South Africa is sitting on a ticking time bomb — or a once-in-a-generation opportunity. With one of the world’s youngest populations among major emerging economies and the highest youth unemployment rates globally, the country must invest now in skills and higher education or risk a deepening crisis.
While systemic barriers remain, a new wave of public-private innovation — if matched by investment and policy reform — could turn crisis into opportunity and position South Africa as a continental leader in clean energy and the digital economy.
A Generation at a Tipping Point in South Africa
“We’re not just trying to build digital skills for the sake of it,” says Tshego Walker, a senior advisor in South Africa’s Presidency. “We’re building the foundation for youth to participate in the green economy, in AI, in areas that will define the global economy for decades.”
Youth unemployment in South Africa remains among the highest globally. Nearly one in two young people remains locked out of the labor market, according to Statistics South Africa. It’s a generation caught between deindustrialization and rapid technological change, as agriculture digitizes and mining shifts toward mechanization and cleaner energy.
“Without question, digital skills are central to answering: where are the jobs going to come from?” says David Makhura, former Premier of Gauteng (South Africa’s economic hub) and now Head of Political Education for the ANC.
Digital Growth and Clean Energy Offers South Africa a Path Forward
Projections suggest the country’s digital economy could nearly double its GDP contribution by 2030, creating up to 1.2 million jobs in AI, cybersecurity, and cloud computing. As a case in point, Google recently announced that its new data center investment in Johannesburg could help create up to 300,000 jobs.
“When you have such high unemployment, it means that we can put those people to work, which is an opportunity that we don’t have in other regions,” said Google’s EMEA President, Tara Brady.
Makhura also sees energy as another sector with significant employment potential. His view echoes recent remarks by Bill Gates, who noted that while AI will make many roles obsolete, energy professionals—alongside coders—will remain essential.
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“AI can optimize [energy] systems, but human expertise is still required for crisis response and long-term planning,” Gates explained.
Research by FSD Africa estimates the continent’s green economy could generate 3.3 million jobs by 2030, with South Africa capturing between 85,000 and 275,000 of those, ranging from solar technicians to battery engineers. The solar sector alone could create up to 140,000 jobs.
Companies such as Genesis Energy and retail investment platforms like Energea are already moving capital into the country’s renewables sector—even as investment slows in more mature markets like the U.S. Genesis projects its solar investments alone could generate 1,700 jobs within two years. With the right policies and support, that figure could grow substantially. As climate finance increasingly, albeit inconsistently, flows to emerging markets—particularly through development finance institutions like the World Bank—countries that can demonstrate a ready green and digital workforce will be best positioned to attract investment.
To its credit, the South African government has also introduced several incentives to attract investment and generate jobs. One standout initiative is the Youth Employment Service (YES), which offers tax incentives to companies that place young people in one-year work experiences—often in fast-growing sectors like tech, energy, and logistics. To date, YES has reportedly created over 130,000 work opportunities.
Skills Development in South Africa: The Highest Return on Investment
So, where is the greatest return on investment? All signs point to skills development. The World Economic Forum’s Future of Jobs Report 2025 notes that 60% of companies globally cite a lack of skills as a barrier to transformation, and South Africa is no exception.
“One of the biggest shifts we’ve seen is the rise in demand for green and digital roles,” Walker told me. “But this requires rethinking education, not just expanding access. We’re embedding work readiness into how we approach skills from the start.”
Microsoft South Africa recently announced a partnership to train 1 million people in AI and cybersecurity skills by 2026. Nonprofits like Digital Skills Africa, in collaboration with Amazon Web Services and Cisco, are offering hands-on training and mentorship for in-demand tech careers.
Jezeiyn Naidoo, Digital Skills Africa’s head of partnership and operations, says its work focuses “in rural and peri-urban areas, where many young people, some as old as 25, have never fully engaged with the digital world. Some don’t even know what an email address is or how to navigate the internet,” he says, underscoring the depth of the digital divide.
To change that, the program connects students directly with professionals in fields like cybersecurity, data science, and cloud computing—people who can demystify these industries and make them relatable. “It’s one thing to read about a broad range of careers, but it’s something entirely different to have a conversation with someone who has walked that journey,” Jezeiyn explains. This personal connection, paired with access to globally recognized certifications, is what makes the program impactful. “We want a student in a South African township to have access to the same career certifications as a student in a first-world country.”
For participants, these programs can be transformational. Tare Katayi, now himself an instructor at Digital Skills Africa, transitioned from construction and plumbing to cybersecurity and cloud computing.
“When I met Digital Skills Africa, I was living in a shack. Now, I have a stable job and a career I never thought possible,” he reflects.
Clayton Naidoo, a Google executive and one of the founding supporters of Digital Skills Africa, described Tare’s story as a defining moment. “It made me ask: what was it about Tare’s background and environment that enabled him to thrive?” he said. “Our goal is to understand those conditions — and scale them. Instead of chasing output numbers, the real question is: are we giving people skills that lead to real jobs?”
Walker agrees: “We’re seeing a lot of great pilots. The next step is figuring out how to align these efforts and take them to scale.”
Naidoo adds: “When we started Digital Skills Africa, I had no idea it would grow the way it has. But as soon as we began asking that core question — what actually leads to opportunity? — people from all sectors leaned in to help us figure it out.”
The energy sector is also seeing promising skilling initiatives. Genesis Energy runs Genesis Academy, which offers training in solar installation, battery maintenance, and energy efficiency auditing in the communities where they operate.
Companies like Trans Energy Global are leveraging carbon credit trading to attract global investment, fast-track clean energy adoption, and support renewable energy training programs. With clear policies in place, these models could scale rapidly, offering an alternative to public funding to drive clean energy deployment and job creation.
Reforming South Africa’s Higher Education Sector to Keep Up
Still, public-private skilling programs alone aren’t enough. Higher education reforms are urgently needed to ensure young people are job-ready for fast-evolving industries. Universities must collaborate more closely with industry, accelerate curriculum updates, and embed hands-on training.
“Our higher education institutions are undergoing their own digital disruption,” says Makhura. “By the time they introduce new measures, technology has already moved forward. We can’t rely solely on traditional education models.”
Naidoo underscores this, adding: “Most countries across Africa still lack comprehensive AI and cloud policy frameworks — especially when it comes to inclusion. Right now, we don’t even have a Minister or Commissioner for AI who truly understands what this technology means for government, including in areas like education and workforce development.”
Fortunately, innovative learning models already exist that South African universities could pilot, adopt, and scale. These emphasize critical 21st-century skills—problem-solving, creativity, critical thinking, collaboration, communication, ethics, and accountability—and focus on high-growth technologies. Many also feature AI-powered e-learning systems that are adaptive and regularly updated to keep pace with industry demands.
If deployed at scale by higher education institutions, these models could help students access world-class programs locally, allowing more talent to stay, learn, and contribute to South Africa’s long-term growth. But it will require investment, including in scholarships and bursaries to make such learning accessible.
South Africa’s Crossroads
South Africa stands at a crossroads. With bold policies and targeted investment, it can transform its youth crisis into a growth engine—fueling innovation, attracting capital, and taking the lead in clean energy and digital transformation.
“If we don’t optimize initiatives around digital skills, digital infrastructure, and financing for startups,” Makhura warns, “South Africa will continue missing the greatest opportunity to tackle youth unemployment.”
