In his February 2019 Budget Speech, Minister Tito Mboweni made specific reference to stagnant job growth in the private sector and labour market forces that “obstruct easy entry into employment, particularly for young people.” (Fin 24, 20 Feb 2019). The South African Graduate Employer Association’s (SAGEA) 2019 Employer Benchmarking research among 94 leading graduate employers in South Africa reveals that many organisations are taking a LONGER-TERM view on the future and remain committed to young talent development. The study shows that we will see growth in graduate vacancies in six out of the nine sectors that are tracked. Whilst the projected growth of 5.3% is lower than in previous years it is, nevertheless, good news for graduates as we have witnessed year-on-year growth in vacancies since the study’s inception in 2005.
Employers state that their main reason for focusing on young talent is to build skills for the future and develop a pipeline of leaders who can guide the organisation forward. Stiff competition for the very best graduates means that growing young talent comes at a cost and employers expend a great deal of effort and investment articulating their employer brand and opportunities to students using a combination of media and promotions. The success of these endeavours is evident in the huge growth experienced in application volumes which went from an average of 59 applications per vacancy in 2018 to 92 in 2019. Consequently, talent team resources are often stretched – but it is those employers that are most innovative in managing volumes, engaging with students and striking the right balance between high tech and high touch that will secure the best talent going forward.
The Auditing and Professional Services firms dominate when it comes to filling graduate vacancies, accounting for more than two-fifths of all graduate opportunities on offer. This is closely followed by the Financial Services sector. The Consulting and Retail sectors fall in the middle with the smallest number of vacancies being available in Engineering, IT and the Chemical, Mining and Energy sectors. Two thirds of employers were able to fill their graduate vacancies for 2019 with some shortfalls experienced in Asset Management, Merchandising and Supply Chain and Logistics. Those employers who were not able to fill graduate vacancies attributed the causes to either a late change in the business requirements, a shortage of applicants with the requisite skills or the highly competitive nature of young talent attraction.
More encouraging news for graduates starting work in 2020 is that starting salaries are set to increase in six out of 9 sectors. Most employers will be increasing salaries in line with inflation, with the projected median starting salary for graduates at R210 000. Those starting work in investments, actuaries, geologists, retail banking, mining engineering and legal positions can expect to command salaries in excess of R350 000 per annum.
When asked about their key areas of focus in young talent attraction, employers spoke of their commitment to increase diversity with special efforts on gender, equity and social mobility. Wellness and employee mental health are also top-of-mind for employers. Employers are further engaged in finding innovative ways to reduce the costs of talent attraction, selection and assessment whilst maintaining their position as employers of choice.
To find out more about the SAGEA Employer Benchmark study, please read our press release by clicking here. Our next Talent Talks feature will provide you with insights from our 2019 Candidate Insights study and will profile some of the typical characteristics and job-seeking behaviours of over 2000 graduates, many of whom received two or more employment offers, who joined one of the leading and most respected graduate programmes in 2019.