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       PRESS RELEASE

South Africa not training effectively to pull economy into economic upturn

10 November 2008

Major training organisation urges more careful thought in selecting courses

By Liza van Wyk

Matric exams begin this week and finals are underway in universities, last year half of matriculants failed and companies report that many graduates have below par skills all of which poses challenges for business and one which not enough are rising to meet.

South Africa ranks at the bottom of many rankings for skills training – and many businesses, despite having big budgets for training take too little care in choosing the right course.

“A company that chooses with care sees immediate positive effects in productivity and the bottom line,” Liza van Wyk, CEO of management training organisation AstroTech says. “A 10% increase in productivity adds one percent to the bottom line. When one considers that South Africa’s productivity and training ratings are at the bottom of many skills ranking systems it adds to concerns about how we can pull out of the current economic downturn.”

Training facilitator Liesl Gini said there was often “a short term investment in crisis, instead of a long term thoughtful investment in training. What we are seeing is that because so many people are scared of losing their jobs in these hard times, they are not mentoring or sharing information and so the workplace is becoming less productive. Teamwork is becoming a casualty of economic crisis. A good skills plan should be part of every business strategy.”

Van Wyk pointed out that it was difficult to assess which sectors were best or worst in terms of skills development, “in our experience the financial services sector, especially banks are the best. Eskom and the mines have also dramatically improved their skills training. However, the most recent StatsSA General Household Index showed that the Trade sector experienced the biggest growth in terms of the percentage of ‘more skilled’ employees (from 12,7% in 2002 to 17,7% in 2007).

“Yet the Financial Mail Empowerment Index this year said they had not had a single financial services company in their top 10 last year. This year the winner was Kumba Iron Ore which spends seven percent of its payroll on skills training.” In 2007, Edcon was the top scoring empowerment company in South Africa, it spends 3,4% of its payroll on training and each of the group’s 20 000 employees spends an average of one week a year in training. In 2007 it trained more than 1 000 SETA learners.

Yet research by the World Bank’s Investment Climate Survey shows that South Africa trains only 44,6% of skilled workers, compared to 77,3% of skilled workers receiving ongoing training in Brazil, 69,1% in China, 55% in India and 78,9% in Poland. It found too that individuals who receive additional training are valued more by companies, they tend to earn a third more than those who do not receive training.

The US State Department 2008 Investment Climate Assessment of South Africa notes: “A 2005 survey of South African businesses sponsored by the World Bank and DTI queried domestic and foreign firms about South Africa's investment climate. Constraints most often mentioned were the lack of skilled labour, labour relations and crime. A 2005 survey conducted by the American Chamber of Commerce in South Africa reinforced these views.”

AstroTech’s findings with regard to spending on skills training seems to coincide with those found by the FM Empowerment Index and Kumba – “the biggest spend goes on business support and administrative staff, especially on courses involving financial skills, including business writing and financial reporting, as well as project management,” Van Wyk said, “while anything upgrading the capabilities of personal assistant’s is always a run-away success.”
Kumba Iron Ore says 60%-70% of its skills training budget goes to the technical upgrading of staff as well as compliance training and direct leadership programmes for first-line managers and upwards. It has also trained about 20% of SA's artisans.

The FM said there “should be more pressure on CEOs to pledge their collective assets on skills spend.”

Van Wyk advises that those sending staff on training should always consult with the training company to ensure they are sending staff on the most appropriate course or courses:

· Ensure training is part of strategic planning.
· If the company has long term goals evaluate what skills training will be needed to help it attain those goals.
· High level information sharing, mentoring and coaching expands the benefits of good skills training to more staff.
· Well trained staff are more valuable and are more likely to be poached in a skills starved nation like South Africa, so make sure that those who effectively implement the skills learned in training receive commensurate reward.
· Every staff member should go on at least one course a year to keep up with rapid changes in the world of work.

“We are heading into a very tough, lean, mean economic season,” Van Wyk said, “the only way to emerge from it strongly is to hold onto your best staff, train them so they become even better and work harder.”

* Astro Tech is a major South African training organisation based in Johannesburg. It targets executives and managers in the public and private sector for training in management, people skills, information technology and project management. Each year close to 3 000 people take part in more than 60 courses in Johannesburg, Durban and Cape Town. Many more receive specialist in-house training.

FOR FURTHER INFORMATION CONTACT:
LIZA VAN WYK, CEO ASTRO TECH 011 453 5291 cell: 082 466 8975 or liza@astrotech.co.za www.astrotech.co.za
MediaOnLine mediaonline@global.co.za 011 646 7637