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 SMEs in education sector vital to bolster skills in South Africa


 The skills deficit which currently faces South Africa has a detrimental effect in the economy and is one of the contributing factors for the country’s high unemployment rate. This is according to David Morobe, regional general manager at Business Partners Limited (BUSINESS/PARTNERS), who says that the recently released Critical Skills Survey Results for 2017 by Xpatweb - which reported that 77% of local organisations struggle to recruit critically skilled individuals – highlights this struggle.

Morobe adds that the skills deficit is directly linked to the current faltering standard of the country’s education system, which lags behind most others globally. “South Africa’s higher education and training, and health and primary education, are ranked 85th and 121st respectively out of 138 countries on the World Economic Forum’s 2017-18 Global Competitiveness Index. This presents an opportunity to private education sector which has been growing steadily over the years. It is now more important than ever for SMEs that operate within in the private education sector to succeed if South Africa is to increase its skills base.”

The burgeoning SME-owned private institutions range from those offering business-related courses through to technical colleges. It is important, however, for new entrants to register with the relevant authorities to ensure compliance. “This, amongst others, helps protect the public against unscrupulous and exploitative operators, ensure that the qualifications obtained are aligned with the National Qualifications Framework, and that the education provided meets the goals of transforming South Africa in accordance with government policy and legislation.

Morobe points out that these SMEs are faced with countless hurdles and red tape when it comes to the funding of their businesses, and as a result he witnesses an increased need for assistance and support each year. “In an effort to ensure that these SMEs operating in the sector are able to access capital, Business Partners Limited (BUSINESS/PARTNERS) launched its Education SME Fund in 2014 - a R150 million fund aimed at providing existing and aspiring entrepreneurs in the educational sector with finance and support to meet the growing need to improve and expand the sector. Just in 2017, BUSINESS/PARTNERS approved 19 deals through this fund to the value of R 61 650 000.” 

Eric Mthokozisi Khoza, owner of the Maritime Education & Business Academy - an academy that focuses on maritime related skills development – received funding from the Business Partners Limited Education SME Fund in 2017. He says that many small businesses in the education sector are faced with the challenge of obtaining funding to offer training, especially for unemployed students which make up a large segment of the market. “The funding received from BUSINESS/PARTNERS played a pivotal role in the establishment of our business.”

Khoza explains that maritime education is still developing in South Africa and isn’t as organised as in other countries, such as Finland.  “Most local establishments that offer maritime related training belong to companies within the maritime industry - established to train their own employees – and are therefore not open to the public. This creates a barrier-to-entry for an unemployed individual who wishes to upskill him or herself.”

According to Morobe, educational institutions in other sectors of business also face the same challenges. “The key to creating more skilled professionals in South Africa clearly lies in making training available to wider groups of individuals.”

Morobe applauds all SMEs in the education sector. “Education has a great cross-cutting impact on the economic welfare of a country. It is therefore vital to support those that choose to operate in this space in South Africa as they are committed to making a real impact in the country’s economy,” he concludes.

For more information on the Business Partners Education SME Fund, please visit our fund information pageor our products page.




Enabling job creation for 35 years job creation for 35 years
Enabling job creation for 35 years job creation for 35 years

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