Discuss THREE possible reasons why the government should consider it important to support young upcoming entrepreneurs.

Activity 1.3 1.1 Retrenchment Definition: Retrenchment is the permanent dismissal of employees due to operational requirements such as restructuring, downsizing or economic reasons. Effect on unemployment: It leads to structural and cyclical unemployment as workers lose jobs and may struggle to find new ones matching their skills. 1.2 Skills Development Act of 1998 (SDA) Definition: The SDA aims to develop skills of the South African workforce through learnerships, apprenticeships and training programmes to improve employability. Effect on unemployment: It reduces frictional and structural unemployment by equipping workers with relevant skills needed by employers. 1.3 Social costs of 80% youth unemployment: Increased crime and social ills like drug abuse and teenage pregnancies. Higher dependency on social grants, straining government budget. Loss of productivity and skills development in the economy. 1.4 Three challenges hampering job creation in the formal sector: 1. Strict labour legislation increasing costs for employers (e.g., minimum wage). 2. Skills mismatch between education system and job market needs. 3. Economic slowdown and high cost of doing business (e.g., electricity, regulations). 1.5 Yes, informal jobs counteract unemployment by providing immediate income, skills practice and reducing reliance on grants, though they lack security. Activity 1.10 1.1 Entrepreneurs should be risk-takers because: Business ventures involve uncertainty in markets, competition and finances. Innovation and new ideas require investing time/money without guaranteed success. Calculated risks lead to rewards like profits and growth. Avoiding risk limits opportunities for expansion and problem-solving. 1.2 Three reasons why the number of young potential entrepreneurs could be low: 1. Lack of funding: Youth have no collateral for bank loans or access to startup capital. 2. Fear of failure: Limited experience makes them risk-averse due to potential loss. 3. Inadequate education/training: School curriculum focuses less on entrepreneurship skills like business planning. 1.3 Two ways government support can determine entrepreneurial success: 1. Provide low-interest loans and grants through institutions like NYDA or SEFA. 2. Offer mentorship, training and incubators to build skills and networks.