By Nkosinathi Mahlangu, Youth Employment & Entrepreneurship Specialist at Momentum
Group Foundation
South Africa’s informal and gig economy has become a lifeline for millions of young people struggling to access traditional employment opportunities.
From ride-hailing drivers and delivery riders to freelancers and informal traders, many young South Africans are building livelihoods outside formal labour systems.
But as government moves toward formalising parts of the informal economy through proposed labour reforms, experts warn that legislation alone will not be enough.
The bigger question is whether young workers are prepared for what comes next.
The rise of South Africa’s gig economy
For many young South Africans, gig work is no longer a temporary side hustle or stepping stone.
It has become the primary route into income generation in an economy where formal employment opportunities remain limited.
Workers often operate without:
- employment contracts
- paid leave
- medical aid
- unemployment protection
- labour representation
Yet they remain essential to the daily functioning of urban economies.
Proposed labour reforms could change everything
The proposed Employment Laws Amendment Bill 2025 and Labour Relations Amendment Bill 2025 aim to expand the legal definition of an employee to include many gig workers.
If enacted, the changes could potentially extend key protections such as:
- minimum wage coverage
- paid leave
- protection against unfair dismissal
- collective bargaining rights
The reforms signal a major shift in how South Africa may regulate platform-based and informal work.
Rights mean little without understanding them
While the proposed reforms could offer important protections, experts argue that legal rights only matter if workers understand how to exercise them.
Many young gig workers entered the informal economy without exposure to formal workplace systems or training.
As a result, common challenges include:
- limited understanding of tax obligations
- difficulty interpreting contracts
- uncertainty around labour rights
- lack of knowledge about dispute resolution
Unlike traditional employment environments, gig work often leaves workers to navigate these systems entirely on their own.
Why labour literacy matters
Momentum Group Foundation Youth Employment and Entrepreneurship Specialist Nkosinathi Mahlangu says labour literacy must become a priority as South Africa’s labour market evolves.
This includes teaching young people practical knowledge about:
- contracts
- taxation
- workplace rights
- dispute resolution
- employment obligations
Experts believe these skills should become embedded within:
- schools
- youth development programmes
- Technical and Vocational Education and Training colleges
TVET colleges face growing pressure to adapt
Technical and Vocational Education and Training institutions are increasingly viewed as critical entry points into the modern workforce.
However, experts say many institutions still focus primarily on technical skills without adequately preparing students for the realities of informal and gig-based work.
There are growing calls for stronger partnerships between education institutions and industry to improve:
- work-integrated learning
- entrepreneurial readiness
- labour market adaptability
- financial literacy
- labour rights awareness
A changing definition of work
South Africa’s labour market is evolving rapidly as platform-based work, freelance employment and informal income generation continue expanding.
The proposed reforms reflect broader global conversations around how governments regulate gig economy workers while balancing flexibility and labour protections.
For young workers like Siyanda, formalisation could create greater security and recognition.
But experts say the success of these reforms will ultimately depend on whether workers are equipped with the knowledge and confidence to navigate the system effectively.
The bottom line
South Africa’s push to formalise the informal economy could reshape the future of work for millions of young people.
But legislation alone will not solve vulnerability in the gig economy.
Without stronger labour literacy, education and support systems, many workers may still struggle to fully benefit from the protections designed to help them.
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