Monday, 24 May 2021

Open Letter / Minister of Trade, Industry & Competition Making the most of SA’s top BPO ranking

Written by

Dear Minister Patel,

South Africa’s top ranking in the 2021 Front Office Business Processing Outsourcing (BPO) Omnibus Survey was a jab in the arm during a time when Covid-19 upended our economic and social systems. State playbooks often prioritise traditional industries like mining and agriculture for development, but enabling a supportive environment for the growth of alternative industries can rapidly provide sustainable jobs to the millions of unemployed.

Youth unemployment is perhaps one of the most pressing issues facing the country. In light of the numerous initiatives of your department and those of your colleagues it is clear that the gravity of the situation is not lost on you. This letter is an honest effort to meaningfully engage over job-creation policies and how we can better leverage our rapidly evolving context to create more opportunities.

Youth unemployment has been much too high for many years and the pandemic is only likely to worsen it. With the 10-year average youth unemployment figure consistently above 50%, and the current limitations in our education system we must boldly face the realities facing our youth. One of the ways to do this is to leverage the positive momentum presented by the BPO ranking and focus on shifting our position of preference to one of dominance, accelerating the journey to 500k new jobs as articulated by President Cyril Ramaphosa.

Having conducted research on other markets that have successfully leveraged BPO to drive aggressive economic growth, and framed the strengths of our unemployed youth we have developed an approach that we hope may prove useful in shaping some provocative thinking.

If marketed well, our latent strengths can attract companies to take full advantage of the realities of globalisation by exporting certain business processes to South Africa where we can do the work faster, better and more cost effectively. The BPO sector is on the up and SA has a lot to offer in terms of reliability and security amongst other advantages that include,

Better value: A large pool of low-cost graduates that can quickly address problems, requiring minimal interventions from senior management which makes them a more efficient solution to front office BPO needs. Multiple initiatives aimed at upskilling this labour market with digital-first skills can help them learn to quickly address problems.

Young, vibrant demographic: A young population adept at English with an understandable accent and a bias to empathy makes South Africans ideal for front office BPO.

Access to talent: The greatest need for jobs and economic growth currently sits in rural and peri-urban areas, a situation that will only worsen if large employers like miners in these areas retrench. Creating work where needed will address challenges of migration while increasing job creation through adjacent industries necessary to support these new jobs in BPO.

Private participants: Partnerships with organisations like YES4Youth which is a key supplier of trained talent for low-skill jobs provide opportunities to scale up the work they are already doing. Using transformation points and tax rebates, outsourcing can be made more attractive to local corporates.

BPO’s track record: The sector itself has proven its ability to improve the quality of life of people employed. If the potential is acted on in earnest and with partners like YES4YOUTH, milestones like 500k jobs can be reached faster than the envisaged timeline of a decade.

Our youth, like the rest of society, are facing monumental challenges from the Covid-19 pandemic. As they chart their future, employment disruptions or persistent unemployment will only have a compounding negative impact. Our 16th annual Generation Next survey which polls over 6000 young people across the country reveals that while 75% of teenagers are optimistic about the future, that number drops to 56% amongst young adults. Programs like YES4YOUTH provide a critical connection to hope for the future.

Putting the youth in decent jobs is in equal parts a responsibility of all players in the private and public sector. We seize this opportunity to convey to you our willingness to work closely with your office to further advance our work in tackling common challenges for the youth in South Africa.

Thuma Mina,

Refilwe Maluleke,
Managing Director at Yellowwood