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SIMON BROWN: I’m chatting now with Osagyefo Mazwai, Investec Wealth and Investment International strategist. Osagyefo, appreciate the early morning time. A fascinating piece you put out recently. You’re talking about our lack of growth over the last decade and a half. Our economic growth is, it’s been sub 1% for that decade and a half. You make the point that if we’d grown (at the rate of) our emerging market peers of, plus 4%, which we had clearly done back at the turn of the century, we would have had a vastly better job situation.
We have lost literally millions and millions of job opportunities because of this low growth, and it is fundamentally hurting our economy.
OSAGYEFO MAZWAI: Thank you, Simon, and good morning to all your listeners. Yes, we ran the numbers, and we’ve been having quite a conversation around what this lack of growth in South Africa has meant for a variety of factors. One of them that we recently looked at was what that meant for the labour market.
If we run the numbers, there are various assumptions that go into it, but if you run the numbers and it gets to likely an unemployment rate of between 15% and 20%, then that tells us that we would have likely had between 3.2 million and four million additional jobs in the economy.
At this point in time, the vast majority of the unemployed is the youth. I think that is the critical issue that we are discussing, is that had we grown and had an environment where we were creating jobs, then the youth unemployment rate would likely be significantly lower. In fact, the youth would have been the primary beneficiary, given that they take up the vast majority of the unemployed population.
SIMON BROWN: Yeah, and four million lost jobs, the difference we would have in the economy if we had those jobs. It is the youth, and that is the tragedy of it, is the lack of youth (employment). Then that will oftentimes permeate through their working career.
Added to it is also the role that education plays in it. You make the point that 25 years ago, we were standing on a brave new world. If anything, in the year 2026, it’s got even wilder, changing faster, and the education of the youth is massively important to them being prepared for these jobs as they come through.
OSAGYEFO MAZWAI: Yes, that’s absolutely correct. As you correctly mentioned, 25 years ago, we faced a similar kind of juncture in the road. At that time, people would have been concerned about what the rise of the internet would mean for job security and the future of work. The critical thing now is that we are seeing rapid changes coming through from an AI development perspective and again, those questions are rising about what does the future of work mean?
There are concerns around significant labour market disruptions, and to mitigate against that risk, it is important that the youth is prepared for whatever the future of work looks like and have these skills ready for that future economy.
SIMON BROWN: That’s a great point because that is the challenge. I am a long way out of school, and when I was in school and I was choosing my subjects for matric, it was important, but my sense is if you got it wrong, it wasn’t the end of the world.
I suspect these days in 2026, that decision is a lot more critical and a lot more stressful for not just the kids, but the parents at the same time, and frankly, probably the schools as well, because it’s hard to know exactly what are going to be the skill sets going forward.
OSAGYEFO MAZWAI: Yes, I suppose if we look at 100 years ago and you look now, the situation is probably vastly different when you look at what kind of employment opportunities existed then and what employment opportunities exist now. As you say, it’s inherently difficult to forecast what the future looks like.
But it is important that the areas that have typically been successful in building or creating resilience or a skill set that is relevant for the future are Stem-related (Science, Technology, Engineering and Mathematic) fields. Of course, arts and sciences-related fields will always be important as well, but it is important that we do have that skills capacity coming through so that we can be insulated from any kind of disruptions and be future ready.
SIMON BROWN: Yeah, and 100 years ago, I’m not quite yet that old, but I take your point. Last one, you talk around the distinction between private and the government schools, and the sense around careers support, and that the government schools are probably fundamentally failing the students at the same time, in terms of that support in that process.
OSAGYEFO MAZWAI: Yes, and we’ve made this point before, that from a public education perspective, we do need to see that improved in terms of education outcomes. There is that disparity between the lived reality of public and private education in South Africa.
It’s all about resource constraints. From a public school perspective, the resource constraints do mean that there is a challenge around how do we develop, how do you provide career guidance, whereas from a private school perspective, there is that opportunity to provide that guidance. That is one of the issues that exacerbate the problem, particularly for those coming from less fortunate or disadvantaged households.
SIMON BROWN: Absolutely, and then a last question. We’re expecting better GDP growth for 2026. To be clear, better is relative to what we’ve been doing. The future is looking a little bit brighter. We are in a sense, I suppose, if we can get that 2% and maybe down the line 3%, even perhaps higher GDP, we start to unwind this.
But your point is that some of this is almost structural. You talk around disadvantaged; you talk around resourcing. Some of it is still going to be structural and is way more than just that GDP growth.
OSAGYEFO MAZWAI: Yes, it is structural. The unfortunate part is that there is a generation that has experienced this low GDP growth that is structurally at 1%, and that is now the reality. The youth will have to be active in trying to find a solution to the problem. But now for the future guys, for the guys coming in, it is important to recognise that if we are entering a higher growth environment, then it does mean that government will likely collect more in tax revenues.
Hopefully those tax revenues are steered towards these growth-enhancing areas of the economy, of which education is critical. Hopefully through that, and the Minister of Basic Education (Siviwe Gwarube) has said as much, that early childhood development is critically important.
The foundational aspect is critically important. You lose young people to the system at a very young age, and you need to keep them in the system. We need to also ensure that they come through the system and be empowered in the relevant field so that they are able to be economically active in the future.
SIMON BROWN: Yeah, that’s a great point. This starts very, very young. It’s not something which happens in your last year of school and the like. We’ll leave it there. Osagyefo Mazwai, Investec Wealth and Investments international strategist, appreciate the early morning.
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