THE UNDRINKABLE FOUNTAIN:
SA’S YOUNG,
UNEMPLOYABLE
HUMAN CAPITAL
‘Demographic dividend’ was the trending buzz phrase at a spring breakfast
seminar hosted by the Institute for Futures Research (IFR) in September.
DEMOGRAPHIC DIVIDEND REFERS TO THE
ADVANTAGE or economic benefit a country
potentially has with respect to the size of
its young, economically active, working-
age population in relation to the size of
its ageing population. The point is that
the latter will lose its ability to be actively
economically productive, and that there
needs to be an able-bodied workforce to
replace it, with the skills and intellectual
prowess to do the job. A balance between
the sizes of the two population groups is
critical to the productivity and economic
success of a country.
Birth rates are key
Developed countries have an ageing
population, with fertility rates having
decreased significantly in the past 50 years.
If we consider that currently the birth rate
in South Africa is 2.5 births per woman, in
the EU it is 1.6. The highest birth rates are
found in France with 2.0 and Ireland with
1.9, while Germany has the lowest birth rate
in Europe with 1.5. In the US and Japan,
the average births per woman are 1.8 and
1.5 respectively 1 . This bleak fertility picture
would explain the incentives by some of
these governments (extended maternity
leave with full benefits is just one example)
to increase the fertility rate. The leaders of
these nations understand the impact that an
old, economically unproductive population
will have in the too-near future. These are
examples of low demographic dividend.
SA has the edge
IFR director Dr Morné Mostert says South
Africa is in the pound seats with respect to
its demographic dividend. But of course,
the challenges that exist are twofold: while
we have the age advantage, we have neither
the national job creation nor the education
and skills development strategies in place –
and running – to capitalise on this dividend.
At the moment we have a young population