Anecdotal evidence suggests that some financial services companies in Johannesburg are offering higher wages and adding sweeteners to entice skilled workers back to the city and offset South Africa’s trend of out-migration in recent years.
The onset of the Covid pandemic in March 2020 led to an increase in emigration to coastal areas of South Africa, particularly Cape Town, and smaller coastal towns in the Western Cape – with many shoppers looking for better mode home life.
According to the Seeff Property Group, Mossel Bay, along with other coastal towns along the Garden Route such as Plettenberg Bay, George and Knysna, have emerged as some of the hotspots for outmigration.
In the face of the pandemic, it has become necessary – and viable – for many industries to allow their staff to work remotely from home. Professionals began to re-evaluate their lives, no longer being tied to their work city, spending less time commuting to work while devoting more time to their families and having a balanced lifestyle.
Flexible working was far from the norm and remote working was the exception for most financial institutions before Covid-19. And while many companies in the financial services sector, in particular, have said they plan to make remote work permanent for positions that allow it, some want their employees back in the office.
And with many skilled workers moving to the Western Cape, some employers in the financial services sector in Joburg are willing to pay well above the norm to bring some people back.
Data from CareerJunction shows that management/executive director positions already pay more in Gauteng than in the Western Cape.
Average salary offers for a management position:
- generalist: R87,457 – R117,422
- TOILET: R79,703 – R109,395
And the average salary offers for a skilled level senior executive per month are:
- general practitioner – R59,454 – R78,732
- TOILET – R46,439 – R55,394
Before the pandemic, salary offers were extremely competitive for finance professionals in Gauteng, compared to the Western Cape. Professionals working in Gauteng have been offered up to 23% more money than their counterparts in the Western Cape, according to data from CareerJunction.
A Microsoft survey of 31,102 workers worldwide between January and February found that about half of executives said their company already requires or plans to require employees to return to full-time in-person work. over the next year.
However, flexibility has become non-negotiable for many skilled workers, making negotiations tricky.
Advaita Naidoo, MD, Africa at Jack Hammer Global, an executive search firm, said that in the normal course of work at Jack Hammer, the company would expect between 10-15% of potential candidates to decline a job. opportunity depending on their location.
“However, as remote working has become so entrenched, this proportion has increased, in line with strong preferences to stay remote and not work in an office all the time – wherever that may be.”
“As a result, we see some companies trying to be creative with their compensation policies; in some cases, Johannesburg-based companies may offer higher salaries and additional incentives to attract Cape Town-based professionals.
According to Naidoo, some of the sweeteners include:
- Pay the difference in market value and the ultimate sale price of the Cape Town property to incentivize a quick move.
- Pay either the Cape Town property deposit installments until the new tenancy is able to sell, or the Joburg tenancy until permanent accommodation is found.
- Incorporate the cost of a weekly ride into the package, so new hires can have the best of both worlds.
A managing director of another executive search agency in Johannesburg said many companies offer sweeteners to strong talent. He said Joburg-based companies employ Cape Town-based candidates and then allow them to commute between the two cities and pay for the journey as well as stay in the city.
However, he pointed out that the trend is still towards emigration, with candidates returning to Joburg only if they fail to secure a suitable position.
“They migrate for a reason, but it’s not always viable when they want to move to another company in the town they now live in.”
Read: Offices in South Africa are facing a new working-from-home headache