An investigation of key aspects in township economies that influences the rate of unemployment

Abstract

In the context of South Africa, unemployment is an essential concept. Different aspects determine the unemployment rate. As the economy grows, the unemployment rate decreases, and one has to look at the SMMEs that play a significant role in the growth and sustainability of a country's economy and entrepreneurship. In South Africa, there are townships, which are located outside cities, which are formal and informal settlements engaged in legal and illegal activities. This study was done on the four municipality districts of the North West Province, where townships' economic activities are examined. The purpose of this study is to determine which key aspects of the township's economy affect the unemployment rate. The research is focused on only the townships in the North West Municipality Districts. As for the problem, there is a perception that there may be a lack of entrepreneurial skills, and therefore foreigners are driving the township economies. The primary objective is how township economies are influenced by different influences, this study's secondary objectives are that the current state of township changes economically due to the high unemployment rate. The target population was business owners in the townships, where they answered selected interview questions. The study's delimitations were that not everyone understood English or Tswana and that the business owners are afraid that this study is linked to the Government. The findings of this study support the problem statement, the findings indicates that the different demographic areas plays a significant role for influences the unemployment rate as well as the profile of the owners and the type of services that are provide in the townships of the four North West Municipality Districts. The value of this study also indicates the possible solutions for unemployment. This study aslo gave an input of how the future of SMMEs in South Africa will be and the important role of entrepreneurship for the development of a country. The limitations in this current study was that some population didn’t want to complete the selected interview questions, because of the language, xenophobic attacks and there was a problem to get access to certain business owners, because of the high number of migrants.

This current study also indicates that there are areas for further research such as empowering woman entrepreneurship in townships as well as the need of sport and recreation in the townships. The state of approach for this study was done through selected interview questions that were sent to the four North West district municipalities to determine the key aspects in township economies that influence the rate of employment in South Africa.