Skills shortage - Urban legend or fatal constraint?

A mosaic of views contends as regards the extent and implications of skills on the growth prospects of the South African economy - but what is the best approach to talking about, and solving, the 'skills shortage' and its attendant 'fatal' constraints?

The main two schools of thought on skills in South Africa articulate views at variance with each other. On the one hand there are those who argue that the South African economy faces no skills shortage but is hobbled by underutilisation of the available black skills. On the other hand there is a strong case that the domestic economy faces an acute skills shortage, especially if the recent economic growth is taken into consideration.

However, Jimmy Manyi, the chairman of the Commission for Employment Equity (CEE), who labelled the skills shortage crisis an 'urban legend' and a fervent exponent of the 'underutilisation' theory, calls for a comprehensive research to be conducted on the assertion that there was a lack of sufficient skills.

'The problem would not be as acute if we used our skills properly and some companies are looking for their own clones.'

A major factor complicating the skills shortage debate is the incontrovertible fact that mainstream South African company boards are by and large, still 'male and pale' - overwhelmingly dominated by white males.
According to a report by executive search group Landelahni which focused on the top 100 listed companies, white men comprised 71% of the 1 289 board seats reviewed in the past year while 30% of businesses had no women on their boards.

Given the scenario, the exponents of underutilisation are quick to point out that the skills shortage crisis is exaggerated and used as a pretext to hamstring the transformation drive.

But nevertheless, a slew of research data confirms that skills shortages are not a figment of anti-transformation proponents' febrile imaginations.

Deloitte, a human resource development consultancy, found in a survey on 300 South African companies that an estimated 76% of them are experiencing difficulties in recruiting suitably qualified affirmative action candidates.

Says Louise Marx, Deloitte's human capital manager: 'A lot of companies have to train internally because they have quotas to meet. To my mind the skills shortage is not an urban legend.'

In its latest seminal report, entitled Skills, Growth and Migration Policy - Overcoming the 'fatal constraint', the Centre for Development and Enterprise (CDE) points out several factors that have caused the dearth of skills within the domestic economy.

These include:

  • Higher levels of growth in the South African economy and globally, especially in the commodity sector
  • The South African government's stated commitment to expenditure on growth-oriented infrastructure
  • The government's concerns regarding the recent political upheaval at the local level, sparked by discontent with poor service delivery, attributable in part to shortages of skilled municipal staff. Such protest actions reared their head around September 2004 and have continued intermittently ever since.

Anne Bernstein, Executive Director of CDE, says the serious skills shortage may hamper the government's development initiatives.

'This is a major constraint on our prospects of achieving the kind of sustained economic growth that will reduce poverty and open the way for much wider participation in the economy. The government's Accelerated and Shared Growth Initiative for South Africa (Asgisa) recognises skills shortages as one of the six "binding constraints" on growth, one that is serious enough to warrant its own programme, the Joint Initiative on Priority Skills Acquisitions (Jipsa).'

Even the government acknowledges these challenges, particularly in the public service, in its latest report by the Public Service Commission, which states that 'addressing the capacity challenge in the public service requires dedicated leadership from the executive and senior management levels.'

But nowhere is the shortage being felt than in the managerial and technical fields. According to the Human Sciences Research Council (HSRC), the domestic economy has since 2001 faced a shortage of more than half a million people in these two areas.

The Southern African Institute of Welding contextualises this problem in a more practical way and explains the effects of migration - a phenomenon that is largely responsible for the perpetual brain drain plaguing South Africa and further exacerbating the skills shortage.

'The shortfall of welders in the country has been estimated at as much as 12 000. As few as six people have obtained internationally recognised welding qualifications in South Africa - compared to 2 000 in Germany - in the last five years. Half of the handful who qualified in SA is now being employed abroad.'

The South African Institute of Chartered Accountants notes that the government's 37 departments and 248 municipalities lack adequate numbers of accountants. Government departments, in particular, need about five chartered accountants each, yet they are presently nowhere near that number.

Disconcertingly, South Africa also has to grapple with the shortage of appropriately qualified teachers. The HSRC projects that by next year, the country will be short of 15 090 educators should the current learner-to-educator ratios of 40:1 for primary schools and 35:1 for secondary schools be maintained. Worse still, for a great majority of schools, particularly those in rural and historically disadvantaged areas, these ratios are only an ideal.

Though the government has intervened in the form of Asgisa and Jipsa, the initiatives' impact is yet to be felt by the economy as these are hardly two years old and it takes at least three to five years to discern the tangible effects of most policies.

Moreover, the much-vaunted Sectoral Education and Training Authorities (Setas) are not achieving the desired outcomes. For instance, the National Skills Development Strategy implementation report has recently found that all the targeted 1 669 recipients of training in setting up new ventures have failed to sustain their businesses for at least a year. This case amply shows that it will take a long while before government intervention achieves its ends in this sphere.

The best approach is to look at the skills shortage and its attendant 'fatal' constraints more soberly and as it obtains, without any politicisation of the issue. Where underutilisation and measures to subterfuge the promotion of affirmative action are manifest, it is best to caution the perpetrators and implement the requisite corrective actions expeditiously.

Sello Mabotja