Skills crisis could deter foreign investment
South Africa is in a skills crisis and if the situation is left unchecked the country will not attract more foreign direct investment, a report has found.
The sixth annual South African Employment Report, which was commissioned by the trade union, United Association of South Africa, and was released yesterday, said although the global community was experiencing a tertiary economy in some areas, local skills were 12 times behind.
The researcher and compiler of the report, economist Mike Schüssler, said although local labour faired well in primary education when compared to other emerging markets, the completion of secondary education was particularly problematic, especially with the global tertiary market trend.
Schüssler said what made the situation worse was that local government spent more on basic education, which accounted for 5,4percent of the gross domestic product, than the world average of gross domestic product education spend of 4,7 percent.
He said: "This is a clear lack of value for money, and means our education system leaves much to be desired."
Schüssler said SA would struggle to attract foreign investment if investors had an impression of an unsustainable and unskilled market that would not be able to build infrastructure.
"Where would you rather place your firm or business? We should not be surprised about the slow economic growth, and we must address the brain drain and skills shortage."