South African Businesses Panic Due To Employee Relocation


Concerns have been raised about the number of people choosing to leave South Africa. More skilled South Africans are taking the plunge and choosing to emigrate to other countries, taking their valuable skills with them, especially the youth.



South Africa is facing a massive unemployment crisis, particularly amongst the youth, who are the ones carrying the burden of the country's lack of jobs.

Many of the youth are contemplating a move to a different country in order to gain some employment. Some have already chosen to do so, in the hopes of having better luck in another part of the world.

Although South Africa's demographic of young people are qualified and have valuable skills under their belts, finding a job is not a guarantee. Emigrating to another country, like London or Australia, presents more opportunities than what is currently available at home. 

A recent survey conducted amongst business leaders has revealed that most of them view employee emigration and relocation as a risk factor for the success and longevity of their businesses, as their employees will take their skills with them. 

"To them, that means the end of the road," says Simonetta Giuricich, Chief Operating Officer (COO) of Playroll, a payroll services group.

"What's particularly interesting is that the top countries where our emigrants are going to, being the likes of the UK for example, I've always thought it was because of ancestral reasons that people could get into the country, but based on the research, it's become abundantly clear that the majority of people that are leaving for the UK are getting in on skilled work Visas; so that means our top skills are leaving," explains Giuricich. 

She continues, elaborating that Australia is the country with the second highest amount of South African emigrants, and is where most of South Africa's youth are choosing to settle.

According to Playroll's research, Australia has strict rules and guidelines for allowing entry into their country, a major consideration being the age of those trying to gain access. 

In addition, Giuricich says an interesting group of emigrating and young South African citizens, are those who "are not leaving, but somehow are still not here." This group, she says, are young people (also with good skills) who are being poached by international companies, who have tapped into South Africa's workforce. 

"They've understood the skills and the talent that we have available to us; it's a good time zone, we speak English, [we've got a] good skills set, and they've decided to tap into the South African talent pool in order to hire internationally," says Giuricich. 

"So now, all of a sudden, what was a talent pool that was physically shrinking, is now also virtually shrinking, and that's the concept of virtual emigration," adding that 40% of South Africa's software developers are working remotely for foreign companies, meaning a "massive loss" for our own industries that are need of software skills. 

Playroll noted that those aged between 25 and 40 years-old are the ones most likely to leave the country and (more worryingly), over half of South Africa’s graduates have the potential to emigrate in the future. Senior employees are also more likely to relocate, probably because they have the financial means to do so, it said. 

The South African Revenue Service (SARS) revealed earlier this year that within the last financial year, around 6000 South Africans have packed up and left the country, even though they are not necessarily high-income earners. 

While choosing to reside and work in a different country is not uncommon, especially as South Africa grapples with its unemployment rate, it leaves the wonder as to how our own skills shortage situation will be improved if those in possession of said skills are across the globe. 

Erica Kempken, founder and director of Youth@Work, says "skills needed today are not skills needed tomorrow."

She says the perpetual problem of youth unemployment in South Africa, is exacerbated by a staggering skills shortage and a hopeless attitude, which in turn has a significant impact on the country's economy.

To regain some control of the emigration panic amongst business leaders surveyed by Playroll, some were able to find a solution that allowed them to continue legally employing those who had left their companies and relocated to a different country, even though they're not in South Africa anymore.

This allowed for businesses to keep their employees without the hassle of setting up a legal entity, setting up a bank account and jumping through the hoops of legal and statutory compliances, that it would normally take to hire someone in a foreign country. 

"Although the person [employee] is physically not here [in South Africa], that person is still actually building a business, just from a different location," explains Giuricich. 

Youth unemployment has seen a bit of improvement, due to ongoing government effort, but the situation is remains dire. 

Nevertheless, at the 2023 State of the Nation Address (SONA), hosted on Thursday, 9 February, President Cyril Ramaphosa issued some small, but important developments in the employment of South African youths.

The President made mention of the value of the Presidential Employment Stimulus, which he drew attention to at the 2022 SONA as well. When mentioned in 2022, Ramaphosa placed emphasis on the initiative's potential towards job creation.

By the time the 2023 SONA rolled around, the initiative had reportedly created 1 million work opportunities, which are said to have reached each of South Africa's nine provinces.

As the country appears to be making improvements in combating unemployment, the slow pace raises the question of whether the country is producing the right kind of jobs, considering the currently existing skills shortage within the labour sector. 


Suggested Article:

Someone's Visa to travel outside of the country.

More skilled South Africans are taking the plunge and choosing to emigrate to other countries, and are taking their valuable skills with them. Citizens have many reasons for choosing to leave, but what does that mean for the country? 




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