Sage South Africa Newsroom

Why learnerships make good business sense for small businesses

29 January 2018

By Viresh Harduth, Vice President: New Customer Acquisition (Start up and Small Business) at Sage Africa & Middle East

Cast your mind back to the time when you were starting out as a small business owner. There was probably a lot you didn’t know and would have been grateful for mentors who could share their knowledge and learnings.

This is the reality that thousands of matriculants now face as they leave school and enter the working world – it’s new territory and there’s a lot they don’t know.

Last year, only 150,000 of the 800,000 learners who sat for the final matric exams passed with university exemption. The options for the remaining 650,000 were to either study further through other channels – like technikons or online courses – or to find a job.

But with little experience and no formal qualification, well, you know what that feels like.

No experience, no job

It’s a bit of a chicken-and-egg situation: businesses want to hire young people with experience but few are willing to provide that experience, for reasons including cost, time and the perception that young people are unmotivated, difficult to manage and lack loyalty.

Yet, as the backbone of the South African economy, Small & Medium Businesses can be the mentors and training grounds that these young people so desperately need – and what they lack in experience, they make up for in enthusiasm, fresh thinking and a deep desire to learn, which can benefit any business.

Here are a few other good reasons why your small business should consider offering an internship or learnership programme:

  • Build skills while you build your business. Yes, there’s a chance that the graduates might leave after they’ve been upskilled but if you don’t provide opportunities for development, they’ll look for it elsewhere. Through learnerships, you’re also directly contributing to the skills pool of the country, which has a direct effect on job creation and economic growth.
  • Tax benefits. Businesses can claim tax rebates when a learner enters a training programme and when they complete it. If the learnership covers scarce skills, you could also qualify for a grant from a Sector Education and Training Authority (SETA). Plus, if you hire the learner permanently, you can claim employment tax.
  • Bump up your B-BBEE rating. If your learnership programme meets certain criteria, it can earn you points towards your Broad-Based Black Economic Empowerment scorecard – and a higher rating means better business opportunities, especially from the public sector (not to mention the reputational boost).
  • Save on hiring costs. It’s cheaper to train and retain existing team members than it is to hire new ones. Learnerships and internships not only provide an opportunity to identify and develop talent; they also boost your team’s confidence and increase job satisfaction and loyalty.

learnerships

The Small & Medium Business sector plays a crucial role in the South African economy. Research found that these businesses contributed 35%-45% to GDP and 50%-60% to the labour force. Imagine the difference we could make – especially at grassroots level – if every business offered a learnership or internship opportunity to one matriculant.

Young people bring a new energy and optimism to any business, adding diversity, different perspectives, 21st Century skills, and new values and experiences to the workplace.

Businesses often lament the fact that the education system does not produce work-ready graduates yet they are the solution to that challenge. And with 58% of unemployed South Africans being between the ages of 15 and 34, we can all play a small part, to collectively make a massive difference.