South African employees can expect higher pay rises than workers worldwide in the next year, but tough economic conditions and lack of skilled labour may put a damper on the country’s long-term prospects.<\/p>\n
According to Grant Thornton<\/a>‘s International Business Report survey, 68% of SA companies plan to increase salaries in line with inflation over the next 12 months.<\/p>\n A quarter (26%) of companies said they would increase salaries above inflation – while 5% of SA companies said they would not increase salaries at all.<\/p>\n “It is important to remember, though, that SA\u2019s inflation is higher than in other countries and one must take this into account when assessing real increases,” Grant Thornton said.<\/p>\n South Africa’s figures contrast the lower wage increase expectations of the BRIC nations (Brazil, Russia, India and China) where 18% of businesses said they would not increase wages over the next year.<\/p>\n 21% of global companies said the same.<\/p>\n Only 15% and 14% of BRIC and global companies, respectively, said that they would increase wages above inflation.<\/p>\n \u201cSA\u2019s labour unions and collective bargaining councils ensure that employees get salary increases every year, which sets the tone for the private sector,\u201d said Ian Scott<\/a>, managing partner for Grant Thornton.<\/p>\n \u201cBut, continuing to increase salaries every year in a struggling economy places SA firmly in the danger zone for rising inflation over the next 12 months \u2013 and this could have a negative impact on this county\u2019s growth expectations for the year ahead,\u201d he said.<\/p>\n A big problem South Africa faces, according to Scott, is a lack of skilled and technical labour.<\/p>\n According to the survey, 83% of local businesses reported a lack of technical skills when it came to recruitment. Only 61% of BRIC economies and 64% of global businesses reported this challenge.<\/p>\n 58% of SA businesses report difficulties in recruiting skilled workers.<\/p>\n Scott said that it\u2019s imperative for business and government to work more closely to find solutions to SA\u2019s employment crisis.<\/p>\n \u201cSA also needs to urgently increase productivity, which is far behind many other countries globally, if we are to see business growth and economic success,\u201d he said.<\/p>\n On a positive side, the survey revealed that 43% of South African companies are hiring more people when compared to previous years – and staff were being retained.<\/p>\n The data for this report was drawn from interviews with 3,450 global CEOs, managing directors, chairmen or other senior executives from all industry sectors conducted in November and December 2012.<\/p>\n Repo rate unchanged<\/strong><\/a><\/p>\n Mobility impact on SA\u2019s GDP<\/strong><\/a><\/p>\n SA\u2019s real mobile penetration revealed<\/strong><\/a><\/p>\nGlobal comparison<\/h3>\n
Lack of skills<\/h3>\n
More on South Africa\u2019s economy<\/h3>\n