Revenue Strategies that Encourage Graduates’ Funding Initiatives in South African Public Universities

Abstract

As a result of the increasing unemployment rate amongst youth in South Africa, this study sought to investigate revenue generating strategies aimed at sustaining universities financially in the long run whilst focusing primarily on placing graduates in employment opportunities emanating from business start-ups or business partnerships led by universities.Under the theme of developing university revenue strategies that create graduates’ work opportunities, two research questions aimed to address the role of universities in supporting graduates’ business start-ups. The study examined how university-led graduates’ initiatives could serve as a significant contributor to the university’s third income strategy, whilst simultaneously reducing youth unemployment, which is currently one of the biggest challenges in the South African economy. The focus was on all twenty-six South African public universities using secondary data that was already publicly available. A positivist epistemology, using a quantitative research method, was used when statistically testing the first key research question which was conducted by demonstrating the strength of statistical association between two variables through applying the Pearson’s correlation test. Thereafter, in the second research question forecasting technique determined how universities can realize benefits aimed at generating extra revenue from investment contributions made towards graduates’ investment initiatives through forecasting anticipated targeted Returns on Investments. Key findings demonstrated that there was a significant association between each university’s net profit and the graduates produced, and the funding subsidy from the South African government in higher education also confirms this practice. The forecasting approach using the Excel Solver equation was possible to apply in addressing the target return on investment. This implied providing positive guidance in solidifying executive decisions to strategize allocating a university profit proportion as the basis of financing capital resources supporting university-led graduates’ initiatives for creating work opportunities. Keywords: Revenue, Funding, South Africa, Publica Universities.