IT WAS the well-built young man dressed in torn jeans and waiting on the side of the road for offers of work who reignited feelings of anger, sadness and frustration in me.

I drove slowly past him, studying his facial expression. He had a plastic bag packed with what looked like tools. He was ready for whatever opportunity might present itself.

My conclusion was that our country is struggling to win the war against youth unemployment and that it would take a miracle for more young people to be absorbed into the labour market.

That miracle, according to the government, is the Employment Tax Incentive (ETI), one of the most zealous youth employment programmes in SA's recent history.

In theory, 178000 new jobs would be created in three years through the government's direct stimulation of the labour market.

This intervention entails marginally reducing the cost to company of employing young people.

It is the practicality (or lack thereof) of this project that made me investigate its effect, a year after its implementation and a week before President Jacob Zuma delivers his state of the nation address.

Pardon me for succumbing to the temptation of explaining the obvious but important contributing factors to SA 's stubborn youth unemployment rate.

On October 19 2012 former president Thabo Mbeki delivered a lecture on Oliver Tambo as part of the ANC's centenary at Fort Hare University.

Mbeki said South Africa had "a predominately landless, property-less and unskilled African majority, constituting more than 75% of the population . much of it unemployable because it does not have the skills required by a modern economy and society".

The problem, Mbeki pointed out, is largely caused by our education system that has failed to equip the youth.

Another enormous challenge is South Africa's stringent labour legislation (designed to protect older workers) that has made it too risky and expensive for employers to set up shop here and take on new staff.

The World Economic Forum's Global Competitiveness Report for 2014-2015 shows that South Africa lags behind on a number of indicators essential for robust economic growth that can lead to the creation of new and better job opportunities.

Of the 144 countries analysed in the report, SA ranked second-last for flexibility of wage determination, 143rd for flexibility of hiring and firing practices and 144th for cooperation in labour-employer relations.

It is within this rigid labour environment that the ETI is expected to miraculously create jobs.

The question remains: has the rate at which young people find or lose jobs changed since the ETI's implementation?

The ETI's effects in the first six months of its introduction were found to be "small in magnitude" by a 2014 University of Cape Town report.

This could be because it had not yet gained traction. In fairness, even a year might be too soon to gauge its impact.

Converting the ETI from a youth wage subsidy to an incentive means that small firms that have the potential to hire more young people are effectively excluded because they are not registered for Pay As You Earn.

There is no evidence internationally that these kinds of incentives work.

In countries like Venezuela, Peru and Argentina the interventions, according to the UCT report, were somewhat successful because money formed a vital part of the initiative. But irrespective of the cash injection, the incentive still needs to be skills-based and exist in a flexible labour market.

Back home it would not be surprising if the same young man in torn jeans resorts to crime or looting foreign-owned shops. The ETI has not gained traction. It needs to do so fast.

A huge number of unemployed young people with no hope and very little to lose is a dangerous thing.

Gumede is a radio talk show host and a freelance writer

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