What small businesses can do to activate and empower the youth in entrepreneurship
With a 55% contribution to formal employment in South Africa, there is no doubt that small businesses have the unparalleled potential to take South Africa’s economy to heights that will see the youth unemployment rate (which currently stands at an alarming 55.2%) declining exponentially. So, if you’re a small business owner, kudos. You may well be the sole surviving hope for reviving this country’s economy.
Currently, there is a big economic problem in South Africa. Small business growth is stagnant and has been since 2008, while the youth unemployment rate seems to remain more or less as alarming as ever. The answer is simple: small businesses urgently need more robust support structures and the youth needs to get far more involved in entrepreneurship. So, how do existing sustainable small businesses reel young people into the world of the self-employed?
1. Hiring young freelancers for work
When a business hires a young, newly graduated IT technician to do some work for them, here’s what they’re actually doing: They are most obviously providing them with direct remuneration and experience. Which, in itself has immense value. Although somewhat limited. The second thing that they’re doing is exposing a potentially risk adverse young person to the possibility of self-employment by providing a direct window into the entrepreneurship experience. Both via observation and the experience of freelance work. The result of which has immense value
2. Involving youth businesses in your supply chain and/or offering non-monetary support
“On average, about 50% of all start-up businesses in South Africa fail within 24 months due to the inability and inexperience of their owners.”Ravi Govender, Head of Small Enterprises at Standard Bank
The lack of experience that often leads to costly mistakes, coupled with the taxing labour of entrepreneurship is enough to lead half of all newly established entrepreneurs to quitting within their first two years of launching their businesses. Half.
As an already established and successful small business owner, the guidance that you can offer is invaluable. Practically, small business owners can invest their time to hosting workshops that are aimed at guiding new entrepreneurs against making mistakes that can cost them their business. Workshops that are geared toward teaching young inexperienced business owners how to survive and be sustainable. And lastly, workshops that aim to offer the kind of emotional support and preparation for failure that entrepreneurs often lack but need.
3. Lastly, just give them work
Small business owners’ can aid in the survival and growth of newly formed youth businesses by becoming their clients (i.e.: adding them to their supply chain). Monetary support is just as important as any other kind of support structure, so it is important to place emphasis on actively sourcing youth owned new businesses to work with.