CEOs in South Africa are less confident than their global counterparts regarding their growth prospects in 2018, according to PwC’s 21st survey of 1,293 chief executives around the world.
Moreover, local bosses warn of potential staff cuts due to automation and other technology in the future.
Globally, the majority of CEOs are optimistic about the economic environment amid geopolitical uncertainty, corporate misconduct and the impact of artificial intelligence on the future job market, the financial services firm said.
Fifty-seven percent of global business leaders say they believe global economic growth will improve in the next 12 months. This percentage is almost twice the level of last year (29%) and the largest ever increase since PwC began asking about global growth in 2012.
Only 22% of CEOs in South Africa however, are “very confident” of their company’s own growth in the next 12 months – 20 points below the global average (42%). The global survey results, based on interviews with almost 1,300 CEOs from 85 countries. In South Africa 41 CEOs from a broad spectrum of listed and privately-owned companies participated in our online survey.
It is notable that 37% of South African CEOs – compared to 58% in 2016 – plan to increase their headcount in 2018, while 54% of global CEOs plan to increase their headcount.
In addition, only 18% of CEOs globally, compared to 22% of CEOs in South Africa, expect to reduce their headcount. Two-thirds of South African CEOs say this is mainly due to automation and other technologies.
A report published earlier in January, by global consultancy Accenture, showed that 35% of all jobs in South Africa are currently at risk of total automation, meaning machines can perform 75% of the activities that make up these jobs.
Accenture said that both blue and white-collar jobs are at risk, adding that re-skilling may also ultimately be the deciding factor as to whether the South African economy survives the fourth industrial revolution.
“The jobs of clerks, cashiers, tellers, construction, mining and maintenance workers all fall into this category,” it said.
Hard-to-automate jobs (those with a lower risk of automation) include tasks like influencing people, teaching people, programming, real-time discussions, advising people, negotiating and cooperating with co-workers, Accenture said.
Similar to the WEF’s findings, Accenture found that if South Africa can double the pace at which its workforce acquires skills relevant for human-machine collaboration, it can reduce the number of jobs at risk from 20% (3.5 million jobs) in 2025 to just 14%(2.5 million).
PwC’s survey found that on digital skills specifically, over a quarter (28%) of CEOs are extremely concerned about their availability within the country they are based, rising to 49% being “extremely concerned” in South Africa, 51% in China and 59% in Brazil.
“Investments in modern working environments, learning and development programmes and partnering with the other providers are the top strategies being pursued by CEOs to help them attract and develop the digital talent they need,” it said.
While recent research by PwC found that workers were optimistic about technology improving their job prospects, CEOs admit that helping employees retrain, and increasing transparency on how automation and artificial intelligence (AI) could impact jobs is becoming a more important issue for them.
Two-thirds of CEOs globally, compared to 67% in South Africa, believe they have a responsibility to retrain employees whose roles are replaced by technology.
To prepare for the digital age the majority of CEOs (91%), compared to 90% of CEOs in South Africa, strongly agree that they need to strengthen soft skills such as teamwork and communication alongside digital skills.
More than two-thirds of South African CEOs say they are taking action on a number of fronts – ranging from the way they work, to engaging external service providers and improving remuneration and training for their staff.