At the end of 2015 I quit a full-time job and entered the world of self-employment. Being a writer helps with a soft landing, it being a skill that is fairly in demand if you create the right networks.
But I hadn’t quit a stable job at a newspaper to become a freelance writer; that was more of a side hustle. I had bigger dreams and was armed with a concept that was a guaranteed success but required adequate financial support to get off the ground.
With a couple of like-minded friends in tow, we dug in deep into our savings, secured once off donations from various sources and set about creating a news and content agency that would train and dispatch unemployed journalism graduates and final year students seeking experiential training to parliament and the nine provincial legislatures. We trained them, paid them a monthly stipend and covered all the other operational costs. In turn, the content they produced would be syndicated to media houses, government and the private sector.
We almost pulled it off. We took nine young, unknown writers, gave them crash courses on the business and set them off into the various legislatures. They produced content; we cleaned it and sent it to identified partners. Many were enthusiastic about our offering but did not have budgets to support our growth.
Our business model, however, was burning cash and required urgent financial assistance to keep going until it was profitable enough to sustain itself.
Let me tell you, seeking assistance to get an entrepreneurial project off the ground — one with huge employment potential — has to be one of the hardest things to do in this country.
SA hates entrepreneurs.
The financial services sector will not even entertain you unless you are an already profitable entity or you offer your kidney as surety.
If you go the non-profit route, as we did, the administrative hurdles are immense. You go through mountains of red tape, bureaucracy and time wasting. In the end we had to wind it up and let our young writers go. I don’t consider it a failure, and one day I will try again.
Last week, Stats SA released its quarterly labour force survey — a set of depressing figures. It shows that the expanded unemployment rate — including people who have stopped looking for work — rose to 44.4% in the second quarter, up from 43.2%. The number of unemployed people has risen by another 584,000 to 7.8-million. According to a Bloomberg survey of 82 countries, SA is in the unenviable position of having the world’s highest unemployment.
Youth unemployment is at a staggering 74.8%. African females are the least employed of all race groups, with four out of ten not working.
We will never resolve this crisis until government and the private sector get serious about incubating and supporting entrepreneurs.
I get very frustrated when ministers stand on podiums and promise that government will “create jobs”. It might be a politically correct thing to say in a speech but it’s wrong on many levels. It creates complacency; people sit back and wait for the “jobs” government promised.
Seeking assistance to get an entrepreneurial project off the ground – one with huge employment potential – has to be one of the hardest things to do in this country
It’s not the job of government to create jobs. What the state should be doing is creating an environment where the economy can grow and stimulate this job creation. Not just an economy that favours big corporates, whose executives are often incentivised for cutting costs and firing workers, but one that enables small and medium sized enterprises to thrive. That is the only way to unlock jobs. Government and the private sector have a responsibility towards SMMEs by creating a market that will absorb their goods and services. Instead of giving a R300m tender to a single tenderpreneur, why not break the contract down into 50 components and award them to deserving SMMEs? Big business must ring-fence 30% to 40% of their spending on goods and services specifically in favour of their smaller counterparts.
Where is support for technology start-ups across all sectors? Naspers is leading the way through its Foundry initiative that has a R1.4bn kitty to invest in tech start-ups. What are others doing?
Supporting entrepreneurship has done wonders for Israel. The country is not endowed with natural resources but is renowned as one of the most innovative in the world.
“Israel has created the most Nasdaq-listed companies outside the US, is consistently ranked one of the most innovative entrepreneurial countries in the world, and is ranked first in the world for the number of technology start-ups,” Jennifer Murphy, programme manager at Connecticut Centre for Entrepreneurship and Innovation, was quoted by Business.unconn.edu
Indonesia has built an entire economy on SMMEs.
Arif Ramadhan, international relations officer at the coordinating ministry for economic affairs in Indonesia, told City Press that SMMEs were his country’s economic heartbeat, with entrepreneurship a key subject at school.
“SMMEs make up 98% of the Indonesian economy and more than 90% of new jobs are generated by the SMME sector,” he said. The country has an unemployment rate of 4.11%.
In SA politicians make speeches about supporting start-ups and small business, and promptly forget about the sector the very next day. The ministry of small business has been in existence for years; what has it done to support growth of small and medium enterprises? Gauteng boasts about a township economy revitalisation programme, but its townships remain the bedrock of unemployment.
Sit down with seasoned entrepreneurs, and my experience plays itself over and over again with the same depressing results. In the three years I spent in self-employment, I attended countless seminars, where budding entrepreneurs would fill halls and boardrooms to share their ideas and plans in the hope of getting some assistance to get these off the ground. People with far better concepts than ours, who were driven and committed. Brilliant people armed with university degrees who had quit thriving corporate jobs to pursue entrepreneurial dreams, all complained about the same thing ... lack of opportunity. They had knocked on doors, made tons of presentations, but were met with silence or promises that never materialised.
Until this country gets serious about supporting SMMEs and entrepreneurs, we will keep getting shocked by rising unemployment figures each reporting cycle.
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