Although the growth of South Africa’s black middle class has more than doubled over the past eight years, growing from 1,7-million people in 2004 to an estimated 4,2-million in 2012 – according research by the UCT Unilever Institute of Strategic marketing – there is still much that has to be done by both business and government.
This is according to Adam Samie, CEO of Lion of Africa Insurance, who says that South Africa needs a fundamental mind-shift where all sectors of its society, business, labour, civil society and government hold hands to develop specific outcomes-based solutions to deal with the various challenges faced by the black middle class.
“We need a much more effective plan and cohesive strategy from all role players to make things work and to deliver real value,” he says.
Samie explains that the idea behind this methodology is that businesses across the economic sector that have access to capital should invest strategically in initiatives that involve the majority of the people in South Africa.
“This would enable us to move the proportion of economically active people in our country to include the vast majority of our population and perhaps produce a productive market of between 20-million and 30-million people.
“Not only will this deliver wealth and create opportunities for everybody, but will certainly lead to a better quality of life, and we should then be able to expect a reduction in crime, HIV, improved medical facilities, better housing, job opportunities and so forth. It is only through putting people to productive use that we can be able to lead on to an economy that actually produces for everybody,” adds Samie.
He says that business can play a huge role by developing and empowering local contractors, as well as small businesses.
“This would effectively create opportunities for business to engage with previously disadvantaged people and black entrepreneurs who can come in, obtain some of these jobs, and in that way create wealth for themselves.
“This is very closely tied to the fact that we still need to create and facilitate the development of these skills in the economy. For example, in order to bring black plumbers into the equation, there needs to be an understanding that black plumbers are available and can perform, and do these repairs to the required standards,” explains Samie.
“Consequently, business can intervene by making sure that the sector contributes towards training that is specifically tailored to bringing in black entrepreneurs and people from historically disadvantaged areas across a broad expense of economic areas and expertise.”
According to Samie, government also has a major role to play and currently does this through Sector Education and Training Authorities (SETAs) and various initiatives.
“Although these initiatives mean well and uplift citizens, Government and business need to start working together to develop a cohesive strategy that will lead to the creation of real jobs, up-skill people and enable them to take up positions across various industries.
“The development of the black middle class is really about the upliftment of the previously excluded portion in South Africa. Therefore, allowing access to them should be considered an economic imperative.
“As good corporate citizens, business needs to continue working hard to try and improve the quality of access and to make products and services available to a wider group of citizens. Uplifting the black middle class and people from previously disadvantaged backgrounds is not about providing facilities for free, but rather empowering them to grow and make a meaningful contribution to our country’s economy,” Samie adds.