Africa tech skills scarcity impacting digital transformation efforts 

By Alexander Chiejina

Africa’s tech skills scarcity is negatively impacting Africa’s digital transformation efforts, according to a new SAP report titled, “Africa’s Tech Skills Scarcity Revealed”.

According to the report, four in five organisations surveyed reported some negative effect from a lack of tech skills, with 41 percent reporting that employees are leaving due to the pressures they experience as a result of understaffing. Other consequences include not being able to meet client needs (reported by 46%), reduced capacity for innovation (53%), and losing customers to competitors (60%).

Nearly all organisations expected to experience a tech skill-related challenge in 2023. More than two-thirds (69%) also said they expect to experience a skills gap in the year ahead. According to the data, the top skills challenge for African organisations is attracting skilled new recruits, although in South Africa the retention of skilled employees narrowly edged out attracting skills as the top challenge.

The report noted that Nigerian companies are experiencing the impact of a lack of tech skills to a greater extent that they suffered a negative impact due to a lack of tech skills, compared to 60 percent in Kenya and 78 percent in South Africa.

Cathy Smith, managing director at SAP Africa, said that there is an urgent need to invest in skills development and training to ensure Africa can capitalise on its youth dividend.

“More than half of the world’s population growth between now and 2050 will take place in Africa, where 1.3 billion people are expected to be born by mid-century. With the correct investment in skills development, Africa’s economy could transition away from its reliance on natural resources to build the world’s future tech workforce, bringing untold economic and social benefit to the continent and its citizens. However, as our research reveals, African organisations still face some difficulties with attracting, retaining and upskilling suitably skilled tech workers,” Smith said.

In response to the ongoing tech skills challenges, organisations are taking bold steps to ensure they have access to the correct tech skills.

Forty-one percent said that upskilling of existing employees would be a top priority in 2023, while 40 percent said the same about reskilling employees.

Smith disclosed that companies are also adopting technology tools and flexible work practices to ensure they can attract, retain and mobilise the correct mix of tech skills.

“Seven in ten organisations currently use a human capital management or employee experience tool, while nearly half (45%) of companies were open to remote work, although most want employees to be in the office at least some of the time. This new workplace dynamic will require leaders to co-create new models for work, with constant collaboration with employees to ensure alignment with company objectives and culture,” the report stated.

The “Africa’s Tech Skills Scarcity Revealed” report further found that the most in-demand skills include cybersecurity and data analytics (63%), developer and industry skills (49%), and digital transformation skills (48%). More than two-thirds (69%) cited technical skills as an important attribute when recruiting, while 66% said industry-specific skills were important to them.

The change management skills so essential to successful digital transformation were not highly prized among the companies surveyed, revealing an opportunity for smarter investment in specific skills to improve the outcomes of initiatives. Only 18 percent of companies cited change management as an in-demand skill.

“Studies have shown that fewer than a third of digital transformation projects succeed, partly due to the fact that only 34 percent of change management projects are clear successes,” says Smith, adding that, “For a continent that is rapidly transforming through the accelerated adoption of digital technologies, ensuring effective change management could greatly improve outcomes and equip organisations with new capabilities to drive growth and innovation.”

The top tech skills challenge for African organisations is attracting sufficiently-skilled new recruits, except in South Africa. Organisations in Kenya and Nigeria cite attracting skilled new recruits as their top tech skills challenge in 2023, but in South Africa the top challenge is retaining skilled tech workers.

Digital transformation skills were cited by 70 percent of South African companies as an in-demand skill, compared to only 33 percent of organisations in Kenya and Nigeria.