South Africa’s Minister in the Presidency, Jeff Radebe, at the recent World Economic Forum Workshop reminded us that “countries today are competing in a knowledge-based global market where the key differentiators are skills, expertise, know-how and the ability to deliver excellent services speedily, with agility and efficiently”.
He elaborated on this when he added that “the demand for job-specific skills has been growing around the world” and that “globally, corporates suggest that the quality and supply of skilled labour is a major binding constraint to growth. Employers around the world are also suddenly demanding that new hires have both technical and ‘soft’ skills (that should have been acquired earlier on in their educational foundational phases).”
Minister Radebe didn’t emphasise the unemployment rates and lack of skills but instead drew attention to the fight for top talent.
When businesses look for specific skills and experience the talent pool shrinks considerably. The South African context is even more challenging because only 25% of our labour force is skilled. If we look at the local Finance and Insurance sector for example, the available skills dip to only 13%, in Manufacturing to 12%, and in IT and Telecommunication only 8%.
While we have been talking about the “war for talent” for many years, Alan Russell, MD of ThornTree recruitment services, says: “We are now also facing increased competition from international companies. We particularly see this in the finance and tech sectors where a number of South African organisations, thanks to innovations in areas like remittance, payments, authentications and mobile security, have expanded operations to the rest of the continent and beyond. These companies employ talent with world-class skill.”
Talent that is very attractive to international competitors who can offer opportunities to work on even more innovative projects and in countries with better exchange rates, possibly even better career prospects.
Even though options for skilled job seekers continue to increase rapidly, Russell states that “many local companies are still driven by risk averse practices and therefore keep tightening up the recruitment process and adding more steps to avoid employing the wrong person. This in itself is the sensible approach, but the negative impact is that they are not participating in the race for the best talent.”
Another challenge framed by the Minister was the increased demand for soft skills. Russell affirms that this has become the reality today. “A large proportion of our clients are changing the way they look at potential employees – which we’ve seen specifically in the IT and Software Development world. In the past the average developer was thought to be someone that would operate in an isolated room in the back office. This is so far from the truth today where it’s now common practice to extensively test aptitude and personality compatibility as well technical skill because individuals form part of productive teams which requires a level of soft skill to operate effectively.”
This creates even greater pressure for hiring managers to be swift about employing the candidate that proves to be a match for the role.
The Minister’s statement emphasises a point that companies may be wise to heed. That is, to enter the race for talent catch up with the other participants. South Africa is in the cycle of a “candidate driven market” for skilled talent, so if you want to secure the best of the best revisit your human capital strategy and move heaven and earth to make your star candidate a swift and lucrative offer.