Africa’s economies are booming, but alongside the consistent growth, a new problem seems to be emerging; one which many hope the diaspora can be the solution for.
A shortage of talent is putting a strain on investment in Africa as education institutions fail to produce the quantity of high level skills required to meet growing business needs. Rapid growth in Africa’s key economic hubs is driving the search for talent to fill critical roles, but a limited number of local staff with management and specialist skills means that a growing number of companies are citing skills scarcity as a barrier to doing business in African countries. Seventy-five percent of CEOs operating in African countries surveyed by PWC outlines a lack of available talent as threat to their growth. New foreign direct investment in Africa is projected to reach $150 billion by 2015, creating 350 000 capital intensive jobs a year (according to an Ernst & Young report) resulting in demand for talent outstripping supply.
“The skills missing in Africa are senior managerial skills that the diaspora have an opportunity to fill”, argued Frances Mensah Williams CEO of Interims for Development Ltd., an HR consultancy focusing on Africa, and Editor of ReConnect Africa, an online careers and business platforms for African professionals. Speaking on the panel of the recent flagship event of the Business Council for Africa’s Diaspora Initiative, she pointed out that many diaspora professionals are willing to move back home for the right opportunity to play a part in Africa’s growth story and are attractive to companies because they know how to deliver the standards international business needs.
Diageo’s Talent & Organisation Effectiveness Director for Africa, Clare Reilly, comments that Diageo currently have to buy in 70% of talent into their Africa-based operations, with only 30% coming from the internal development of local talent. Already present in 40 African countries, Diageo are looking to double their business which makes sourcing good management talent a priority. While they look locally first and into their satellite offices second, the skilled diaspora are their next port of call because they are highly educated, have developed market experience and many have maintained some local networks and understanding of local culture.
A survey undertaken by ReConnect Africa found that 98% of diaspora respondents want to return home to Africa. They are driven in some cases by better opportunities to progress but also by social and cultural ties, quality of life, extended family and the opportunity to go ‘home’. At the same time they are put off by a lack of access to information about jobs, the hiring process, job level and perceived level of reward. After the challenge of attracting diaspora professionals is the challenge of getting them to stay, especially once the rose tinted glasses have worn off.
Remuneration proves to be a contentious topic, as opinions differed on how salaries should be structured for returning diaspora. Few would disagree that there is a role for the diaspora in plugging this high level skills gap, but there is less agreement in what this role should look like and the practicalities of bridging this gap. Should returning diaspora be paid the same as the local market, as expats or should they have their own package?
“If you don’t need a visa you shouldn’t expect to be treated like an expat”, argues Karl Craven of Spiral HR. However, diaspora professionals argue that their international education and work experience adds value compared to the local market, and they deserve internationally comparable salaries as a return on their investment.
Outside of South Africa, most African countries are still regarded as hardship postings justifying expat claims for more expensive packages adding to the frustration felt by many returnees with similar education and work experience as their Western counterparts. ReConnect Africa’s Frances Mensah Williams mentioned that 72% of skilled diaspora who responded to their survey have dual nationality, giving them more choices as to where they develop their careers.
“I took a pay cut moving back to South Africa after working for Saatchi & Saatchi in London, but I haven’t looked back since.” said Angel Jones from Homecoming Revolution, one of the attendees at the event. “We’ve found that successful returnees move home firstly to be closer to friends and family, second for a sense of belonging and only third for career. If salary is your biggest motivator, stay where you are.”
It’s important to note that this conversation speaks only to and about a very specific minority of the African diaspora, the Western educated African elite. Most of the African diaspora in the West are not heading up international corporations or MBA candidates in prestigious universities, but instead are looking after the elderly in care homes or cleaning offices. Moreover, the majority of African migrants don’t actually leave the continent, with over 60% of African migration being intra-Africa.
While foreign direct investment tends to be driven into non-labour intensive sectors, perhaps where highly skilled diaspora professionals can make the most impact is in SMEs. While the big multinationals and development finance institutions are willing and able to pay whatever it takes to secure the people they need, SMEs face the challenge of hiring someone below par but affordable, and risk commercial failure, or be priced out by the big corporations.
“The development of Africa is not going to happen based on global brands alone. The African development Bank estimates that SMEs contribute more than 45% to employment and 33% to GDP. In addition to attracting the diaspora to large multi-nationals or pan-African companies, we need to encourage them to take their skills into SMEs,” says Kevin Korgba, CEO of ETK Group which aims to achieve this with its executive work placement scheme.
While this group of Africa’s skilled diaspora may have a short term role in bridging the gap in management skills, companies playing the long game are rightly focusing on the development of local talent. Governments that have been focusing on infrastructure and transport bottlenecks to support investment into trade growth also need to invest similarly in their education infrastructure to have any chance at developing the talent to build its industries.