Skills Needed to Drive Economic Development in South Africa

1. Department of Higher Education and Training Skills Needed to Drive Economic Development in South Africa Portfolio Committee on Economic Development 6 March 2012

2. Focus of Presentation • Challenges affecting Productivity, Job Creation and Economic Growth • Mandate of the Department of Higher Education and Training • C. Addressing Skills Needs • Auditing of Skills • Infrastructure Projects • Green Paper

3. Challenges affecting Productivity, Job Creation and Economic Growth

4. Challenges • Failure of businesses in many sectors of the economy to equip their workforce to adapt to change as the economy becomes more knowledge-based • Systemic blockages such as the lack of synergy between the various post-school sub-systems • Absence of coherent strategies within economic and industrial sectors, lack of systematic skills development to support and sustain growth and development • Unemployed who lack basic numeracy and literacy • Unemployed without entry-level skills or work experience

5. Challenges • Urban bias of economic development has resulted in an urban bias in skills development initiatives with skills for rural development being neglected • Over-emphasis on NQF level 1-3 learnerships, with insufficient progression towards skills required for growth sectors in a knowledge economy • Businesses have not been taking on learnerships • Artisanal training has been on a decline • Continuing skills shortages in the artisanal, technical and professional fields that are fundamental to the development and growth of our economy • Inadequate skills levels and poor work readiness of young people leaving formal secondary and tertiary education and entering the labour market

6. 2007 CS: Not Employed, Not in Education Not severely disabled18 – 24 age cohort

7. Priorities of Government and the Mandate of the Department of Higher Education and Training

8. Priorities of Government • Education and Training is one of the 5 key priorities of Government • Cabinet has adopted A Skilled and Capable Workforce to Support an Inclusive Growth Path as an apex priority outcome for this government • A skilled and capable workforce is critical for: • - decent work • - an inclusive economy • - labour absorption • - rural development • - reduction of inequalities • - more diversified and knowledge intensive economy

9. Higher Education and Training Mandate • On the demand side: • Ensure that the skills needed to drive our country’s economic growth and social development is delivered at an increasing rate • Availability of quality skills will enhance both investment and service delivery • On the supply side: • Must serve a growing number of young people and adults • Provide different entry points into and pathways through the learning system • Quality learning wherever learning takes place • - Easy pathways across the different learning sites

10. Addressing the Skills Needs to Drive Economic Development in South Africa • National Skills Development Strategy III • Increasing Access to Occupationally-Directed Programmes • Promoting Partnerships • Consolidation • National Skills Fund • Vocational and Continuing Education and Training • Universities • Skills Development

11. National Skills Development Strategy III • Launched 3rd phase of the National Skills Development Strategy in January 2011 • It builds on the work done during NSDS I and II • Steer investment in education and training and skills development in order to achieve our vision of a skilled and capable workforce to support an inclusive economic growth path and social development • Improved access to quality learning programmes, increased relevance of skills development interventions and building strong partnerships between stakeholders and social partners • NSDS III is a subcomponent of the HRD Strategy and will operate concurrently within the five-year term of the country’s second HRDSSA

12. Increasing Access to Occupationally-Directed Programmes • Established NAMB to lead implementation of the Artisan Programme in November 2010 • Target to produce 10 000 artisans annually in critical areas. Current indications are that the target will be surpassed • 30 000 New learners will be registered by 2011/12 to pursue artisan trades • In addition to the emphasis on artisan development, NSF has increased bursary support for other critical skills and post graduate studies to over R 500 million in 2012 (National Students Financial Aid Scheme / National Research Fund / Careerwise)

13. Promoting Partnerships • Round-tables with business and Labour to facilitate collaboration between social partners in the implementation of the artisan development programme. Formed the ATD-TTT • Advent of the National Skills Accord in July 2011 is enabling partnerships/collaborations between Government, Business, Labour and Community structures in skills delivery • Employers have undertaken to train beyond their needs. Those undergoing training will not be treated as permanent workers • Partnerships with the Swiss SA Cooperation Initiative on developing a single national artisan learner database across all SETAs and economic sectors

14. Consolidation • Through the ATD-TTT processes, development is underway of a sustainable funding and learner administration model and system for artisan trades applicable all SETAs • Trade testing regulations, as contemplated in Section 26d of the Skills Development Act, will soon to be released for public comment. This will finally repeal the last vestiges of Apartheid era legislations, i.e. the Manpower Training Act of 1981 • In order to consolidate the progress made in the area of artisan development, a National Artisan Development Conference will be taking place on 4-5 July 2012

15. National Skills Fund • Work undertaken through the NSF, over and above bursary funding for critical skills: • Training of 6 900 NARYSEC recruits from the rural wards of the country for effective participation in the rollout of rural infrastructural programme • Training of over 30 000 unemployed young people in the countrywide rollout of the Extended Public Works Programme by the Public Works Department • Trained over 3 000 young people in the Monyetla project of the Department of Trade and Industry in the Business Processing Outsourcing and Offshore sector. 77% have been absorbed into full time employment

16. Vocational and Continuing Education and Training • Expanding and ensuring that the Further Education and Training College system is responsive to sector, local, regional and national skills needs and priorities • 51% Increase in enrolment from 2011 • 70% Increase in Report 191 Engineering from 2011 • 49% Increase in Report 191 Non-Engineering from 2011 • 68% Increase in N1-N3 Engineering from 2011 • 4% Increase in N4-N6 Engineering from 2011 • 17% Lower NC(V) enrolment on 2011 • 8% Increase in NC(V) Engineering from 2011 • 19% Increase in NC(V) Non-Engineering from 2011

17. Universities • NSFAS support to students through Scarce Skills and Disability Fund (R 93.8 m), Rural Student Programmes (R 15.3 m) and Post Graduate Funding (R 50 m) • Enable postgraduate students who require financial assistance to complete their honours, masters and doctoral degrees • University Teaching Development Grant - improving the qualifications of academics, improving the teaching capabilities of lecturers, providing student support to improve their academic performance • University Foundational Learning Provisioning - Providing additional support in Mathematics / Physical Science and English so as to enable students to enter mainstream qualifications

18. Skills Development Output 3: • 14 244 Learners have registered in Artisan learning programmes with for the first 3 quarters of 2011/12 • National Skills Fund • - 6 708 undergraduate bursaries were awarded to support studies in critical skills • 1 331 post graduate bursaries • Trade test pass rate increased from 41% in 2010 to 57% in 2011 • 8 898 FET graduates and students from Universities of Technology have been placed in workplaces for experiential training • 4 191 Students were placed in workplaces for workplace exposure whilst studying

19. Auditing of Skills

20. Auditing of Skills • SSP development is a statutory function as stipulated in Skills Development Act and Public Finance Management Act • Must be developed within the framework of the National Skills Development Strategy III, Government’s New Growth Path, Industrial Policy Action Plan II, Human Resource Development Strategy and Governments priorities • Has to be updated annually to reflect new developments • Centred around employment creation and supporting economic sectors by significantly stepping up the production of relevant and scarce skills

21. Auditing of Skills • Currently there are no institutional mechanisms that provides credible information and analysis with regard to the supply and demand for skills in the country • Pockets of private and public initiatives but is unable to provide a consolidated picture • NSDSIII identified the critical role that SETAs have to play in gathering statistics and other relevant information on labour market skills needs and training provision • Transformation and re-focusing of SETAs to bring the development of Sector Skills Plans (SSP’s) at the centre of their activities is underway

22. Auditing of Skills • Department is working in partnership with HSRC and University of Witwatersrand Policy Planning Unit to bring about integrated skills planning for the whole country • 2 Inter-linked projects, financed through the National Skills Fund are underway, under the coordination of the Department • Strategic Plans and SSP support to all SETAs by DHET and National Treasury • Established Task Team to assist SETAs in: • Alignment with integrated skills planning initiatives • Research Capacity • Improved Data Collection and Analysis • Partnerships and Integrated Planning

23. Infrastructure Projects

24. Infrastructure Projects • Infrastructure for FET college multipurpose campuses, student accommodation and ICT connectivity • Construction of new universities in Mpumalanga and Northern Cape • Refurbishment of student housing in historically disadvantaged universities • Building of new student residences • Inadequate technical skills due to low outputs from universities, improper gate-keeping by professional associations, lack of opportunities for work experience could impact on PICC’s Strategic Integrated Projects • Develop Skills Plans for 17 National SIPs and all major Government infrastructure projects as well as technical skills required for execution, operations and maintenance

25. Engineers, Technologists and Technicians • Engineers, technicians, technologists and artisans  • form the backbone of skilled workers for the economy • No use developing high level engineers and technologists if there is no production of intermediate level technicians and artisans to support them through Vocational Education and Training opportunities • There is a high and urgent demand for artisans and technicians that can be sourced outside of universities • There is a need for competent young individuals to take over from an aging cohort • Number of graduates registering as candidates and ultimately becoming professionally registered is low by comparison with those graduating

26. Engineers, Technicians and Technologists • Registration or the capping in the registration of professional Engineers hampering supply of engineers • Engineering graduates are not provided with the opportunity within a company or in industry to complete the three year required work experience to enable registration • Work opportunities are often provided but not relevant for registration • DHET is engaging with the Engineering Council of South Africa (ECSA) in a process where an agreement with industry is reached to provide a compulsory and a structured workplace exposure of three years to engineering graduates after graduation

27. Engineers, Technicians and Technologists • Shortage of Engineering academics • Professional registered Engineers are expensive or not available • Universities have been recruiting foreign engineers as lecturers with contractual obligations • One of the challenges identified is the provision of work permits and/or citizenship • Agreement with Home Affairs to expedite applications

28. Green Paper

29. Green Paper • The Green Paper seeks to out the challenges facing the post school system and sets out broad policy for: • Expanding post school provision to improve access • Strengthening the institutions to improve quality • Setting out a vision and pathways for achieving a coherent post school system with articulation, collaboration, and coordination between the different components, as well as alignment between the various institutional types and between education and training institutions and the labour market • Green Paper has been launched and released for public comment. Following public consultation, the work on the White Paper will commence

30. Thank You