SA banks struggling to find talented accounting and financial staff

The shortage of skilled workers has become chronic in South Africa and is having a direct effect on growth. Banks and companies are finding it particularly hard to fill positions with accounting and financial staff, according to two separate reports released by recruitment companies Adcorp and Manpower.

While employment in general is in decline in South Africa - latest official data show that last month the number of people in work fell for the first time this year at an annual rate of 2.5% - demand for high-level and professional workers continues to grow at a 21.95% rate in June. Adcorp calculates there are over 800,000 professional vacancies - with accounting the most-cited sector - and that the shortage has pushed salaries up by 286% since 2000.

The talent shortage is "desperate", says Loane Sharp, a labour market analyst at Adcorp, and at least partly due to South Africa's "highly uncompetitive immigration policies, which prevent high-skilled foreigners from finding work in SA.

The most recent amendments to the Immigration Axct, promulgated in April, prohibit the use of immigration agents and quota work permits, both of which have historically been widely used by SA companies seeking foreign skills."

This explains why South Africa's labour market competitiveness fell by 8.1% over the last year to 133rd position in the world, according to World Economic Forum data. The country's labour laws and regulations are now regarded as the 7th most restrictive out of 139 countries in the world.

A survey of the world's 1,000 largest multinationals puts restrictive labour regulations as the 4th most problematic factor in doing business in South Africa - citing in particular firing practices, labour unrest and wage inflexibility as obstacles.

Research by Adcorp shows that restrictive labour laws and trade union intransigence are the main obstacles to job creation. If the current trend is allowed to continue, says Richard Pike, Adcorp Ceo, "the number of unemployed could grow to a staggering 12m in the next five years." The solution is "easing restrictive labour legislation, investing heavily in skills development and opening doors to foreign skilled labour. There are no quick fixes but there will have to be some quick fixes in the short term."

Peter Winn, managing director of Manpower SA, says that "even if not all employers are feeling the strain associated with the talent shortage, external forces will most likely soon make them feel the pressure.

Businesses need to adopt a long-term approach to ensure that they have the talent they need to achieve their objectives." The climate is not positive and confidence seems to be very subdued, according to Winn: hiring expectations are "stuck in low gear" and "employers report disappointing hiring plans for the coming quarter. The financial sector in particular reported the least optimistic forecasts since the Manpower Employment Outlook Survey began in 2006."