Higher education is key to improving economic prospects for South Africans
By Shai Reshef, President of the People’s University
Unemployment is the biggest struggle facing young South Africans today. Youth unemployment (15-34 years) has reached an all-time high this year due to the pandemic and the resulting economic slump, reaching a staggering 46.3% in the first quarter of 2021, according to Stats SA. With almost half of young people unemployed and looking for work, a change is clearly needed. And education holds the key.
Data from Stats SA shows that of the 7.2 million unemployed in the first quarter of 2021, more than half (52.4%) had levels of education below the matrix, followed by those with matrix at 37.7 %. Only 2.1% of the unemployed were graduates, while 7.5% had other higher education qualifications as their highest level of education.
The difference between the employment prospects of graduates and non-graduates is so marked that higher education can be described as an economic imperative. The last decades have shown that higher education is, if not a cure, at least a protection against unemployment.
According to a World Bank report in 2019, “the importance of acquiring skills to enable young South Africans to find jobs and earn higher wages, thereby reducing poverty, income inequality and unemployment. , makes the policy to enroll more students in higher education institutions essential ”.
And the importance of higher education will only increase. A 2017 Harvard Business School study found that job postings requiring degrees are on the rise, even in jobs that previously did not require it. For example, in 2015, 67% of production supervisor job postings required a college degree, while only 16% of employed production supervisors had one, according to the study.
Of course, a certificate or diploma cannot guarantee employment. But it dramatically increases a candidate’s chances of success in today’s hyper-competitive job market. It also greatly increases a person’s earning potential. Another dataset from Stats SA, released in 2017, showed that there is a clear increase in monthly wages the more educated a person is. According to the study, a person who graduated can expect almost double the salary of a dropout. A graduate certificate translates to a 67% increase in earning potential and a bachelor’s degree a massive 330% salary increase.
These findings do not apply only to South Africa, but are echoed around the world. A 2014 Pew Research Center study found that the value of a college degree is greater than it has been in almost half a century – the income gap between bachelor’s degree holders and high school graduates is more important than it was for previous generations. Paul Taylor, then Executive Vice President of the Center, said: “The driving force behind the widening gap is not that today’s college graduates are doing better than yesterday’s college graduates; it’s that today’s high school graduates are doing less well than yesterday’s high school graduates. The real story is the collapse of economic opportunities for people who do not pursue their education beyond high school. “
And with the Organization for Economic Co-operation and Development ranking South Africa’s education system among the lowest in the world in 2015, those opportunities are bleaker than ever, especially on the international stage. There are no quick fixes to the economic difficulties the country is currently facing.
But imagine for a second how different those statistics would be if more young people had the opportunity to pursue higher education after high school. Institutions such as People’s University, where I am president, offers such opportunities.
University of the People is a tuition-free online US university, which, with its low fees and internationally recognized accreditation, makes higher education affordable and accessible to all graduates.
As Madiba said, “Education is the most powerful weapon we can use to change the world.