“South Africa should be tackling the rising unemployment rate by facilitating and driving entrepreneurship.” This is according to Christo Botes, spokesperson for the 2016 Entrepreneur of the Year® competition sponsored by Sanlam and BUSINESS/PARTNERS, who was speaking in light of the recently released unemployment figures.
Statistics SA yesterday revealed that unemployment increased to 26.7 percent in the first quarter of 2016, up from 24.5 percent in the previous quarter, making it the highest rate since the labour force survey began in 2008.
“With rising interest and inflation rates as well as low growth expectations for South Africa – expected at 0.6% this year and 1.2% in 2017 – local businesses are increasingly facing the pressure and this impacts employment levels.”
It is during such challenging times where entrepreneurs can play a significant role in driving economic growth, says Botes. “Despite slow economic growth, South Africans have proved to be resilient and standing together in times like this. Entrepreneurs are ready to capitalize on opportunities and society at large needs to dedicate more resources to identify, facilitate and promote entrepreneurship as the answer to creating jobs and wealth for all. Entrepreneurs and small business are typically more nimble and flexible to capitalise on the gaps created in the market from economic difficulty.”
Botes adds that he welcomes President Jacob Zuma’s recent announcement of a plan for government and business to set up a joint fund to support small businesses as part of Government’s short-term interventions to boost economic growth. The joint fund is expected to provide funding and support for entrepreneurs. The private sector already committed R1.5bn towards this joint fund and it is expected that government will match this amount to start off this fund with R3bn in total. It is expected that this fund will be expanded to R10bn in the near future.
He acknowledges that entrepreneurship can be daunting, even for those seasoned business men/women with years of business knowledge, and that is the reason such initiatives – as mentioned above – are needed in the country. “While very rewarding, entrepreneurship is also a tough journey, and entrepreneurs need to be supported to grow their businesses to levels at which they can positively contribute to job creation and economic growth. The country needs to be providing the right guidance and infrastructure to motivate and encourage entrepreneurs to embark on their own business.”