As South Africa prepares to celebrate Youth Month in June against the backdrop of persistently high youth unemployment, questions are growing about whether corporate skills development spending is delivering meaningful economic returns – for employers or for young people entering the workforce.
The numbers make the problem serious. Statistics South Africa's Quarterly Labor Force Survey Youth unemployment among people aged 15-34 stands at 43.8% in the fourth quarter of 2025. At the same time, businesses across a variety of sectors continue to report acute shortages in digital and technical skills.
Both things are true together. This contradiction points to a systemic failure – not of funding, but of outcomes.
According to Riaz Moola, CEO of HyperionDev, the main problem is how the success of skills development has historically been measured.
“There is no shortage of skills funding conversations in South Africa. We have a problem of rising outcomes. For years, success in skills development has been measured by how many people entered a programme, not how many people subsequently achieved meaningful employment. Those are two very different things.”
There is increasing pressure on corporate South Africa to demonstrate the return on investment of training and skills development expenditure, particularly as businesses face slowing growth, productivity pressures and rapid technological change driven by artificial intelligence and automation.
Businesses are increasingly moving beyond the number of courses completed and instead focusing on indicators such as time-to-productivity, retention rates, project readiness and long-term employee performance.
“The conversation is moving from education compliance to business performance,” says Moola. “There is increasing scrutiny over whether training programs reduce onboarding time, improve retention, and build stronger internal talent pipelines. This is the right question to ask.”
The challenge is becoming more urgent as AI is reshaping traditional entry-level career paths.
Many entry-level tasks that once formed part of junior career paths are becoming increasingly automated, increasing what it means to be ready for the workplace. Employers are valuing not only technical ability, but also communication, collaboration, adaptability and the ability to work in a real project environment from day one.
Mula says employer expectations for junior digital talent have changed significantly over the past 18 months, with businesses placing an emphasis on technical competence as well as practical workplace preparation and problem-solving ability.
“Companies need talent who can contribute quickly in a hands-on environment,” says Moola. “Employers constantly tell us that technical knowledge alone is not enough. They need graduates who understand workflow, deadlines, teamwork and how to work in a real development environment – not just graduates who have completed a course.”
Research An analysis of almost 11 million UK job vacancies found that as demand for AI-related roles accelerated, university degree requirements for many AI vacancies fell by 15% – highlighting the wider shift towards skills-based recruitment.
recent uk workforce Research It also found that 38% of employers expect to hire fewer graduates due to AI-related workplace changes.
Mula says one of the biggest misconceptions in South Africa's skills conversation is that technical training alone guarantees employment. “Technical proficiency has increasingly become the only admissions requirement. What sets candidates apart is everything else: communication, adaptability, collaboration and problem-solving.”
“We have found that mentorship-driven and practical learning models often produce stronger employability outcomes because they more closely reflect real workplace environments and behavioral expectations,” he explains.
“South Africa’s youth unemployment challenge is not just about access to education,” says Mula. “It's about access to structured support, workplace context and the kind of confidence-building that comes from learning with experienced practitioners.”
The issue is expected to become increasingly prominent during Youth Month in June, when national attention turns to employment, education and economic inclusion.
Mula believes that at this time there is a need for a fundamental change in the way skill development success is defined.
“The real benchmark is whether training creates jobs, leads to career progression, increases productivity and provides sustainable opportunities,” he says. “If South Africa wants to build a truly competitive digital economy, we need to stop counting enrollments and start measuring economic mobility.”
