Report reveals urgent need to invest in tech skills development and training to ensure Africa capitalises on youth

Given Majola

There is an urgent need to invest in skills development and training to ensure Africa can capitalise on its youth dividend. This is according to Cathy Smith, managing director at SAP Africa.

Speaking at the SAP Africa release of the Tech Skills Scarcity Revealed report, Smith said it was clear that the challenge for the continent was significant - and there was no one organisation that could solve it alone.

“While I don’t have an answer on when it will improve, what I do believe is that the solution lies in our ability to collaborate. This collaboration needs to extend between all players in the tech ecosystem. This will help to scale existing programmes and create not only skills, but an enabling environment for employment.”

Smith added that more than half of the world’s population growth between now and 2050 will take place in Africa, where 1.3 billion people are expected to be born by mid-century.

“With the correct investment in skills development, Africa’s economy could transition away from its reliance on natural resources to build the world’s future tech workforce, bringing untold economic and social benefit to the continent and its citizens.

“However, as our research reveals, African organisations still face some difficulties with attracting, retaining and upskilling suitably skilled tech workers,” Smith said.

The Africa Tech Skills Scarcity Revealed report 2023 was conducted among organisations in Kenya, Nigeria and South Africa in the fourth quarter of last year. It found that a lack of skills was having a negative effect on the continent’s digital transformation efforts.

It examined how a lack of tech skills was affecting Africa’s digital transformation efforts, which tech skills and capabilities are most in-demand, and what organisations were doing to ensure they can attract and retain the scarce talent they need to grow and succeed in the 21st century digital economy.

Four in five organisations surveyed reported some negative effect from a lack of tech skills, with 41% reporting that employees were leaving due to the pressures they experience as a result of understaffing.

Other consequences included not being able to meet client needs (reported by 46%), reduced capacity for innovation (53%), and losing customers to competitors (60%).

Nearly all organisations expected to experience a tech skills-related challenge this year. More than two-thirds (69%) also said they expected to experience a skills gap in the year ahead.

According to the data, the top skills challenge for African organisations was attracting skilled new recruits, although in South Africa, the retention of skilled employees narrowly edged out attracting skills as the top challenge.

In response to the ongoing tech skills challenges, organisations were taking bold steps to ensure they had access to the correct tech skills, with 41% saying that upskilling of existing employees would be a top priority this year, while 40% said the same about reskilling employees.

Companies were also adopting technology tools and flexible work practices to ensure they could attract, retain and mobilise the correct mix of tech skills, Smith said.

“Seven in 10 organisations currently use a human capital management or employee experience tool, while nearly half (45%) of companies were open to remote work - although most want employees to be in the office at least some of the time.

“This new workplace dynamic will require leaders to co-create new models for work, with constant collaboration with employees to ensure alignment with company objectives and culture.”

The report further found that the most in-demand skills included cybersecurity and data analytics (63%), developer and industry skills (49%), and digital transformation skills (48%). More than two-thirds (69%) cited technical skills as an important attribute when recruiting, while 66% said industry-specific skills were important to them.

Responses also showed that the change management skills that were so essential to successful digital transformation, were not highly prized among the companies surveyed - revealing an opportunity for smarter investment in specific skills to improve the outcomes of initiatives.

“Only 18% of companies cited change management as an in-demand skill,” elaborated Smith, adding that that studies have shown that less than a third of digital transformation projects succeed, partly due to the fact that only 34% of change management projects are clear successes.

Smith said that for a continent that was rapidly transforming through the accelerated adoption of digital technologies, ensuring effective change management could greatly improve outcomes and equip organisations with new capabilities to drive growth and innovation.

Other key findings from the report include that Kenyan organisations were more upbeat about their skills prospects than Nigerian or South African organisations. Only 53% of Kenyan organisations expect to experience a skills gap in the next year, compared to 80% of Nigerian companies and 73% of South African organisations.

Kenyan organisations were more likely to expect employees to work in the office all the time, as 37% of Kenyan organisations want employees in-office full-time, compared to 23% of organisations in Nigeria and only 13% of South African ones.

The top tech skills challenge for African organisations was attracting sufficiently-skilled new recruits, except in South Africa.

Organisations in Kenya and Nigeria cite attracting skilled new recruits as their top tech skills challenge this year, but in South Africa the top challenge was retaining skilled tech workers.

South African organisations placed a greater premium on digital transformation skills, with 70% of South African companies citing them as in-demand. Similarly, 78% of the South African companies surveyed said they suffered a negative impact due to a lack of tech skills.

In an article titled “Africa needs digital skills across the economy – not just the tech sector”, published by the World Economic Forum in 2020, Alejandro Caballero, the principal education specialist at the IFC and Sajitha Bashir, an advisor, Office of the Global Director, Education, World Bank, said the demand for digital skills training in Africa would surge in the coming decade as jobs that previously did not need digital skills would begin to do so.

They said that education providers needed to align their offerings to accommodate this surge in demand. They added that policy-makers and the private sector also needed to work together to improve the necessary infrastructure.