South Africa urged to free up labor market
The sooner you outsource, the sooner you will earn revenues. This same principle may well apply to an entire region, where the sooner the region offers outsourcing services, the sooner it will prosper.
Analyts are concerned that strict, "inflexible" regulations in South Africa prevent resources from being maximized, and keep the region from becoming more globally competitive.
"Poor countries that desperately need new enterprises and jobs risk falling even further behind rich ones who are simplifying regulation and making their investment climates more business friendly," said Michael Klein, World Bank/IFC (International Finance Corporation) vice-president for private sector development and the IFC’s chief economist.
Botswana, the best-performing economy on the continent this year, was the only African country among the top 20 economies in terms of ease of doing business due to more flexible regulations. African countries reformed the least of all regions and had the most regulatory obstacles to doing business, followed by Latin American countries...
South Africa's unemployment rate currently hovers at 40%.
Some, however, are more concerned that there is an actual skills shortage in the region. The lack of jobs takes a backseat to the notion that few South Africans are adequately trained for the jobs.
Meanwhile, speaking on Moneyweb’s Power Hour radio programme on Thursday, deputy chairman of the SA Institute of International Affairs and President Thabo Mbeki’s brother Moeletsi Mbeki said that the dire shortage of skilled workers in South Africa needs to be addressed. "I think what our country needs desperately is new jobs to absorb the large number of people who are unemployed, who are living in huge poverty."
Mbeki believes greater priority should be placed on skills training, than on black economic empowerment.
The outsourcing boom affects not just first-world nations concerned with jobs being lost. It also economically transforms third-world nations that take advantage of the trend.
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