Economic Growth = Growing Entrepreneurship

by Judi Sandrock on 22/03/11 at 7:51 am
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If South Africa’s economy is to continue to see healthy growth, we need more people actively involved as employers, and not just employees. Creating employment is one, if not THE most important challenge for South Africa, and if we are going to tackle it effectively, a change in perspective is required on several fronts.

1.Unemployment

The first change in perspective is the term unemployment itself. To me, unemployment is not simply about people not working; it’s a shortfall of citizens creating work. As we look to sustain and spur economic growth, I believe government and industry should spend more resources to help create companies first and foremost (and I don’t mean more parastatals).

A key element of this is making the process as simple as possible to develop a business, particularly the registration process. The faster individuals can start a business, the greater the potential for jobs to be created at an accelerated pace.

An important part of helping start-ups start out, is established a support system for those with ambition, tenacity and skills to boldly start their own enterprise. This includes successful business people to act as mentors, family members providing emotional encouragement and a network of fellow entrepreneurs with whom ideas and setbacks can be discussed. It is within the best interest of all those involved in this support network to have a young business grow in order to create jobs and more effectively contribute to economic growth and community upliftment.

2. Established Businesses

Another perspective we must take on is the myth that established businesses create the majority of jobs. South Africa’s small and medium enterprises (SMEs) are the true engines of growth. The role of SMEs in driving economic growth is undisputed, but what’s essential is ensuring these businesses remain nimble enough to recognise opportunities and act upon them. Graduates from universities and even matric, must be encouraged and equipped to not simply get a job, but to create their own companies. I’d take a generation of employers over a generation of workers any day.

3. Our Nation

The other South African perspective that needs to be corrected relates to how we present ourselves as a nation. It was so heartening to see some of the entrepreneurs at the Branson Centre of Entrepreneurship who recently met and interacted with Richard Branson in Johannesburg. The highlight of the day was Lesego Malatsi, an entrepreneur and fashion designer, who is also risk-taker, creative genius and passionate employer. He now owns his own shop in Maponya mall and is taking one of his collections to show in LA later this year. Embodying a can-do attitude, he is an example of how South African entrepreneurs are looking beyond their own borders and convincing those who want to invest in the country that we have great potential to turn good ideas into great businesses.

4. Racial Transformation

The last perspective worthy of examination is the framework in place to encourage racial transformation across South Africa’s business sector. Clem Sunter recently wrote about establishing an Entrepreneurial Economic Empowerment Programme (EEE); something I wholeheartedly endorse. Under the proposed EEE programme, large companies would be measured on their contribution toward developing small businesses. Think BBBEE, but specifically focused on shared responsibility between large and small businesses.

South Africa’s entrepreneurs can be the lifeblood of our country’s economy, but in order for this to be a reality, several perspectives need to change. As much as I believe in job creation to improve the economy, in practice I’m most interested in transforming business prospects into profitable employers.

Judi joined the Branson Centre of Entrepreneurship in August 2010 as CEO. In this unique position she is responsible for identifying high potential entrepreneurs, equipping them with practical skills, providing them with access to coaches and mentors and financing opportunities to enable their businesses to grow. View more articles by Judi Sandrock.

Tags: BEE, branson, branson centre, business, Entrepreneurship in South Africa, small business, SME, South African Entrepreneur, Unemployment

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