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Two-thirds of SA SMEs struggle for tech talent

New research shows small business adoption of cloud accounting tech has grown by nearly 50% since 2017, but a skills gap remains

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Two-thirds (67%) of South African small businesses struggle to source the right tech talent, according to research from the global small business platform Xero. Despite struggling to hire, only 14% planned to upskill their existing team members to help close tech skills gaps.

Virtually every small business in South Africa has adopted technology they now rely on, with 97% investing in new technologies in 2019. Adoption of cloud accounting leapt from 13% in 2017 to 61% in 2020, indicating that more than half of small businesses can now manage their finances remotely. Despite this, it is clear that many small businesses don’t have the right skills to support the shift.

Before the lockdown regulations, 61% of small companies planned to allocate a portion of their budget to tech training. However, as many SMEs had to make difficult staffing decisions during the lockdown, much of this money will have been redirected. 

Colin Timmis, Country Manager at Xero South Africa and professional accountant, says: “It’s great to see small businesses embracing digital tools, but investing in technology is only the first step.  Many small businesses don’t yet have the skills to match. We need a greater focus from government and technology firms on closing this gap, and helping small businesses develop the right skills to build back faster and stronger from this crisis.

“If you are struggling to hire external talent, focus on upskilling tech champions in your current teams. Even if your budget is modest, look at what skills you currently have in your organisation that can be built on, make use of free online training and ask for help. For example, your accountant will be able to advise on digitising finances and talk to other business owners who’ve implemented new tech recently.”

When asked which skills gaps existed in their team, the biggest gaps that respondents reported were in cloud computing  (39%), programming and app development (33%), digital product management (12%), digital project management (10%), and digital design (9%). To try and close the gap, a little more than half (55%) said that they had invested in improving cloud and tech skills over the last year.  

Read more findings from the research on the next page.

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