Recruiters have seen a decline in demand across most industries within South Africa as companies look for ways to increase output and productivity, while at the same time cutting costs. Instead of hiring more people, they are turning to automation, robotics, artificial intelligence, digital and broader technology to achieve these goals.
This is the conclusion reached by Michael Page International in its 2020 Guide to Salaries & Skills in South Africa. However, the company has also identified fascinating trends in technology recruitment.
“We have seen an increased need for strong commercial leaders with the capabilities to steer businesses through these challenging economic times, focusing on guiding and leading the workforce, and increasing the bottom,” says Paul Newman, associate director of Michael Page South Africa.
“The last year has proven to be challenging for the professional labour market within South Africa, due to various economic and political reasons. The year started cautiously, with the General Elections held on 8 May, and investors adopting a ‘wait and see’ approach. This has, however, continued with policy uncertainty such as expropriation of land without compensation, underlined by the highest unemployment rate since comparable data was recorded in 2008, peaking at 29.1% in the third quarter of last year.
“Overall, we have seen a decline in demand across most industries within South Africa, with certain industries feeling the impact more than others. Companies are looking for ways to increase output and productivity, while at the same time cutting costs. Therefore, automation, robotics, artificial intelligence, digital and in broader terms, technology is playing a bigger role in achieving the above mentioned goals.
“South Africa is also facing a brain drain of highly skilled labour who are opting to emigrate; this is creating a talent gap in the market, further contributing to the challenges of investing in the economy.”
Newman points out that 2019 will also be fondly remembered by South Africans as the year the Springboks won the 2019 Rugby World Cup and Miss South Africa was crowned Miss Universe.
“There is a renewed sense of hope and achievement spreading across the country. South Africans are resilient and have overcome many challenges in the past. There are some real success stories to celebrate all over the country, from innovative start-ups showing phenomenal growth and a fresh new approach to doing business in Africa, to larger multi-nationals with world-renowned structures and processes continuing to be pillars of the economy.”
Kagiso Rangaka, manager at Michael Page Technology South Africa, says The big incumbent banks have always been heavily invested in technology, but much of this investment had been towards maintaining legacy infrastructure and making incremental change, with limited incentives to disrupt.
“Even efforts that were intended to be ‘disruptive’, were often poorly conceptualised and offered more theatrical than bottom-line value. However, this is changing for two key reasons,” he says.
“Firstly, a deteriorating economic outlook is forcing incumbents to finally ‘bank’ the benefits of past digitisation efforts by cutting branches and workforces. This will only be expedited by new investments in robotics that, with little systems impact, automate data entry and checking that was still being done by humans.
“Secondly, new capital, a more open regulatory environment, and customer discontent, has led to the emergence of new entrants that are unconstrained by legacy systems, bloated workforces and inertia. Tyme Bank, Discovery, Yoco and Jumo have been able to leverage new tech and business models from the get-go. Such entrants are forcing incumbents to invest more, and demand more from their tech and innovation efforts. Big bets are being made in innovation processes, cloud and AI.”
Rangaka says bets in innovation processes and collaboration tools should help make available more relevant customer value propositions quicker. Cloud platforms should help incumbents become more agile, in terms of both lower cost scalability as well as in being able to integrate best of breed services and partners.
“The informed application of AI should empower incumbents to better offer the nuanced, personalised experiences that big tech (Google, Apple, Facebook and Amazon) has made customers get accustomed to. These bets will all be underpinned by the skills required to secure, manage and optimise networks, especially those in the cloud and new mobile application endpoints.”
These bets are reflected in the skills that companies say they are currently lacking, as well as what they expect to need in future, says Rangaka. As a result, there will be losers as well as winners.
“Mainframe specialists will have to re-tool to develop micro-services. Project managers will have to morph into Scrum masters. Data analysts will have to learn the No-SQL paradigms prevalent in the AI world. Application developers will have to apply their skills to the Internet of Things and mobile. Not everyone will cope.
“Companies will have to mix new recruitment with up-skilling, contracting, off-shoring and fintech partnerships, as skills shortages, increased specialisation and needs volatility may not make full time onboarding practical.”
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