The Covid-19 pandemic has wreaked havoc on South Africa’s already fragile economy. Add to that the arson and looting in KwaZulu-Natal and Gauteng, the cost of recovery and subsequent effect on the vaccination campaign, as well as Eskom’s intermittent load-shedding, and the picture is bleak.
So where to from here? One sector that is important to rebuilding South Africa’s economy is the technology industry. In a recent weekly message, President Cyril Rhamposa emphasised that South Africa’s recovery strategy will concentrate on new digital capabilities rather than a return to previous methods.
He said: “One of the concrete ways that we can do this is by harnessing the job-creating potential of the digital economy, whose growth has only been accelerated by the coronavirus pandemic.” He also cited a Ryan Strategic Advisory report that named South Africa the most favoured offshore customer experience (CX) delivery location out of 53 countries.
In addition to supporting South Africa’s economic success and prosperity, technology has the potential to establish itself as an emerging leader in innovative ways of thinking about energy, healthcare, education and many other fields.
I spoke to some industry experts about their perspectives on technology’s role in the South African economy.
SweepSouth is a company that’s using tech not only to grow a business but work towards socioeconomic change. Its platform connects domestic work professionals with work opportunities, bringing technology to an industry that has remained unchanged for decades.
Founders Aisha Pandor and her husband, Alen Ribic wanted to address unemployment in South Africa. SweepSouth, started in 2014, quickly became one of the fastest-growing tech startups in the country, helping users to book a home cleaner from their cell phone, tablet or computer within minutes, and enabling domestic workers to search for work opportunities.
“From the start, we wanted to use tech to build and scale a business that is also focused on positive social impact. We’ve always believed in the power of technology to really change the world at scale,” says Pandor.
Technology and its application within business is definitely the way of the future, she says. “Most businesses will need to readily embrace this fact if they’re to survive in the medium- to long-term. The pandemic has identified and accelerated numerous tech-enabled business opportunities, which will help to shape the ‘new normal’ in the world of work and lifestyle. E-commerce also has an increasingly large role to play.”
As one of only a few black female tech start-up chief executives in South Africa and internationally, Pandor believes in tech’s role in helping to further women in business, and improve their position to enable the economy.
“We have a relatively small number of women-run businesses, mentors and role models in South Africa, but technology is enabling women to connect and access information more easily, particularly in terms of business and entrepreneurial activity. Women have so many responsibilities to juggle, especially at home, so technology is allowing more women to work virtually without needing to be physically present in order to roll out products and services.”
Unemployment today sits at a staggering 74% for people aged 15 to 24. What is clear is that current measures to improve employment are not achieving the desired results. Which raises the question of whether we should prioritise digital transformation across sectors, as Mark Tomlinson, chief innovation officer of Hoorah Digital, suggests.
“An investment in digital capabilities can save money by helping to make various functions faster, cheaper and, in many instances, better. With government debt growing by the day, a reduction in spending needs to be a top government priority. Digital systems and processes, by their very nature, are geared for efficiency,” says Tomlinson.
He notes that: “At a time when the South African economy remains under severe pressure, digital services can help to stimulate growth, but the effect will only be seen once we collectively embrace a mindset that values the importance of digital skills in the 21st century.”
The chief executive of Digital Council Africa, Juanita Clark, highlighted that “the advent of technological innovation has for many years been the single biggest driver reshaping how we think about work, what constitutes work and the skills we will need to be productive contributors of work in the future”. Equipping the youth employment market with the digital skills of tomorrow is key to addressing our economic — and by implication, social — challenges.
A robust digital economy is central to economic growth and prosperity in 2021 and beyond. Ensuring people have the skills needed to thrive in this environment needs to be a key priority if South Africa is to have any chance of economic recovery.
Digital as an enabler
Christiaan Steyn, the head of MiWay Blink, believes that although technology might result in some unskilled, physical labour jobs becoming obsolete, if technology allows us to make education available to people at a lower cost, then we are equipping the next generation to do jobs that they would not have been able to do.
That there are fewer unskilled, physical labour jobs becomes a moot point. MiWay Blink itself is using smart technology to relook at a very traditional industry: insurance.
“I think technology and digital transformation in the broader sense is definitely an economic enabler. It makes goods and services more accessible and more affordable,” says Steyn. “There is a school of thought that argues that it will lead to job losses in a labour-intensive economy like South Africa’s but I would argue that it will simply change the type of jobs people do in the future. If technology enables economic growth, that leads to higher employment rates at a macro level but I do believe digital advances in the education sector are key.”
So the solution is clear, but there is a word of caution. South Africans must avoid simply copying models for innovation and digital transformation that have worked elsewhere.
Ndagi Job Goshi, general manager at Liferay Africa, believes that digital transformation needs to take local context into account. This requires adopting a mobile-first strategy that accommodates varying network levels and speeds. Additionally, it entails acting as a facilitator of certain fundamental services in certain regions.
“To some, those might seem like obstacles, but they’re really opportunities,” says Goshi. “If businesses invest in the development of their employees’ abilities, as well as the skills of young people who may work for them in the future, they will benefit their own bottom lines and the well-being of the communities in which they operate.”
Goshi says “This isn’t wishful thinking either. People are already taking steps in the right direction. As critical mass builds, South Africa will be well-placed to own and rewrite its narrative and take its place among the world’s technological and innovation leaders.”