International Finance Corporation (IFC), a member of the World Bank Group, is introducing an employment advisory services program aimed at helping universities and vocational training institutions improve career outcomes for students and better align their programmes with labour market demand.
The company says in many emerging markets, unemployment rates for tertiary education graduates can be as high as 30%, a result of mismatches in skills offered by education institutions and job market needs.
By using the employability tool, institutions will be able to assess their employability services, analyse indicators such as graduation and placement rates and the quality of linkages with employers, and graduates' readiness to transition to the job market.
This initiative will be an important addition to IFC's suite of knowledge and advisory services beyond its traditional financial investment instruments, notes the company. It will help tertiary education institutions provide relevant, quality and affordable education with robust links to employment, it adds.
IFC will roll out the program in South Africa starting this month, working with private and public universities.
In November 2016, South Africa's unemployment rate reached a 12-year high of 27.1%, says MMG Holdings. While this figure has since dropped to 26.5% in 2017 (92 000 people have found employment), SA unemployment still ranks as one of the highest in the world; driven mainly by its skills crisis, it adds.
South Africa has a skills problem and an unemployment problem, says Ryan Falkenberg, CLEVVA co-CEO. Many companies find it difficult to source the skills they need to grow their services, while simultaneously the millions of unemployed battle to find jobs in an economy that has developed beyond what they can provide, he adds.
There is a disconnect - not just in South Africa but in many countries - between what employers are looking for in terms of skills from graduates and what students are learning in universities, says Elizabeth Price, communications lead for IFC Manufacturing, Agribusiness and Services. This tool helps educational institutions bridge that gap more effectively, she adds.
"We are starting in SA and then will work across the world where we have interested clients: the benefit of this is sharing best practices across IFC's global client base in emerging markets. In terms of focus countries, Ghana is likely to be next."
IFC says it has successfully piloted the tool in Asia, Africa, the Middle East, Latin America, and the Caribbean.
"We've chosen South Africa as the first country in Africa because youth unemployment and underemployment is unusually high, a matter that is also very high on Government's agenda, says IFC country manager Saleem Karimjee.
"Colleges and universities recognise the need become more pro-active in working with employers to understand their needs, and we believe that IFCs Employability Assessment process will create a valuable foundation for those discussions."
IFC has financed over $1.8 billion to over 120 projects to support private education in emerging markets.
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