Posted: 2005-06-07 23:57 Can SA pull together for 100,000 new jobs?  Presenter: Lindsay Williams Guest(s): Brian Whittaker South Africa has a window of opportunity in the next five years to create thousands of new jobs by tapping into the global trend of outsourcing - if decisive action is taken soon. With Michael Spicer from the SA Foundation, and Business Trust chief executive Brian Whittaker LINDSAY WILLIAMS: That’s according to a study by McKinsey and Co, commissioned by the City of Johannesburg in partnership with the Comark Trust and the South Africa Foundation. What sort of job numbers are we talking about here? MICHAEL SPICER: Potentially I think on a reasonable assessment 100,000 jobs - 25,000 direct and 75,000 indirect. LINDSAY WILLIAMS: That’s a substantial amount of jobs in a country that really is battling to create the jobs that we should be - given our very poor employment record over the last few years. "Business processes", "outsourcing" and "off-shoring" sounds a little bit like jargon - can you put it into basic English for us? MICHAEL SPICER: It’s very simple - call centres. LINDSAY WILLIAMS: I saw an article in the Financial Times recently - showing the outsourcing of a Dutch call centre using Afrikaans. What are we talking about here - basic English? What’s the major language? MICHAEL SPICER: The big opportunity is really with primarily English speaking countries - the US and the UK - although there are some European opportunities as well. It’s mainly in the banking and insurance sector - but not strictly limited to that. There are also a number of IT and telecommunications companies that could outsource many of their back office functions to South Africa. LINDSAY WILLIAMS: Countries like India, China, and the Philippines - we’ve seen a lot about them leading the way in outsourcing. How have they done it? MICHAEL SPICER: I think they’ve done it by having high-level champions in the public and private sectors - so very focused co-ordinated activity, strong industry representative bodies, driving hard in terms of providing the necessary training, the necessary incentives, and the necessary regulations, and indeed deregulations! LINDSAY WILLIAMS: You talk about four to five years and 100,000 jobs - how far are we away from achieving that, in terms of the development that has occurred over the last couple of years? MICHAEL SPICER: I think one of the reasons that we commissioned this research was we felt although we were beginning to make some halting progress - it was far too slow for an industry moving at internet speed. We really needed to have the facts of the international experience - the size of the opportunity - and then bring to bear some very high level private sector leadership skills to co-ordinate the activity with government. I’m pleased to say since the report was commissioned we’ve made very good progress - I think Brian Whittaker will tell you a little bit about that. The SA Foundation used its muscle to get this issue on the table at the last big business working group discussion with the cabinet - out of that emerged a partnership, and some pretty focused activity - so I’m cautiously optimistic. LINDSAY WILLIAMS: Brian, what sort of progress are we making, and how far are we away from that goal of 100,000 new jobs? BRIAN WHITTAKER: We think we are probably about four years away from achieving that - if business and government move in sync to do the things that need to be done. The research shows that there are really five things that you’ve got to do to capitalise on this opportunity. LINDSAY WILLIAMS: What are those five? BRIAN WHITTAKER: You have to market yourself effectively to those parts of the world - especially looking at places like the UK that are outsourcing this kind of work - and you have to get them to pick you over competitors. In order to pull that off you have to show that you have the right conditions in the country to respond - particularly the right skills base. Specific work needs to be done to build that - although we start from a good position because we have people with a good English background. That provides an enormous opportunity there. You also have to have the right regulations and incentives in place - to attract them. That’s the third thing you need. You need to assure quality over the long-term, and the fifth thing you need an organisational arrangement that will drive this systematically over the long-term. In order to get those five things in place we think a partnership is needed between business and government. LINDSAY WILLIAMS: To put it into perspective, a lot of fuss is being made about the billions in foreign exchange coming into the country with the Barclays deal - but that’s not going to create 100,000 jobs. In terms of money 100,000 jobs will also mean foreign exchange coming in surely? BRIAN WHITTAKER: Yes, it will - as a result of those offshore operators that bring their operations here. We haven’t quantified those numbers at the present time - but we’re sure that there is a substantial amount of VAT that will be associated with this opportunity. I think the really encouraging thing for the Business Trust is that this not only helps create jobs, but can create jobs in communities where they are most needed - call centres are not location-sensitive, so there are many, many benefits here. The trick is that we all have to pull together over the next five years. Comments Related to this transcript: Comment on this transcript... Name : Email : Comments :