Should Youth Unemployment be Targeted as Part of a Comprehensive Welfare Policy in South Africa?

A scheme to address youth unemployment is not an appropriate component of a social welfare net in South Africa because a higher proportion of older unemployed people are poor. Age is a very blunt proxy for inexperience (and associated labour market disadvantage) in South Africa. Placement programmes may help individuals find work, but to the overall welfare impact is undermined by substitution effects. Training programmes should not be seen as an answer to the unemployment problem (although it may help address some labour market problems). Training programmes for the unemployed are often weakly connected with the skill requirements of employers and can easily lead to an over-supply of specific skills. Given the difficulties involved in targeting the relatively disadvantaged amongst the unemployed, one has to ask whether resources are better spent elsewhere – e.g. on a basic income grant.