This is how many rich executives would leave South Africa without a second thought
A new poll shows that not all well-heeled top executives want to flee South Africa because of the current weak economic and political climate – but there are those who would leave without a second thought.
The annual Bonus and Salary survey by executive search firm, Jack Hammer, shows that at least 3 out of 10 executives are prepared to leave South Africa without any hesitation – despite improved sentiment among executives in general, compared to 2015.
Notably, the number of executives prepared to drop the country is down from findings in the 2015 report, which marks an improvement for the country, according to Debbie Goodman-Bhyat, CEO of Jack Hammer.
The report found that prospects for executives are positive, with the businessmen and women feeling generally confident that they will be fairly compensated – in terms of 2016 year-end bonuses and salary increases in 2017 – despite the roller coaster on which South Africa finds itself.
“The findings of this year’s survey are significant, given that the prevailing sentiment in the country seems to be one of doom and gloom in the face of a mooted ratings downgrade, and with the economic growth forecast revised downward to 0.5% from an already low 0.9% in February,” said Goodman-Bhyat.
The 2016 Bonus and Salary survey polled senior executives and managers in various sectors – including retail, financial services and manufacturing – about their expectations of bonuses, salary increases and business growth in the New Year.
In 2016, 50% of leaders expected to receive bonuses either in line with or exceeding that of previous years. This year, 77% of leaders expected the same, indicating a positive market sentiment that belies the country’s apparent challenges.
At 82%, most respondents in the latest poll indicated that they expected at least an inflation-linked increase, up from 71% last year. Few respondents expected little or no increase.
Read: Weak rand bites the rich as South Africans flee the country
“Despite incredibly challenging times, great uncertainty about the local political landscape in particular, and global economic and political stability in general, there is a marked overall, somewhat counter-intuitive air of resilience around business,” said Goodman-Bhyat.
Contrary to expectations, only 12% of respondents indicated that business was really bad, with no growth prospects at all.
The majority (65%) were of the view that business was solid, albeit admittedly tough. A quarter (24%) of respondents expressed a wholly positive sentiment, with stated prospects for growth and opportunity.
“There also appears to be a renewed commitment to making things work – in one’s company and in the country,” said Goodman-Bhyat, arguing that this could be as a result of an increasingly vocal and active business and civil society mobilisation.
Read: This is who is emigrating from South Africa – and where they are going
Goodman-Bhyat said that contrary to dinner-party conversations, the survey shows that relatively few leaders would consider leaving the country to pursue international opportunities.
Only 29% said they would leave the country without hesitation.
“Considering the sample group surveyed, people who are professionals in their field with myriad local and global options, this is a much lower than expected,” Goodman-Bhyat said.
“It is significant that 71% of respondents either gave an outright or conditional ‘no’ to moving abroad to further their careers. Of the conditional no’s, respondents indicated that they would only consider a move for ‘pull’ factors, such as an exciting and lucrative opportunity, rather than push factors.”
Findings from a New World Wealth report earlier in the year shoed that almost 1,000 South African millionaires left the country in 2015.
The group defines millionaires as dollar millionaires – high net worth individuals with net assets valued at $1 million or more.
According to NWW’s estimations, about 950 millionaires (11% of all millionaires lost) left the country in 2015 – leaving for places such as the UK, Australia, the USA and Canada. Mauritius and Israel were also destination countries.
Between 2000 and 2014, approximately 8,000 HNWIs left the country – a number now closer to 9,000 by the end of 2015.
A survey conducted among emigrants revealed that financial concerns were the main reason to leave – but social issues also played a big part.
Here are the primary reasons millionaires are leaving:
- Financial concerns.
- Inability to deal with changing social dynamics in SA.
- Concerns for children’s future – particularly around schooling and universities.
- Crime – rape and hijacking concerns were highlighted.
- BEE requirements in doing business.
- Concerns that someone in their family may contract HIV/AIDS due to prevalence of virus in SA.
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