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Sectors and skills: The need for policy alignment (HSRC sector skills studies; edited volume)

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André Kraak (ed.); Justin Barnes; Erika Kraemer-Mbula; Jo Lorentzen; Il-haam Petersen; Johann Maree; Paul Lundall; Shane Godfrey; Rhoanda van Zyl; Thomas E Pogue; Sean Archer; Andrew Paterson; Joan Roodt; Nicci Earle-Malleson; Avril Joffe; Monica Newton (2009). Sectors and skills: The need for policy alignment (HSRC sector skills studies; edited volume). HSRC Press.
Type book
Scope Post-1994 South African economy
Method mixed
Period studied 1996–2007
Regions South Africa, Gauteng, Western Cape, KwaZulu-Natal, Eastern Cape
Themes manufacturing industrial policy, education human capital, labour markets wages, transition post apartheid, business and state, comparative theory, demography urbanisation
Citation key ed2009

Argument

The volume argues that South Africa's post-1994 industrial policy (Asgisa, NIPF) and skills policy (SETAs, National Skills Development Strategy) must be aligned at sector level, because the economy is highly uneven and a 'one-size-fits-all' skills policy is inappropriate. Fourteen sector studies on high-tech, resource-based, infrastructure, labour-intensive and service sectors combine demand/supply data with firm interviews. The editor's conclusion builds a six-part segmented labour market model combining production regime, state/market regulation and internal/external labour markets, and assigns sectors to segments. Evolutionary economics, value-chain analysis and the 'situated knowledge' of intermediary agencies are the theoretical frame.

Evidence and method

Quantec series built from OHS/LFS (1996-2005), DoE HEMIS and FET output data, SETA sector skills plans, DoL scarce-skills lists, Sunday Times vacancy data, the SAABC benchmarking database (75 firms), DTI sector strategies, and structured interviews with firms and associations (12 auto component firms, 7 aerospace firms, 11 metals firms, etc.). Soweto and Hazyview case studies for tourism.

Findings

  • Auto components firms invest only about half the international average in training, R&D and capital, despite complaining of skills deficiencies. (p. 27)

    South African-based firms have spent only slightly more than half the international average on training, r&d expenditure and capital equipment.

  • Auto components skills demand to 2015 is projected at over 45 000 new and replacement posts, with sizeable artisan demand. (p. 33)

    Management 1 004 759 1 764 Professional 1 126 704 1 830 Supervisors 1 985 1 241 3 226 Artisans 1 333 833 2 167

  • Aerospace employment is tiny and its skills profile is shifting toward intermediate skills. (p. 48)

    the sub-sector ‘manufacture of aircraft and spacecraft’ employed approximately 1 500 people in 2005, contributing about 0.14 per cent of total employment in the manufacturing sector

  • The nuclear, space and biotech platforms face a shortage of high-end critical skills, not of generic graduates. (p. 68)

    On the basis of the available data, it does not appear that there is a material shortage of engineers (Figures 4.1–4.4). Graduates consistently exceed the number of vacancies many times over.

  • Metals employment fell sharply 1996-2005 while capital-intensive milling shed labour despite heavy investment. (p. 93)

    Overall employment for this period (1996–2005) declined by 13.3 per cent or 44 950 jobs

  • Upstream monopolies' import-parity pricing is the main brake on downstream beneficiation. (p. 107)

    the main one identified in this chapter is the pricing policy of the upstream monopolistic mills. Their practices of import parity pricing and differential pricing have served to impede the growth

  • Downstream metals stages are far more labour-intensive than upstream stages. (p. 90)

    Investment per job ranges from only R0.1 million to R0.6 million, while employment per 1 000 tons of steel output ranges from 75 to 150 workers.

  • Chemical sector employment is stagnant owing to automation and capital intensity. (p. 111)

    employment in the chemical sector grew at less than one per cent on average per annum between 1995 and 2005

  • Financial services gained structurally in output and employ far more skilled labour than the average. (p. 256)

    its growth contribution was 32 per cent, almost one-third.

  • Tourism's binding constraints are crime and airlift, with generic rather than sector-specific skills gaps. (p. 313)

    the nature of these skills shortages is generic rather than sector-specific, and can be summed up in four all-encompassing words: attitude, passion, leadership and vision.

  • Retrenchment of state-owned enterprises' training after 1994 and GEAR austerity depleted the artisan pipeline. (p. 334)

    the democratic state cut back dramatically on investment in public infrastructure projects such as the maintenance and renewal of existing road, rail, port and telecommunications infrastructure

  • The conclusion's central claim: a single skills strategy cannot serve a differentiated economy. (p. 350)

    the current ‘one-size-fits-all’ skills development policy of government – particularly in the form of the National Skills Development Strategy – is inappropriate