(Gaby Gramm writes from a South African perspective, but the skills gap is a common scenario is many countries around the world and her approach to the way forward is applicable globally – Ed).
South Africa is an emerging country with abundant natural resources and a growing middle-income population. Much of its infrastructure is today already excellent. Many areas received extensive facelifts in preparation for the 2010 Soccer World Cup in South Africa and now boasts the continent’s first high-speed rail service and many world class hotels and restaurants. It possesses well-developed financial, legal, communications, energy and transport sectors.
But, South Africa is a land of enormous contrasts. Its unemployment remains high at 24 percent, and economic problems inherited from the apartheid era, including poverty, lack of economic empowerment among disadvantaged groups still exist. SA’s skills shortages are widely regarded as a key factor preventing the country of achieving a 6% growth, this with rapid growth on the rest of the continent. However there is still uncertainty as to the nature and extent of such skill shortages. Only 41 percent of South Africa’s working-age population participates in the economy, and there are only 5.9 million registered individual taxpayer. About 65 percent of the country’s workers are employed in the services sector. With high unemployment and this growing skills shortage, South Africa struggles to accommodate its growing job sectors. In terms of the capability ranking featuring all the countries (Capability gap index), South Africa features as number four in the world ranking, with the fourth-largest gap (-23). Japan has the largest gap at -47.
When looking closer at the hospitality industry in South Africa, this sector is dominated by small businesses. Typically these do not belong to a chain, and many are owner managed. Skill shortages within hospitality are mostly experienced at worker level, and formal qualifications of Hospitality workers are significantly lower than those of workers in the related industries of Travel and Tourism. A very high percentage (54%) of workers are unskilled, i.e. lack basic numeracy and literacy skills.
Furthermore, South Africa’s education system is near the bottom in global comparisons—it ranks 138th out of 144 countries in general scholar education. Students who graduate with a degree often do not necessarily have the skills required by South African companies. When companies are able to find and hire the right talent, these sought-after individuals tend to leave either the company or South Africa, a trend reflected in high rates of job switching and emigration by those with tertiary education.
The government has a long term plan to deal with the issue of education. The National Development Plan was launched in 2010 and is designed as an instrument to address the key challenges facing South Africa. Amongst these is the plan to increase of quality of education. Its planned actions should create learner ships and make training directly available to job seekers. This ambitious undertaking can only be a success with full participation of all businesses and enterprises in the various job sectors.
The challenges for hospitality businesses
The combination of long working hours and poor compensation in the hospitality industry has translated into a relatively high staff turnover rate. This is problematic for long-term staff development and sustainable training efforts, which is a costly investment. Further stumble blocks to expose staff to training are the high season demands and the pressure that comes with it. All investment usually demands to see a return and most companies are not able to assess the benefit of training and together with expertise needed to provide training. This goes particularly for smaller owner-managed businesses where there is no one available or assigned to develop competencies of employees to improve their performance.
The department of education admits itself that it was recommended that the tourism curriculum and skills development programmes be designed in a manner that addresses the needs of the sector, thus bridging the gap between the education system and the workplace, preparing graduates for employment immediately and make them attractive for the market place. Government initiated programmes such as CATHSSETA’s Skills development programmes are so far under-utilised. Employers and tourism businesses are encouraged to play their role in attracting and retaining skills within the sector and are encouraged to utilise these initiatives to aid and stimulate the sustainability of the tourism sector. It is about spending not spending skills levy money on any dubious programs but to ensure that selected programmes cover the necessary skills level and have value to be up-to-date with the demands of today’s industry.
Global consumer trends have indicated that our industry is expected to get busier as the frequency of travelling and eating out is predicted to be ’significantly higher’ by 2020. With this comes an increase in consumer quality expectations and the rising popularity of specialised cuisines and unique dining experiences. An increase in consumer expectations in particular around quality will be more important when eating out in 2020 than it is today. Consumers are expected to be even more value-conscious than they are today and will demand even more locally-sourced menu choices. This requires adaptation of skill.
The way forward
To face the challenges of the future and ensure that your business is not crippled by skills shortage facing SA as a whole, the following approach which is actually not complex is recommended:
Grow your own
Hotel companies, even if small, need to develop internal programs to create attractive career paths so that potential candidates see employment as a professional career opportunity with real potential for growth. Recruiting for entry level jobs is easier when a career path can already be outlined and can show examples of managers who have worked their way up from line positions.
Develop a clear picture of your talent gap
One needs to be clear of the extent of the talent gap and where this gap is critical. Just as much as a business changes, the gap does too – demand and supply factors as well as promotion and retention rates in a particular talent field need to be closely looked at all times. That way one can focus their efforts on recruitment, training and development, promotions and retention on the most crucial areas of the business.
Get out more of your scarce talent
That means ensuring that employees use their skills in the area they are trained for, not for administrative or unfamiliar and unrelated tasks to the actual position.
Make the line managers accountable for talent management
Too many talent drives fail because they are overseen by human resources departments out of the operation instead of managers who work with and are in a position to identify talent. HR is generally falling behind in structure, skills, analytics, technology and the development of leading recruiting and learning and development programmes. Line managers on the other hand can’t do their part to identify and fill talent gaps without targets and accountabilities. HR’s role and acute focus area is to continuously track progress and keep on their operational managers and deal with the ‘overwhelmed employee’.
There are many reasons given for the troubles the SA economy finds itself in today. The failure of the education system to provide the requisite skilled labour of a modern economy to its key sectors, such as it is tourism for South Africa, is a prominent factor and one that can no longer be ignored if the country wants to remain a key player in the global tourism arena. Greater real involvement by businesses is called for, not just bemoaning the crippling shortage of skills.
(Sources: Deloitte’s Global Human Capital report 2014 for South Africa, www.theta.org)
About the author
Gaby Gramm is the Managing Director and Owner of LuxTravelEx, a company offering marketing and operational solutions tailored to the luxury hospitality industry. Gramm started LuxTravelEx after completing her Executive MBA at the University of Cape Town. With over 24 years of hands-on hospitality experience within the luxury hotel sector, and solid relationships with an extensive local and international network of industry players, she has also worked on a number of exciting consulting projects, notching up valuable global experience as an independent consultant.
