South African business leaders have to reinvent their organisations and get the right skills to cope with a challenging business environment, according to PwC South Africa’s seventh South Africa Economic Outlook report for 2023.
If more business leaders took a skills-first approach, more jobs would be unlocked, yielding greater benefits for the economy and wider society, according to the report released yesterday.
Lullu Krugel, the chief economist at PwC South Africa, said upskilling would be vital to ensuring that South African industries were staffed with people who had the know-how to help drive economic growth and development.
“At a company level, offering training and development opportunities has a quantifiable positive impact on company financials by improving the employee experience. This, in turn, results in fewer resignations and increased profitability,” Krugel said.
The report found that people in skilled jobs lead organisations, which can have an impact in resolving the country’s unemployment challenges.
“In the current environment, where skills gaps appear to be widening, and more employees than ever are struggling just to get by, South African business leaders cannot take anything about their workforce or culture for granted,” it noted.
Skilled jobs, for example, engineers, doctors, teachers, and business and legal professionals totalled 4.1 million, and equalled 25% of total employment in South Africa. These workers lead the organisations – both private and public – that would need to contribute to resolving the country’s overall unemployment and related socio-economic challenges, it said.
PwC’s Global Hopes and Fears Survey 2023 found that 61% of South African survey respondents had skills that were not clear from their qualifications, employment history or job titles. This highlighted the need for ‘skills-first’ hiring where people were hired for their skills and competencies, rather than their qualifications.
Marthle du Plessis, PwC Africa Workforce of the Future Platform Leader, said across industries, South African organisations needed a clear and meaningful mandate to attract and retain the right people with relevant skills, following a ‘skills-first’ approach.
“PwC is collaborating with the World Economic Forum to help drive the move towards skills-first labour markets around the world. The move could unlock the labour market for 100 million people globally, delivering benefits not only to businesses and individuals, but to wider society and the economy as well,” Du Plessis said.
The company said at a practical level, the four basic principles of Strategic Workforce Planning were to ensure that an organisation had the right people who possessed the right skills at the right place and time which came at the right cost.
Existing skills were only part of the ‘right skills’ conversation. Upskilling of workers was another important component of workforce planning. However, only a third of local survey respondents believe the skills their job requires would change significantly in the next five years, PwC said.
An employee’s work experience was no longer influenced by singular factors such as pay or a direct supervisor. It was about more than that from the technology they use, to their physical workspace environment, to – importantly, in this report’s context – their learning and development opportunities.
South African industries that spend the most money on training include tertiary sectors like insurance, telecommunications, banking, real estate and financial services. These industries had a large contingent of skilled workers. In the finance space, for example, workers were continuously needing to adapt to changing consumer trends and technologies.
BUSINESS REPORT