Stellar Search

Talent grab: Africa’s skills shortage

Blog post   •   Jul 09, 2013 18:47 SGT

Market Scenario: Africa is happening now!!

Africa’s economic pulse has quickened, infusing the continent with a new commercial vibrancy. Real GDP rose by 4.9 percent a year from 2000 through 2008, more than twice its pace in the 1980s and ’90s. Telecommunications, banking, and retailing are flourishing. Construction is booming. Private-investment inflows are surging. Most countries are at peace, the economy is flourishing, mobile phone penetration is better than most emerging Asian economies, life expectancy has risen by a tenth in the last 5-6 years and most importantly, FDI has tripled.

Availability of the Talent in Africa:

The recent research reveals that the highly-skilled categories which are suffering the greatest skilled shortages are:

·  Senior Management;

·  The professions – Medicine, Engineering, Accounting and the Law;

·  Technical Occupations – Specialized Technicians and Artisans; and

·  Agriculture

Also, the biggest challenge in Africa is that, broadly, Organizations don’t have the necessary mechanisms to identify talented individuals. The skills availability that they are able to report on, namely the formal work sector, represents only a fraction of the skills group in the continent, and excludes those individuals who hold required and desired skills.

Africa is suffering from skills shortage, as the continent also has an abundance of untapped potential.  The Companies are not using the right methods of recruitment. In the last five years, online recruitment has became an essential HR practice in the US, as 92% of companies now recruit via Facebook, Twitter, and LinkedIn.

Also, the Organizations need to implement a reward strategy that attracts the best talent by determining remuneration, by written formal pay strategies, differentiating employee pay, work life initiatives, long term service awards etc.

Africa’s skills shortage means that companies have to increasingly up their game in attracting and retaining top employees in a market of growing competition for talent. Despite increased investment in remuneration programmes, organizations need to implement a reward strategy that attracts the best talent.

The availability of skilled people in Africa is there, but mostly untapped which leads to hire the expats. Only half of companies have moved online and technology is still used in a very basic way to advertise on job boards and direct candidates to an email address or applicant tracking system. A tiny number of companies have fully woken up to social recruitment and are driving relevant jobs and content to niche online communities to engage talent.

We see three big opportunities this year:

1. Mobilizing recruitment: With Africa’s 650-million mobile phone owners growing 40-fold since 2000 and eight in ten South Africans now owning a mobile phone, it is the best way to reach candidates, especially blue collar workers. Different to the US, Africa will have 85% non-Smartphone users by 2015, which makes SMS an ideal communication channel.

Recruiters should start figuring out how to integrate mobile into the recruitment process as a job application channel. When looking for options, choose software that not only does mobile marketing of job ads, but can also automate the job application process via various mobile channels including SMS, mobile Internet, Instant Messaging (like Mxit) and USSD.

2. Opting for job aggregators: Job boards are based on an outdated model of big databases with no relationship to job seekers and poor integration to social media, if any. The traditional SA job board model has been to charge companies large sums to advertise their jobs with the chances of success being somewhat of a lottery. Aggregators are disrupting the market by collating and featuring jobs from multiple sources on one site for free.

Only the strongest and most innovative will survive and the days of the traditional job board is numbered. Recruiters need to start focusing on aggregators like Indeed.co.za for smarter use of their budgets and better exposure on a job-search tool giving candidates what they really want: quick, simple and effective search of their job niche.

3. Tapping into relationships: While personal recommendation is a top source of outside hires, most companies don’t have formal referral practices. Recruiters need to make sure employer branding is well executed on their career sites. By making jobs easy to share across social networks, employees will be even likelier to pass on opportunities. Equally important is to properly track and reward referrals to avoid great candidates falling through the cracks and to continue encouraging great leads.

An increasing number of vendors are now building candidate referral systems. Integrating these with an applicant tracking and workflow system can easily help track referrals along with the source, comments, notes and other content to make better hiring decisions.

Mixture of Expatriate and Local Staff

Africa has a significant shortage of management and specialized skills. It is estimated there will be a 75% increase in the use of expatriate staff over the next three years, and the strategic use of these resources will be a critical success factor to help establish and grow business across Africa.

On a managerial salary, a repatriate would typically earn between $30,000 and $50,000 per annum. Hiring an expatriate can cost four times as much.

Most of the companies go for a combination of local and expatriate workers in Africa. There has been a projected increase in FDI into Africa, which will in turn mop up the talent. The demand for talent in Africa is going to outstrip supply. As a result of the higher demand for talent, the price of talent is going to go up, and it will continue to go up for as long as there is a skills shortage.

Skills Transfer:

Companies should also go for skills transfer, wherein whenever a company brings in foreign staff for a specific project in Africa, it should make sure that there should be “skills transfer” to local workers. It is very important to have a transfer of knowledge as whenever the time comes when there is a glitch in the system, the company should not call the foreign staff to resolve it.

Companies like IBM imports skills for projects on the continent, it also exports African skills to international projects.

This concludes that while bringing in EXPAT (foreign staff) for a specific role in Africa, companies should make sure that their skills are transferred to the local workers. It will help organizations to grow talent in-house also.

 

By KM Kannan - Consultant Stellar

Simi Manocha- Associate Consultant Stellar

kannan@stellarsearch.com