By Michelle Hassan

South Africa has seen a substantial rise in the gig economy, particularly in urban areas. In 2021, 3.9 million gig workers constituted 1% of the workforce, with a predominant demographic of individuals under 30 concentrated in major urban hubs like Cape Town and Johannesburg. The sector is currently experiencing an impressive 10% annual growth, primarily in the service sector—especially transport, personal services, and trades. A key enabler for the rapidly growing gig economy has been the increasing youth unemployment rate at 49.3% in 2021 for the median age of 27.5 years. Our report on South Africa’s Jobtech Landscape explores the dynamics of South Africa’s evolving job market, highlighting the opportunities presented by the expansion of the gig economy, the potential of jobtech, and the challenges unemployed youth face.

As the gig economy expands, jobtech emerges as a pivotal force, offering solutions to South Africa’s pressing youth unemployment challenges. With 34.3% of young people aged 15-24 categorized as neither in education, employment, nor training (NEET), jobtech holds the potential to provide meaningful opportunities for skill development and employment.

Enabling Factors for Jobtech

1. The jobtech landscape benefits from a foundation conducive to growth. With a median age of 27.5 years, coupled with 38% of the population owning smartphones and widespread access to banking, it creates an environment ripe for technology integration. However, the country ranks 84th out of 134 nations on the Global Digital Skills Index, emphasizing the need for continued investment in digital literacy.

2. South Africa’s youth face significant hurdles in securing employment—limited information, low access to education, high geographical and cost constraints, and challenges in accumulating work experience and social capital. However, jobtech can effectively tackle these barriers.

3. Many jobtech platforms integrate e-learning, bridging the information gap and empowering young job seekers with essential skills. Jobtech also provides accessible avenues for post-secondary education and training, overcoming traditional constraints.

4. Spatial challenges stemming from apartheid-era planning, which led to high transportation costs, are mitigated by jobtech-enabled remote work opportunities. This not only reduces costs for job seekers but also fosters more inclusive employment practices.

5. Jobtech’s low entry barriers enable young people to build work experience, addressing the delayed entry into the workforce. By providing platforms for skill development and employment opportunities, jobtech becomes a catalyst for empowering South Africa’s youth, fostering economic participation and sustainable growth.

South Africa is on the brink of a transformative shift in its employment landscape. The momentum of the gig economy and the potential of jobtech offer tangible solutions to address pressing unemployment challenges, especially among the youth. As the country embraces these changes, continued investment in digital literacy, supportive policies, and adaptive strategies will be vital to ensuring a fair, inclusive, and sustainable job market for all. Read the full report here.