable it's not sufficient to survive the poverty condition they at least strike to create their own source of life the second important sector that employs is the private sector if you look at the 2019 data for Africa for the adults about 15% of them were employed by the private sector and for the youth about 10% the government employed 9% the adults and the 2% the private the youth so in any country which strives to create decent jobs the government requires to understand the economic dynamics the government requires to understand what the country is adding its comparative advantage the details of course are not subject I think our discussion but the government needs to have a vision where the country needs to go and provide the incentive for the private sector to lead into that vision so my sense is there is supposed to be a policy coordination and understanding between the private sector and the government so that the government is not an hindrance but rather a facilitator for the private sector to flourish, to emerge and grow, I mean the evidence in Africa shows you all over so much constraints the private sector faces in running business it's so difficult to run business in Africa so I'm very happy to hear it controlling from non-vibes presentation I think it's a great experiment in creating the labor market conditions removing the constraints between the employers and the employees once looking for a job has worked very well that is where the focus needs to be prepares again for the future thanks I'll be extremely brief but I think that the question diagnostics is a good one I personally have found that the growth diagnostics framework as well as modifications that have been done therein to ensure you're not just targeting easy sources of growth that aren't inclusive but largely that heuristic approach is the best approximation we have to quantum mechanics in economics of sort of trying to understand all of these different components of what's driving this sort of symptom of people's time, labor skills being underutilized which is effectively a symptom of a system and then to maybe answer your question Haroun around which bet would you take I think the graphs that Oriana showed earlier are really reflective of what part of that which phase of that transition are you in and I think my instinct tells me that in Morocco is that I know most closely and South Africa you're sort of in that glut where you're no longer at that place in the paradigm where you're talking about everyone basically self-employed you're trying to move that you're already sort of past that very low productivity place but what are the dynamics that are constraining the firm and then secondarily this sort of fourth transition we talked about a little earlier which is technologies which allow you to be your own firm the uberization of self-employment which is not the same self-employment that who's producing their own tomatoes or stable crops at home is that so to answer the question I think it depends on what place you're at my gut instinct is that most middle income in emerging countries are not at a place where the supply of skills is the real constraint and that really we should be working on what is it that's constraining firm growth much more so than you know let's make the skills that much more adapted oh kids aren't good problem solvers these these darn kids let's let's make them better problem solvers and then we'll have massive economic growth in low unemployment I think we're not in that place in most emerging and middle income markets thanks sure so I think gosh some really interesting questions I mean I think the reason we're all gathered here is because this is these are not easy questions to answer right so there isn't a silver bullet it's not going to be one thing so starting with your question Haroon I'm going to reject your attempt to simplify it and ask us to choose between supply side interventions or labor market interventions I'm going to say it obviously has to be some combination of both and what we're trying to work out is what that optimal mix is in the South African content and then also context and also in the African one linked to that question around our wage subsidies a good idea in South Africa I mean we already have one in the form of the employment tax incentive and it certainly makes its contribution to the mix but it clearly as within all of these programs isn't going to be the one thing that shifts the dial in terms of the 350 grant and making that permanent I think Faisal has already indicated what the formal stance is which is that if you're going to have a permanent increase in expenditure it must be matched by a permanent increase in revenue so unless someone can until someone can come to us and tell us well here it is that's going to become that's going to be something that's just on the wish list having said my personal view is that I do think something like that should be should be rolled out if we can afford it and certainly conditionally tied to some sort of job seeking efforts I think would be a good intervention in South Africa's case if it didn't have a negative impact on our fiscal balances and then around changing the perceptions of youth I think it really comes back in my view more to the question around growth and the content of growth and how that works because I just think in the South African context in survivalist mode right so you come to them and you say yes this person and this investment is going to pay off for you in five years and they don't know where they're going to be in five years located in the country or bankrupt so I don't think it's so much about perceptions of youth I just think we're at a point right now where creating jobs is difficult enough or maintaining the jobs of the people you already have is difficult enough that for business to sort of bend their minds in that direction I think it's just a real challenge and I think I'm going to leave it there thanks Aaron great I'm not going to summarize I just want you to join me in thanking our panellists I think it's been a great session I'm going to please don't move I'm going to hand over to Kezia who's just going to give you the running order we're all very confused where are we in the day we're going to go now to the parallel sections theoretically the morning but it's now the afternoon so you'll find one venue on the level above us and then three venues on the level above that can I ask that if you haven't yet given your presentation to Jeanine you need to go immediately to that room that you're in and give it to someone who has a flash drive there because they'll be waiting for you if you're chairing that session please can we end it strictly as far as possible at 140 so that has that time has not been cut you so have you one and a half hours we'll then go up to the roof for lunch and we'll aim to finish our lunch and be back for the afternoon parallels at 220 so how 40 minutes for lunch so you'll finish your morning parallels at 140 have your lunch and then be in the afternoon parallels at 220