Type
Outcomes-based funding
Impact focus
Youth employment, social enterprise growth, nonprofit scaling, strengthening social finance systems
Partners
Government and public sector:
- Presidential Youth Employment Intervention (PYEI) via the South African Presidency
- National Skills Fund (NSF), which operates under the Department of Higher Education and Training (DHET) as the outcomes funder, providing the initial R300 million funding in a pay-for-performance model.
Technical assistance and design:
- The Michael and Susan Dell Foundation supported the initial design
- Krutham designed and administers the fund through the employment outcomes nonprofit company Jobs Boost.
Implementors
- Afrika Tikkun, Amazi, Blulever, Business Process Enabling South Africa (BPESA), Cheeba Cannabis Academy, Employment Solutions Management (ESM), Foundation for Professional Development (FPD), Green Riders, Swift Skills Academy, The Collective X, The Tourism and Business Institute of Southern Africa (TTBISA), V&A Waterfront.
The fund uses performance-based funding to incentivise social enterprises and nonprofits to deliver measurable youth employment outcomes, including recruitment, job placements and job retention.
The challenge: Create meaningful youth employment
Youth unemployment in South Africa is severe and input-driven training often fails because it’s not market-driven.
An alternative funding model
The Jobs Boost Outcomes Fund shifts from input-based grants to an outcomes-based model that pays only for actual jobs created. “The worst-case scenario is that money is unspent – but it is never wasted,” says Riyaadh Ebrahim, programme director at Krutham.
“Instead of spending on skills development that may or may not lead to a job, the spending is focused on the job itself – analogous to paying for a pizza instead of paying individually for all the ingredients,” Ebrahim explains. “This removes the human element and any biases, which leads to a drastic reduction in the costs of administration and directs funds into areas where success is guaranteed.”
Risk shifts to implementing partners, who are paid in four tranches: programme enrolment (20%), job placement (40%), three-month retention (20%) and six-month retention (20%). The fund is exploring additional public-sector outcomes funders.
Desired outcomes and measurement
The fund measures:
- Youth enrolled in programmes
- Job placements secured
- Retention at 3 months
- Retention at 6 months
“We structured it in this way so that organisations would receive funds on enrolment, which partially carried them through training,” explains Ebrahim. “We would have liked to look at sustained employment at 12 months rather than six, but there were time limits.” Evidence is independently audited and disbursements are tied to verified milestones.
Project lifespan and tracking
The pilot launched with R300 million in 2023, and implementation began in August 2024. Progress is tracked via a custom-built data portal. As at mid-2025, results include:
- More than 8 100 youth enrolled
- More than 5 600 job placements
- More than 4 000 youth have sustained employment at three months
- More than 2 000 youth have sustained employment at six months
“Our target is 4 500 young people achieving sustained employment over six months and we believe we will exceed this,” notes Ebrahim.
Key challenges and lessons learnt
The project was not without its implementation bumps. “We didn’t really want to go into the ‘gig economy’, but one of our partners created a ‘housing structure’ that essentially houses gig workers in a formal employment structure. We didn’t plan sufficiently around this, and we’ll be a lot wiser in future,” Ebrahim says.
There was a tendency to conflate stipend employment with the authentic employment that Jobs Boost aimed to achieve. “We were clear from the start that all salaries must be fully remunerated by the employing entity, but there was still some confusion that arose,” he points out, adding that there were delays with organisations working with sub-implementing partners. In addition, Krutham had to custom-design an end-to-end data system after realising off-the-shelf products were inadequate.
An unanticipated issue was payment delays, which meant managing expectations. “Implementation partners incurred costs before receiving payment, so we’ll need to include cashflow assistance in future,” Ebrahim notes. He recommends making site visits and “staying close to the programme” as an administrator to understand the story behind the numbers.
Why the Jobs Boost Outcomes Fund stands out
The Jobs Boost Outcomes Fund is one of the largest youth employment outcomes funds globally and aims to raise R1 billion in investment in the next phase. It shows how well-designed outcomes contracts can efficiently allocate public capital, reward real impact and reshape both funding practices and impact measurement.
“The initiative has de-risked public-sector investment and supports the scaling of proven job-creation interventions,” says Ebrahim. “This approach not only improves accountability and efficiency in how youth employment programmes are funded but also strengthens the broader social finance ecosystem, positioning South Africa as a regional leader in outcomes-based and performance-driven development funding.”
“This approach is being considered across the southern and East Africa regions where we are involved in a number of discussions around establishing similar funds,” he says. “This drastically changes the face of public sector expenditure.”
