The hidden costs of B-BBEE Skills Development

The hidden costs that are essential for high quality Skills Development that delivers

When Skills Development is viewed as a number on a balance sheet, it can account for a significant percentage of a company’s income. This cost however is relative and should not be judged in isolation; Skills Development should rather be evaluated against the massive benefits it derives for the company, individuals and the South African economy.

Rajan Naidoo, the Managing Director of EduPower Skills Academy says that corporates should view Skills Development as an investment in people, with the positive results for organisations being exponentially greater than the cost.

“Skills Development is a means to an end and not an end in itself,” Rajan explains. “On a micro learner level, employment, career advancement and ultimately economic freedom is the goal. On a macro level, training helps us to grow our national economic output, reduce social inequalities and build a strong middle income group.”

Rajan believes that for companies to realise these exponential benefits, Skills Development has to be done right. This means investing in training providers with the infrastructure and training capacity to yield the desired outcome: “In Skills Development, qualified and experienced trainers, mentors, coaches and top-notch facilities are what differentiates ordinary from extraordinary. High quality and exponential results may come with a relatively higher price tag but value is the determinant of the true cost.”

Rajan explains the costs in facilitating high quality Skills Development and how these result in value for employed and unemployed learners, the sponsor and the economy:

1. Extensive Programmes

For many corporates, learnerships make up the majority of the points earned for Skills Development. These are generally 12-month training programmes that comprise 30% theory and 70% practical work experience and include cost components such as recruitment, training and remuneration. Paying a decent stipend to learners ensures reasonable nutrition, transport, attire and research; which ultimately help the learner successfully complete the qualification.

2. Meaningful Work Experience

Real-world quality work experience is essential in the development of the learner as this imparts the skills needed for the world of work. To implement work experience that really shifts the learners requires extensive resources, infrastructure and management time. The ratio of staff to learners is often high to counteract the slow increase in productivity, learner behaviour and conduct, lack of knowledge and even apathy. Quality work experience therefore necessitates the use of experienced mentors and coaches and they are invaluable in building holistic graduates who are ready to transition from unemployed to employed.

3. Future proofing skills

Facilitating access to the internet, downloading and printing is an invaluable component for any student in the modern model. Work experience with current end user software and reliable, efficient hardware is the cornerstone for work preparedness and this requires training providers and employers to invest accordingly.

4. Reasonable accommodation for People with Disabilities

Corporates frequently opt for learnerships for People with Disabilities (PWD’s). These are usually outsourced to specialist training providers as the sponsors don’t have the capacity to develop these learners in-house. But it’s not only a case of having the right facilities. Most PWD learners also require specialised training and service providers close academic and social gaps by providing additional training, coaching and mentoring – which all make up the reasonable accommodation component in PWD learnerships. By offering these services, PWD learners receive the support they need to be fully integrated into the workforce.

5. Post learnership employment

There is also an added service where training companies provide or help their unemployed graduates find permanent employment. For some providers, there is the incentive to offer permanent employment after the learnership, which requires an increased payroll. The knowledge and experience gained by a young unemployed learner is however huge as the learnership can increase their productivity threefold and the growth in their value to the business and economy is massive.

Rajan concludes: “Corporates using price as the sole determinant of their Skills Development are likely also getting low quality results. But for those companies that prioritise high quality training and development, Skills Development delivers exponential results which reflects the true intent of the B-BBEE Codes.”

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