There are CEOs who just want the title, and there are CEOs who get the title because they get things done. At Apple, for instance, what made the difference was that one individual’s vision to change the world prevailed over another’s desire just to be the CEO.
Too many “leaders” stay beyond their sell-by dates, or even their welcome, because that’s their end-game. Growth is retarded and eventually value is destroyed. Where titles are more valued than achievements, failure is inevitable. This happens at the highest levels of government, here and all over the world. “Get in, stay in”, is the politician’s mantra. In which case more of the same is more likely than necessary change, regardless of the consequences.
No floundering business or government will be fixed by creating more positions or handing out more titles, and no unemployment crisis will be overcome by simply increasing the number of graduates. Degrees don’t make money or create jobs — people do. Simply increasing the number of bachelor’s degree certificates on the payroll (regardless of whether they deliver the required capacity) won’t solve anything — it’ll just cost more and create animosity among the people who actually get the job done.
In SA we have become fixated on the importance of getting a degree. We’re making it ever easier to get into university while trying to convince people that a degree — any degree, however abundant — is a valuable ticket to personal influence and prosperity. We may just have gone too far.
As the minimum requirements to get into university are lowered (compounded by lower school standards) we will simply produce more graduates who can’t produce the goods and are unlikely to get a job. If we eventually just give them all jobs (only because they have degrees), the quality of output we can expect will also decline, to the point where businesses that do that will be unable to compete with businesses that don’t. Our companies will be unable to attract capital for growth and their eventual demise will put more people back on the streets, adding to the unemployed.
This spiral of failure is obvious, but so are elements of its solution. It is folly to think that you can overrule the fundamental forces of supply and demand by decree or intervention. It’ll backfire on you.
The end users of skills sets (education’s customers) must be responsible for determining the demand and mix of graduates they’ll require in the next three to five years, and then be happy to pay for their education to secure their services. Think of it as an offtake agreement between the various sectors of the economy requiring the skills, and the tertiary institutions producing them. Expand or contract university capacity as demand and supply dictates.
That deals with the degrees for jobs supply-demand equation. The next section of jobs will require education from different tertiary education centres such as technical and sector specific colleges, to supply teachers, nurses, farmers, miners and construction workers. Apply the same formula for matching supply and demand, and the same funding model, and the same sustainable solution will emerge.
All sections of the potential workforce for industries can be dealt with similarly. If there’s still an excess of labour, which there will be, then we focus our industrial expansion efforts by investing in, say, labour-intensive industries where we have sufficient local advantages to compete globally.
All of this must then circle back to an education policy that delivers as an output the skills we need to grow our economy at a rate at least above our population growth. As unemployment gets solved in this system, more capital will be generated to fund even more growth, build more schools, colleges and universities and ultimately relieve the state of the overwhelming social support obligation it has to fund and the borrowings we have to incur to otherwise keep ourselves afloat.
• Barnes is an investment banker with more than 35 years’ experience in various capacities in the financial sector.
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