Image Credit: Andela Media Kenya

South Africa recently hosted the Jobs Summit to discuss interventions to drive job creation and economic growth. Unemployment is on the rise with people being laid off from work and entrepreneurs doing freelance work in addition to their normal businesses so they can supplement their income and make ends meet.  With all this distress, graduates face great difficulty finding gainful employment. According to statistics, every second youth in South Africa is unemployed and only 10% of the population is responsible for most of the country’s economic activity. The rate of unemployment is 27.2% and the unemployment rate of young people alone is at 52.4%. This high rate of unemployment essentially has become a ticking time bomb in South Africa. Due to the enormity of this problem, citizens and influencers have tried battling the unemployment problem by drawing attention to it through various social media platforms with hashtags such as #JobseekersSA. There is also the popular tweet “O jewa ke eng”(What is bothering you?) and the response of hundreds to this is unemployment. As well, recently, some graduates went as far as going to the Union Buildings to hand over a memorandum enlisting their demands to the President, Cyril Ramaphosa.

The Reality of a Transitioning Labour Market: The Gig Economy and Automation. 

Gig Economy

In a gig economy, temporary, flexible jobs are commonplace and companies tend to hire independent contractors and freelancers instead of full-time employees. South Africa’s first taste of the impact of the gig and sharing economy was with Uber. Consumers viewed it as both an affordable and convenient means of transportation made available to the customer with just the tap of a button.  However, as Uber started taking off, there were protests and bouts of violence from the metre taxi industry with complaints that Uber needed to be regulated. This sparked a debate of whether its drivers were contractors or employees. 

In the UK, an employment tribunal ruled that Uber drivers were ‘workers’, and not self-employed contractors as their contracts stipulated. Uber argued that it provides the technology platform that enables the connection between drivers and passengers.

In 2016 in South Africa, the Commission for Conciliation, Mediation and Arbitration (CCMA) issued a ruling that seven Uber drivers who had been ‘deactivated’ from the Uber platform and had subsequently referred unfair dismissal claims to the CCMA were not independent contractors but should be considered employees. Uber South Africa (SA) however appealed the ruling. The CCMA found there was an employment relationship between seven ‘deactivated’ driver-partners and Uber South Africa. However, the Labour court subsequently overturned the ruling that Uber drivers in South Africa are employees.

This would have meant these drivers would have been given employee protection in terms of the Labour Relations Act and the Basic Conditions of Employment Act. In the UK, around 15.6% of the workforce make up the gig economy. The figure is 36% in the US, which is  approximately 57 million people and is expected to rise to 43% by the year 2020. 


In a survey by Oracle, responses from 800 decision-makers including chief marketing officers, chief strategy officers, senior marketers, and senior sales executives from France, the Netherlands, South Africa, and the UK indicated that 80% of businesses aim to implement chatbots by 2020. When asked which emerging technologies they are already using and which they intended to implement, 80% of respondents said they already used or planned to use chatbots by 2020. Chatbots are interactive software platforms that reside in apps, live chat, email, and SMS and can behave in a human-like manner. Furthermore, the survey showed that business leaders and decision makers are turning to the broader umbrella of automation technologies, which include chatbots for things like sales, marketing, and customer service. This will affect the banking and insurance industry amongst others

The driving force of the South African economy which is the mining industry has been losing jobs. Tourism, another key sector for job creation is also facing challenges. The Tourism Business Council of SA (TBCSA) called for Airbnb to be regulated as it is threatening the viability of incumbent lodging providers such as hotels and could lead to job losses.

As we can see from the cases mentioned above the labour market and business models are going through a radical transformation. Automation is inevitable and the Uber cases offer a glimpse into its imperfections in two distinct markets. It is fast making up a large chunk of the total workforce and it is growing. This provides an opportunity for politicians and entrepreneurs to learn. Additionally, this will help mitigate strikes and protests(a labour uprising) if it is approached proactively while it is still a relatively new phenomenon

What will all these developments mean for the FUTURE of EMPLOYMENT Seeing that jobs are increasingly becoming limited?

Africa is proving to be a mobile first market, having leapfrogged land lines. This is proving to be the same with banking: fintechs are engaged in a fiercely contested land grab for previously unbanked consumers, due to a growing population and a shortage of teachers and school infrastructure. The same might happen in education.

While these might constitute digital and technological advancement (innovation), they pose a threat to employment as we know it. Although the Gig economy provides flexibility, it is known for not providing “workers” with protection and benefits enjoyed by permanent employees as seen in the labour disputes above.

According to the World Bank, South Africa Is The World’s Most unequal country. With SA’s rising unemployment, formal employment as we know it might cease to exist not just in SA but globally. If so what will replace it? Will the jobs that remain need to be allocated equitably? Will we see a gig economy and labour market that rotates work amongst people on an equal basis rather than long term? Will data captures, promoters, call centre agents, software developers etc. need to rotate jobs?  

Solutions on how to navigate the gig economy and labour market

In the developed world, permanent employees use gig economy jobs to supplement their incomes. As one of the most unequal societies in the world, government and business should partner and reserve gig economy jobs strictly for those who do not have formal or permanent employment so that the inequality gap is reduced. South Africa and other emerging economies need to pay close attention to the advancements and disruption caused by automation and legislate for gig economy jobs to be reserved for those coming out of higher education and those who don’t hold permanent jobs. 

This will ensure no one stays idle for too long as this has dire consequences such as depression and crime. This might also boost entrepreneurial activity.

Other Possible Solutions could include:

  1. Reskilling initiatives of labour in digital skills driven in partnership with labour unions(South Africa has very active unions in all sectors of the economy)
  2. Making digital skills a compulsory module in all universities, TVET and college courses. Ashesi University in Ghana is already doing this 
  3. Making Coding a subject in schools and organizing other activities to promote learning in digitization.  A typical example of this is Africa Teen Geek.
  4. Helping unemployed youth and graduates to develop digital skills to make them more employable. Oganizations such as WeThink Code and Geekulcha are at the forefront of this in South Africa.
  5. Legislate for gig economy jobs to be reserved for those without permanent employment and unemployed graduates
  6. Legislate for gig economy worker friendly policies and protection

While it might have its pros and cons, the gig economy offers us a glimpse into the future of work. 

A decline in formal employment will definitely put pressure on taxes, making it hard for the government to deliver services and fund development while the population increases. The future might be riddled with labour uprisings as business models change and companies embrace automation and the proliferation of the gig and sharing economy. This however is an opportunity for us to learn from America and Europe and begin to proactively have meaningful discussions and inclusive solutions for the prosperity of our people in the Fourth Industrial Revolution.


The views expressed in this article are those of the author alone and not the Future Africa Forum.