Youth employment for municipalities

Wednesday, 17 February 2010 15:05

The Minister of Finance, Pravin Gordhan, announced in his Budget speech that municipalities would soon be eligible for a special subsidy for employing youth.

‘A component of our employment strategy is to promote job creation for our youth,’ he said, adding that labour market data confirm that employers were reluctant to hire inexperienced work-seekers, while school-leavers lacked basic workplace competencies. 

Under the leadership of the Department of Labour, initiatives were in progress to improve information services to help young people access jobs and training opportunities. ‘We propose to support these reforms through a subsidy to employers that will lower the cost of hiring young people without work experience. Under consideration is a cash reimbursement to employers for a two-year period, operating through the SARS payroll tax platform, and subject to minimum labour standards.’ 

Municipalities, non-governmental organisations and tax-compliant businesses would be able to take advantage of the scheme. He said the aim was to raise employment of young school-leavers by a further 500 000 by 2013. 

‘Our intention is that young people should benefit from this initiative by early next year. A discussion document setting out further details of the youth wage subsidy proposals will be tabled by the end of March,’ he said.