Though there are far too many complex variables to allow for generalisations, I’m going to make one anyway. We’re going to live longer than we used to. If you’re 65 now and reading this newspaper, you’ve got a more than 50% chance of living beyond 80. This has huge implications for the economics of life after work, particularly if you don’t want to be a burden on the state or your children.
Even if you don’t mind being such a burden, the prospects of getting a social grant you can live off or being looked after by your offspring are pretty bleak. This is so as far as the financial state of the state is concerned and the fact that there are hardly any jobs for your kids to support themselves, let alone look after grumpy, old, expensively medicated you. At 74% we have the highest youth unemployment rate in the world — don’t even think of moving in with them, they’ve probably only just moved out of your house.
If you’re going to live for 20 years past your last payday you’d better have something like 20 times your final annual package stashed away in an inflation-proof investment. Little wonder, then, that older people are trying to cling onto their jobs for longer, particularly in politics (worldwide) it seems. Beyond the longevity economic debate this has a stifling effect on the collective mindsets of corporations and governments and ill-equips them to compete in a modern, competitive, universally and instantly informed global society.
I’ve long supported the model of management that says the wise, experienced captain should stay in the cockpit but the younger lieutenant should fly the plane. Numerous examples in the corporate world show this to be effective. But even clearing out those stuffy corner offices and filling them with open plan energy isn’t going to be enough to solve the problem. Four generations living under the same roof isn’t the answer either.
Fundamental, structural change of the economic construct will be required. The age of corporate monoliths is over. The age of job security is over. Lifetime employment is over. Careers as we know them are over. Hierarchy is over.
The role of business elders must move away from being nonexecutives on bloated boards (thank you notes for loyalty and good service) towards being responsible for creating jobs through funding and mentoring start-ups run by upstarts.
The economy must explode into smaller, agile, relevant, demand-driven, responsive, self-sufficient, growing fragments — led by entrepreneurs. Satellite, singularly focused business units must pop out (like maize kernels puffing up from the heat) from under the corporate umbrella and go get a life. Grab a few clever, energetic, stubbornly determined mates. Find an older, experienced business-person to help you raise capital and make sure you behave and make fewer mistakes than they did, and off you go.
The state has a huge role to play in this. Take the red tape out of the way. Simplify the tax system and allow for early assistance and later payback. Think local economic zones. Provide (some) funding (or at least have lenient failure rules) to enable and embrace small business. To fulfil this vital role, state corporate finance capability has to operate at the highest level and have the confidence to move out of comfort zones. Appoint ministers of entrepreneurship, of employment, whatever.
We have to do all of this while still reserving a space (a big space) for businesses that have to be big enough to enjoy economies of scale and be the low-cost producers — essential to be able to compete globally. Competition law has to be reconsidered, with a broader market perspective.
We have to take considered risk. We have to let the numbers look after themselves, lest corruption becomes the single biggest employer of our children. Let’s rewrite the rule book. If we don’t, there will be little chance of any green shoots fighting their way through the sludge of reluctant change.
• Barnes, a former SA Post Office CEO, has had more than 30 years of experience in various capacities in the financial sector.
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