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Picture: SUPPLIED/BDO SA
Picture: SUPPLIED/BDO SA

As the country’s national budget is tabled, it is critical to analyse how effectively our Treasury budget supports and funds solutions for growth.

The budget is an expression of the country’s economic strategy; thus, it is useful to analyse it with a forward-looking perspective. We need to ask ourselves how well we as a nation are preparing our people to participate and compete in the future global economy.

In his state of the nation address (SONA), President Cyril Ramaphosa made encouraging commitments to training for the jobs of tomorrow, following the presidential jobs summit and other initiatives.

However, looking to the future means we have to critically assess our country’s formal education system. SA already allocates a higher proportion of our gross domestic product to education than most developed nations. The problem is that this spending has not translated into better outcomes that drive growth and provide the global economy with the necessary skills.

The SONA speech was replete with references to the Fourth Industrial Revolution, but we need more concrete steps and strategies to embrace it.

There are signs of a paradigm fixation among some people in SA – an obsession with the way we did things in the past. We still appear to be hoping that foreign direct investment will lead to millions of manufacturing jobs that will absorb the oceans of unskilled, unemployed people in our country.

The reality is that we are not only living in a changing world, but also in the midst of a “change in the conditions of change”. Change is accelerating, and yesterday’s principles are not necessarily applicable any more.

As the phenomenon of polar drift has seen the shift of the magnetic north pole accelerating in recent years, so has economic and technological change sped up in recent years. The economic evolution we have always taken for granted is now so rapid it is almost unrecognisable.

SA’s education strategy is not keeping pace with these changes. School textbooks, in trying to prepare children for their roles in the economy, cite traditional careers and fail to mention recent additions to the jobs market. There is no mention of jobs of the future, which will come on stream a decade from now when today’s learners enter the employment pool.

We are still fixated on manufacturing and the industrial age. The “demographic dividend” – our vast population of young people – is held up as a national asset. However, this very concept might be a function of dated thinking, considering technological advances

According to this theory, traditionally, if a country has a huge young population and it is well educated, healthy and productive, this can represent a demographic dividend that translates into accelerated economic growth. Africa has that opportunity, but where the youth are unemployed and not educated with relevant skills, it can represent a liability instead of an asset.

Again, when we experience a change in conditions, this theory might not be so relevant anymore. With accelerated business automation, countries with declining populations are finding new efficiencies beyond demographics. In this context, the Fourth Industrial Revolution can work against countries with large young populations – not to mention uneducated youth or youth with the wrong skills.

The change is a significant challenge. While we continue spending so much of our money on education, we may not be spending it in the right areas.

The president’s SONA speech admirably committed the education department to expand into new-economy areas such as technical mathematics, technical sciences and aquaponics. This is to be applauded.

However, the government should build accountability into the allocation of funding to ensure it supports future-fit training. It would be useful to place conditions on the allocation of funds to primary, secondary and tertiary education to ensure they are spent to train learners in relevant modern skills.

There may even be a need for a kind of steering committee to direct education strategy with the Fourth Industrial Revolution in mind. If we change education now, we will begin harvesting the fruits of that within 20 years at the soonest. Only at that point can we start to compete with the outside world.

The corollary is that if we cannot do that, our people may be rendered unemployable.

We need to provide new-age services and technologies for the world. If India can reinvent itself as a technology hub, we can too.

Software coding skills, for instance, should be democratised and transferred to tens of thousands of South Africans. This will almost guarantee them employment in the emerging economy. Coding should be a blue-collar skill learned in a few months, not an elite, white-collar field requiring three- and four-year degrees (only a few people need degrees in systems development).

About the author: Michiel Jonker is IT Advisory director at BDO South Africa. Picture: RUSSELL ROBERTS
About the author: Michiel Jonker is IT Advisory director at BDO South Africa. Picture: RUSSELL ROBERTS

Other skills that will be in demand in the new economy will not necessarily be highly technical or digital only. These will include skills like social intelligence, adaptive thinking, deep generalist thinking and the ability to filter information.

Transferring these skills may require an overhaul of our educational paradigm. We still require specialists – one should not allow just anybody to conduct brain surgery, for example. But in many sectors, we will need people who understand multiple disciplines and the complex ways that they interact.

These needs of our country should be reflected in the national budget. The budget expresses our national priorities, and right now the priority should be making our people future-fit. We give South Africans the best chance of a better life by equipping them with skills that will be relevant in the future.

For more information and budget guides, visit the BDO South Africa website.

 

This article was paid for by BDO South Africa.