South Africa’s fourth largest asset manager, Coronation Fund Managers, has warned that the country is becoming a skills-scarce environment, with increasing emigration resulting in fierce competition for talent.
This was revealed in Coronation’s condensed financial results for the year ended 30 September 2023.
Coronation is one of South Africa’s largest asset managers, with R602 billion under management.
The company said it finds itself in an increasingly intense competition for talent in South Africa’s financial services sector.
“We operate in a skills-scarce environment, with increasing levels of emigration, and in an industry where the competition for talent is fierce,” Coronation said.
It has increased its investment in attracting and retaining talent and the creation of succession plans.
Coronation warned that the lack of skilled workers threatens the sustainability of the asset management industry in South Africa.
Fellow financial services company Momentum Metropolitan previously said it was locked in a “war for talent” in the financial services sector.
The company also warned that employing more people with the requisite skills is increasingly difficult, putting it at risk of failing to achieve transformation targets.
“South Africa is facing an acute critical skills crisis, especially African, coloured and Indian skills, due to increased local and international competition and emigration,” the company said.
“We face the risk of skills shortages, particularly in critical skills such as actuarial, IT and technical talent. This has amplified in the evolving working environment.”
Talent retention, burnout, and fatigue are all concerns, especially in specialist areas, and talent attraction remains challenging,” Momentum said.
The shortage of skills is not limited to the financial services sector, with construction giant WBHO saying that it is a problem across the entire economy.
WBHO’s chairman, Louwtjie Nel, warned that South Africa is facing a significant talent drain across multiple sectors due to the many challenges the country is facing, particularly rising crime and corruption.
“There is an urgent need for South Africa to prioritise upholding the rule of law. The adverse effects of not doing so are becoming increasingly obvious,” Nel said.
“Crime and corruption function as significant deterrents to business and investor confidence, demanding swift and decisive action.”
Of great concern for Nel is that many young professionals, including engineers and quantity surveyors vital to the construction industry, are departing in search of opportunities abroad.
“This trend does not merely impact the construction sector. It has far-reaching implications for the national economy,” Nel said.