South Africa must increase its investment in developing local talent if it is to deliver the high-quality workforce its businesses need to thrive, according to a new study by the World Competitiveness Center at IMD, a leading global business school.
The annual IMD World Talent Ranking assesses the methods countries use to attract and retain talent.
Among the BRICS countries, South Africa ranks in the middle position — 48th — performing better than India (51st) and Brazil (52nd) but lagging behind both China (40th) and Russia (43rd).
The IMD World Talent Ranking is based on countries’ performance in three main categories — investment and development, appeal and readiness. The three categories assess how countries perform in a wide range of areas. These include education, apprenticeships, workplace training, language skills, cost of living, quality of life, remuneration and tax rates.
The study draws on an in-depth survey of thousands of executives from 63 different economies, and more than two decades’ data from the IMD World Competitiveness Center.
South Africa’s strengths are in total expenditure on education (4th), cost-of-living index (1st), personal income tax rate (2nd) and labor force growth (7th).
Its main weaknesses are in the pupil-teacher ratio (primary education, 61st), implementation of apprenticeships (61st), availability of skilled labor (60th), capacity of the educational system to meet the talent needs of the economy (60th) and emphasis assigned to science in schools (60th).
Other indicators which point to the country’s low ranks are health infrastructure (52nd), worker motivation (57th), brain drain (58th), attracting foreign highly-skilled personnel (52nd) and availability of competent senior managers (50th).
The top economies in the IMD World Talent Ranking—with European countries holding 11 of the top 15 spots—share similar attractiveness indicators.
“They invest significantly in their outstanding educational systems, they offer a superior quality of life, and they offer substantial opportunities for career advancement throughout the entire professional life span,” the report said.
Besides Mongolia and Venezuela, which capture the last two positions in the IMD World Talent Ranking, the lower places are dominated by Eastern European countries like Croatia, Romania, and the Ukraine.
“While the decline in the latter is due to the investment and development of domestic talent in addition to the political crises that characterize the area, Croatia and Romania’s decline is partially explained by the decrease in the appeal and readiness factors,” the report said.