The urgent need to reskill South Africa's youth for the AI future

From: The Centre for Alternative Political and Economic Thought

Date: 06 June 2025

Dear Chairperson, Honourable Tebogo Letsie

India, a fellow BRICS nation with socio-economic challenges comparable (if not greater) to South Africa, is expected to reach its 1 million demand for its artificial intelligence (AI) professionals by 2026.

If India can aggressively reposition its education system to meet the demands of AI and automation, surely we can join this race.

This recent development from India, compounded by a global demand for Indian AI professionals, presents a critical avenue for South Africa.

South Africa faces similar inequality; the country's Gini coefficient is forecast to amount to 0.60 in 2025, while India's Gini coefficient is forecast to be 0.35. (Statista, Global data and business intelligence platform). What is evident is that India’s trajectory proves that technological transformation can occur alongside, and even help mitigate, deep structural inequality.

Now the world’s fifth-largest economy in the world and projected to take over Japan and Germany in 2030, India still contends with extreme disparity, yet over the past decade, it has achieved remarkable 4IR progress by deliberately targeting inequality as a developmental lever.

India proves that inequality need not delay 4IR readiness, it can actually drive more inclusive innovation when made a policy priority.

Consequently, as South Africa commemorates “Youth Month under the theme Skilling and Empowering Youth for the Future” we are compelled to sound the alarm on an existential crisis facing South Africa’s young people.

• 4.9 million South African youth aged 15-34 are currently unemployed according to The Quarterly Labour Force Survey.
• 58% of unemployed graduates are under 35 according to StatsSA.
• Over 45% of existing jobs face high risk of AI displacement.

A 2024 report by Investec also reveals a critical disconnect between industry and curricula stating that; while South African private sector firms scramble to compete in the AI race, with a majority reporting severe shortages of AI and data science skills, our education system produces fewer qualified graduates annually to meet this demand.

Basic and higher education institutions remain dangerously misaligned with industry needs, forcing companies to either import foreign talent or lose ground technologically.

Surely, without urgent curriculum reforms, expanded technical training, credible and competent deployees at our SETA’s and public-private partnerships to bridge the AI skills revolution, South Africa faces a crisis of monumental structural unemployment.

Systemic failures in education, skills development, and economic policy would leave millions permanently excluded from meaningful participation in the modern workforce. Especially young people who are already unemployed and unemployable.

The latest reports from Goldman Sachs predict that: “AI could displace 300 million jobs globally by 2030, while McKinsey warns that 375 million workers worldwide will need to switch careers entirely due to automation.”

These staggering figures take on terrifying significance, as Paul Colmer, starkly warned in his recent TechCentral article (2 June 2025): “The question isn’t whether AI will transform our world, it’s whether we will build the infrastructure and social frameworks necessary to navigate this transformation successfully.”

Facing similar challenges of youth unemployment and inequality, India has engineered one of the most remarkable transformations in modern education history.

As we submit this report to your committee, there is currently a Global Scramble for Indian AI Talent.

Microsoft has just announced its plans to invest over $3 billion in India as it affirms it’s interest to acquire Indian Tech and talent.

The critical importance of India’s AI strategy becomes evident when examining how global tech giants are competing for Indian engineering talent. A January 2025 investigation by ‘The Ken’, a respected Asian tech business analysis publication, titled ‘Microsoft targets Nvidia’s AI-chip empire with an army of Indian engineers’, revealed how Microsoft is recruiting entire teams of Indian AI engineers from companies like Nvidia to build competitive AI chip architectures.

This mirrors similar talent raids by Google, Amazon, and Meta, who have collectively hired over 15 000 Indian AI specialists in the past three years alone. For perspective, Nvidia stands as the preeminent global supplier of advanced processing units specifically engineered for artificial intelligence applications across industries.

At the same time, the Top 500 Fin/tech Fortune companies are spearheaded by Indians. This global demand underscores a painful paradox for South Africa: our own tech sector remains critically dependent on Indian expertise, while the country is failing to develop homegrown talent.

The Indian government has, however, moved decisively to counter its own brain drain. Through initiatives like the $1 billion IndiaAI Mission and tax incentives for returning diaspora experts, India is transforming from being the world’s tech back office to becoming a self-sufficient AI innovator. Where Indian engineers once powered America’s Silicon Valley’s growth, they now develop cutting-edge AI solutions for India’s economy in India.

Under Prime Minister Modi’s leadership, the country is projected to produce over 1 million AI professionals by 2026 through:

• Complete overhaul of technical education at the Indian Institutes of Technology
• According to a report by Gartner, the year 2025 will see 2 million new jobs generated by AI and Machine learning in India
• A joint study conducted by Microsoft and the Internet and Mobile Association of India revealed that India’s AI market is expected to witness a growth of 20% over the next five years, the second fastest rate globally behind only China.
• The “FutureSkills Prime” platform to reskill over 50% of the Indian professional workforce annually.
• Startup incubators focused on healthcare, agriculture and climate tech
• 40% of seats reserved for rural students in top programs, including an affirmative action reservation policy that proactively reserves seats for disadvantaged castes to study technology and related studies
• The National AI Marketplace which is a Government-funded platform connecting 50,000 AI startups with industry. And projected to add over $500 billion to GDP by 2030
• The Semiconductor Mission with $10 billion investment to make India self-reliant in chip design • A 2024 report by American software company, ServiceNow, predicts that India would have created close to 3 million new tech jobs by 2028.

While India surges ahead despite its challenges, we face painful contradictions as articulated by various experts and academics:

• Media, Information and Communication Technologies Sector Education and Training Authority (MICT SETA) is embroiled in SIU investigations, with the current and former board chairs embroiled in various scandals, while seemingly those deployed to lead this SETA are not appropriately qualified to lead South Africa’s AI Race.
• Our universities produce fewer AI and tech graduates annually than industry demand. A 2024 information and communication technology (ICT) skills survey reveals a shortfall of around 77 000 high-value digital jobs in South Africa, with an additional 300 000 technology positions being outsourced abroad.
• Despite having 24 public higher education institutions, South Africa’s education system is struggling to keep up with the demands of an expanding technology ecosystem. African Business Quarterly, Tania Griffin 2024.
• South Africa’s ICT skills gap is further exacerbated by ‘skills recycling’ and the shortage of teachers in science, technology, engineering and mathematics (STEM). Institute of Information Technology Professionals South Africa’s (IITPSA’s) ICT Skills Survey 2024.

The SETA deployment system also exacerbates our crisis. Of course, all political parties practice Cadre Deployment. The ANC, which is leading the GNU, has produced enough capable, progressive experts, black, coloured, Indian and white. The ANC must ensure that its cadre deployment policy prioritises truly committed professionals and experts who understand and can implement the party’s vision of ‘People’s Education for People’s Power’.

This Youth Month, we therefore implore the committee to:

• Declare AI/tech Education Emergency
• Convene a National Indaba on AI Readiness to assess our education system’s capacity for 4IR and jobs of the future, and audit government support for tech research and R&D
• Declare 2026 as the year of Youth Skilling and partner with BRICS Plus countries like India, China and Saudi Arabia, including countries in the Global North and Advanced Asia
• Collaborate with Unions to ensure their members are reskilled to mitigate against a job blood bath.

Honourable chair, India, with its own challenges similar to ours, proves that sustainable transformation is possible if there is Political will. Their youth unemployment rate has dropped 12 percentage points since launching these AI reforms across the board.

As we celebrate Youth Month, we must remember the words of Isithwalandwe /Seaparankwe Oliver Tambo, who opined there follows: “The children of any nation are its future. A country, a movement, a person that does not value its youth and children does not deserve its future.”

We encourage the committee to remember these profound words by OR Tambo this Youth Month.

Yours in urgent solidarity, Phapano Phasha, Executive Director, Centre for Alternative Political and Economic Thought.

* The views expressed here do not reflect those of the Sunday Indepedent, IOL, or Independent Media.