Paying for skill

first_imgThe survey showed that call-centre managers in Gauteng,South Africa’s economic heartland, are paid up to US$40,000 a year, as opposedto about US$35,000 in Cape Town. These figures do not, however, includebenefits, such as travel allowances, medical insurance, group life cover andpension schemes, cell phone allowances, bonuses, profit share, staff loans anddiscounts, bursaries for further study and 13th cheques (an extra month’sbonus). All these benefits are fairly standard in South Africa, although thecombination varies depending on the size of the company, the seniority of theposition and the scarcity of the skills. The HR director of a company which at one time was planningto expand from South Africa into Zimbabwe, pointed out that they were expectingto give their staff in Zimbabwe monthly increases to keep pace with the rapidlyspiralling inflation rate just so that they could maintain a particularstandard of living. The company has since put its plans on ice. Salary increases granted to business executives around theworld always beat inflation, says Jim Steer, director at Deloitte & ToucheHuman Capital Corporation (HCC). He made this comment after extracting thefigures relating to executive pay increases from HCC’s international associateWatson Wyatt’s latest Global Executive Remuneration Survey, which examinedexecutive pay in 50 different countries. A salary survey within the call-centre industry in SouthAfrica, conducted by QuestConnect in Johannesburg, revealed that there was aceiling to how much an employer was prepared to pay and that remuneration wasnot the only reason for staff turnover within call centres. Ian Holmes, HR director of Johannesburg-based constructioncompany Murray and Roberts Contractors International, which has constructionprojects in Africa and the Middle East, says when it comes to pay, companiesget what they pay for. He points out that expats in Dubai, for example, arepaid at three very distinct levels. “Thanks to technology, executive skills are readilytransportable over geographic borders. If executives in one country feel thattheir standard of living is being compromised by high inflation, it isrelatively simple for them to emigrate,” he says. Previous Article Next Article In Zimbabwe, where buying power has been steadily decliningover the past few years, a survey has shown that, while government employeesare paid salaries that have increased their buying power, those in the privatesector are getting poorer and poorer. Any foreign national who is expected towork in Zimbabwe will therefore have to be paid according to internationalnorms, regardless of what happens to the Zimbabwean economy. Steer says this is as true in developed countries withbooming economies and low or even negative rates of inflation as it is inAfrican or Middle East countries with contracting economies or high levels ofinflation. And he believes that executive remuneration trends have as much todo with improvements in productivity and perceived price increases as they dowith a global shortage of talented executives. Steer concedes that in countries with a more chronic skillsshortage, there is more pressure on companies to find ways to reward executiveloyalty, although he is quick to point out that remuneration is only one factorin retaining managerial talent. There are a number of other factors outside thecontrol of business that can prompt the emigration of skills. In South Africa,for example, emigration of skilled individuals is exacerbated by factors suchas the crime rate in the country. Paying for skillOn 1 Feb 2001 in Personnel Todaycenter_img Because IT skills continue to be in short supply throughoutAfrica, the pay packages required to attract these skills have to be big enoughfor an IT specialist to earn substantially more than he or she could earn in adeveloped country. Smaller, local companies are therefore not usually in aposition to employ these people. They are usually employed by the largemultinationals who have a presence at local level and who are able to pay thesalaries and benefits that make living and working in the particular countryworthwhile, for a period, at least. Salary trends in Africa and the Middle East are largelyinfluenced by the need to attract or retain people with the required skills,says Alan Hosking “The highest-paid are the experts from Europe, who arecurrently pricing themselves out of the range. Below them come the SouthAfricans, who are prepared to work for far less money than the British and arestill sought after in upper management.” The third level, says Holmes, includeslargely Asian nationals. “The Koreans in Dubai are undercutting almosteveryone else, while the expats from India are prepared to work for just aboutanything. You can get a quantity surveyor from India for US$4,000 or even less,but the onus is on the employer to ensure that the person is qualified to dothe job.” While Africa and the Middle East differ dramatically in manyways, they share a number of similarities. With the exception of a fewcountries, both regions are known for ongoing conflicts or a serious risk offuture conflict. This makes a huge difference to their attractiveness as aplace of work for foreign nationals, a factor which further adds to theaffected countries’ woes, as many of them are very dependent on foreign skills.The political and/or economic uncertainty of many African and Middle Eastcountries therefore plays a large role in the amounts and the manner in whichpeople are paid to work in such countries. The difference in pay between Gauteng and the rest of SouthAfrica reflects a general trend in the country. Most companies pay highersalaries, particularly in the Johannesburg area, where the cost of living isnoticeably higher than that of the rest of the country. www.watsonwyatt.com Comments are closed. In the Middle East, which dominates the export of worldenergy, the average per capita income is just above US$2,000 compared withabout US$24,000 for high-income states. Yet foreign nationals working in theMiddle East and Africa expect to be paid the same salary packages they receivein their home countries, and then a good deal extra for the inconvenience (anddanger, in many cases) they may have to face. Related posts:No related photos.last_img

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