While Small, Medium, and Micro Enterprises (SMMEs) feel positive about the energy that young people bring to the workplace, Youth Capital’s research highlights that one in two business owners struggle with hiring young people because they don’t have the necessary experience, or lack critical workplace skills. The survey was part of research run by advocacy campaign Youth Capital, to identify the challenges that SMMEs face when hiring and retaining young people – the findings are available in their latest report, Bridge the Gap. Finding the ‘right’ young hire.
As youth unemployment continues to be a national crisis, the role of SMMEs has become critical in absorbing young talent. Even though they make up 40% of the GDP, and between 2016 and 2019, small businesses created more than 1,800 jobs per day, their challenges are often unrecognised and unaddressed.
Bridging three gaps to put the needs of SMMEs first.
Bridge the Gap reveals that although SMMEs have a critical role to play in combating youth unemployment, many enterprises face three main gaps: lack of the right skills amongst young hires; lack of knowledge on the correct hiring and onboarding processes; lack of awareness on the government incentives that exist, and how to access them. The report also acknowledges the role and the potential impact of an ecosystem where SMMEs, decision-makers, and youth employment programmes align their work to improve their outcomes.
The insights from the report were further unpacked with Luisa Iachan from the International Labour Organisation, Author and Chartered Accountant Khaya Sithole, Bentolina Nnadi – Mama Money’s Head of Talent, and entrepreneur and ONE ambassador Eniola Price, in a Twitter Space co-hosted with the ONE Campaign.
In the conversation, Luisa contextualised the importance of small businesses, globally.
Startups and SMMEs are a driving force of innovation, of sustainability, of economic growth and. Also, particularly of employment generation. There’s solid empirical evidence that SMMEs are a major job creation engine and over 70% of the total global employment is provided by SMMEs.Luisa Iachan
Khaya Sithole painted a realistic picture for the South African context and the South African problem, with deindustrialisation, and the presence of a few, concentrated players. These factors have a huge on small businesses’ inability to determine financial growth for the country.
The consequence of that is that obviously employment prospects are essentially limited, because they are defined by the capacity of those big businesses at any point in time to absorb workers. And we do know that they do reach a saturation point. They probably reached that saturation point many years ago, which simply means that even if you had the best skills out there, those people simply wouldn’t get a job because of the capacity of current employers to absorb new skills quite simply isn’t them. So the problem you have with the South African case study is that SMMEs are not thriving on their own. And if they struggle to thrive on their own, it becomes very difficult for them to inherit this additional responsibility of driving and facilitating employment opportunities.
Khaya also outlined the existing incentives and their inherent inability to increase hiring, if the economy’s outlook does not favour growth and labour absorption.
Bentolina Nnadi, who contributed to the Learn & Do section from the report (which includes a toolkit on how to improve hiring and retention practices) highlighted common mistakes that small business owners make, when looking to hire young talent; she also shared tips on simple solutions that help the hiring team understand the values, skills, and behaviours required by individual positions more clearly.
As a company, we started defining very clearly what our core skills, but also what are nice- to-have. And I think sometimes we mix all of these things and expect the person to come with, you know, all of the things that we desire, and it’s important to differentiate what do you absolutely need in the business and for this role to be successful and what are nice to have and and things that the individuals can also learn on the job and and leaving that room for development.Bentolina Nnadi
Bentolina also emphasised the importance of setting key performance indicators for the first 30, 60, and 90 days of a new hire (probation period), to ensure that the new person has enough information on how their performance will be rated.
Entrepreneur, Eniola Price shared his experience not only as an entrepreneur but as a young person, and focused on the role that support plays.
You need a support system. The journey is not for only you alone. You cannot exist in isolation. So you need a support system because there are days that you feel down. You wouldn’t believe in your own idea yourself. So you need a support system, you need external family and friends, but you need internal support. For me, the internal support system is music, arts and culture, movies and taking long walks.
Listen to the panel discussion here.