Skills supply and demand in South Africa

This report provides a holistic understanding of the current supply and demand for skills in South Africa, and represents one of the first attempts to analyse how the two interact to inform future skills policy to support an inclusive economic growth path. The analytical approach used in this report represents a radical departure from manpower forecasting and attempts to understand the complexities and intricacies around how supply and demand interact, and the corresponding implications for reform.

Under this approach, using largely data for the 2010 to 2014 period from the StatsSA Labour Force Surveys and the Higher Education Management Information System, signals on current and intermediate demand for skilled, semi-skilled and low-skilled occupations are interpreted. The understanding of skills demand involved an exploration of the three inter-related aspects: the state of the economy; the characteristics of the employed and unemployed who make up the labour force; and current and intermediate demand from the analysis of changes in the structure
of employment. We juxtaposed the signals of demand against the supply of skills from out of the formal school education system, the post-secondary education and training systems and also the workplace. The interaction between supply and demand provides the basis for interpreting signals on the nature and extent of skills shortages and mismatches facing South Africa. Only through understanding the
complexities of how demand and supply interact is it possible to guide future investment and interventions, as well as support a move towards a more inclusive skills development path.

The South African labour force is made up of 15 million employed and 7.5 million unemployed people. Three quarters of the employed and 90% of the unemployed
are from the African population group. Youth unemployment is particularly high at
45% and increasing as more young people join the labour force.  11.75 million persons of the labour force have less than a grade 12 certificate.