South Africa’s skills shortage is affecting all businesses in the country – from start-ups to big corporates – as they struggle to find the necessary tech skills needed to expand.
One such business is fintech start-up, iKhokha, which says it needs to increase its workforce by 50% to meet the demand for its services and its expansion ambitions.
The group, which helps small and medium businesses in South Africa to process card and digital payments, said its business has scaled significantly over the past year and now it needs experienced people to match its new pace of expansion.
However, “the best talent is in high demand and we are competing for placements with other growing digital companies in South Africa and other countries,” it said.
“To challenge entrenched market players, digital businesses need to innovate, but at times battle to find the technical expertise to do so.
“It’s ironic that in South Africa, with a 29% rate of unemployment, the situation is even more challenging. Not only does the number of jobs far outweigh the number of skilled applicants, but because we are behind first-world countries when it comes to digital proficiency, so is our talent pool,” the group said.
According to iKhokha, candidates that apply for positions often lack the technical know-how and experience required to develop globally competitive solutions.
The group said the shortage of skills is primarily in risk analysis, software engineering and creative, HR and finance roles. It has 50 positions open.
South Africa needs skills
The problem faced by start-ups like iKhokha are prevalent across South African businesses.
It said that it has drawn talent from other companies like FNB, Standard Bank, Accenture, Deloitte – but these companies, in turn, also struggle to draw the right skills for their businesses.
In the South African finance sector especially, many local banks have spoken about the struggles of finding the right technical skills.
Capitec CEO Gerrie Fourie previously indicated that the bank is in desperate need of skilled data engineers, machine learning guys and IT professionals – going so far as to say that he would hire 100 of these professionals immediately if he could.
The bank is looking to expand its workforce by 600 people in the short-term.
African Bank is another group that has spoken about the skills shortage in the sector, also identifying the same technical skills – security and data science – as holes that needed filling.
With larger companies, the solution often lies in upskilling employees internally. However, this is resource-heavy and runs the risk of having those employees poached by competitors.
Other strategies being implemented are to pay higher salaries to draw talent – but even in these cases, companies say they are taking months to fill positions.
According to the latest CareerJunction Index, which tracks the job demands from thousands of listings in South Africa, the most in-demand job skills are in software development, middle/department management and representative/sales consulting.
Software developers in particular are offered high average salaries, ranging from R35,000 to R50,000 a month.