International financial services provider Allianz has released its Global Risk Barometer for 2022, surveying 2,650 risk experts in 89 countries and territories about the biggest risks their businesses will face in the coming year.
While persistent problems such as ransomware attacks, data breaches or major IT failures continue to threaten companies, for the first time since the start of the investigation, the shortage of skilled labor has been classified as a major risk globally.
Notably, skills shortages have been named the eighth biggest risk in South Africa today – with companies warning that it has rarely been more difficult to attract and retain workers.
“As economies reopen around the world after lockdowns, reports of employers being unable to find the workers they need have become increasingly common,” Allianz said.
“Covid-19 has been extremely disruptive to the labor market, exacerbating existing issues caused by the retirement of older employees and the already changing needs and expectations of potential employees, while bringing new challenges such as workers skilled workers who want flexibility in when and where they work and who are willing to leave existing jobs to achieve this.
In December 2020, the global talent shortage stood at 40 million skilled workers worldwide. By 2030, Global Consulting Firm Korn ferry estimates this could reach more than 85 million people, resulting in billions of dollars in lost economic opportunity for businesses, Allianz said.
Knowledge-intensive industries such as financial services, technology, media, telecommunications and manufacturing are among the industries expected to be hit the hardest, while survey respondents ranked talent shortages among the top five risks in the following areas:
- Real estate;
- Public Service;
- Health care;
This corresponds to the data published by Old mutual in November, which shows that South Africa faces a ‘ticking time bomb’ as more skilled workers leave their jobs in a ‘big quit’ and companies are forced to do faced with an increasingly high churn rate.
Remchannel, Old Mutual’s rewards management platform, said increased staff turnover and accrued leave costs could be a ticking time bomb for businesses nationwide.
Speaking in a recent webinar, Rene Richter, CEO of Remchannel, said employee turnover has increased by 16% across all industries.
Nearly 69% of compensation survey participants – namely HR and compensation professionals – indicated that they had difficulty attracting new talent or retaining existing talent.
“While there are various reasons for labor turnover such as retirement, termination of contracts and downsizing, the October 2021 wage and salary development survey revealed that the top reason an employee quit between April and October 2021 was due to resignation (60%), suggesting aspects of the “Great Resignation” trend, which began in the United States, where millions of people, from frontline workers to senior executives, voluntarily ended their jobs,” Richter said.
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