As an increasing number of African enterprises look to adopt emerging technology, the market for developers has become tighter than ever, with companies scrambling to figure out where to find programming talent, and how best to attract and retain IT staff.
Nearly 80% of private enterprises report that lack of skilled technical staff undercuts revenue, according to PwC’s Africa Private Business Survey 2019, which polled decision-makers in 200 private businesses in nine key sub-Saharan countries. The skills gap appears to be hitting West Africa the hardest, with 82 percent of survey respondents reporting losses due to lack of in-house tech skills. In southern and East Africa, 78 percent of respondents reported losses due to insufficient in-house talent.
The shortage of talent is due in part to the intense interest in emerging technologies, and the fast ramp-up of new tech initiatives that businesses across the continent are attempting to do. Eighty-one percent of respondents to the PwC survey reported that they see digitalisation as “highly relevant” to their future, compared with 65% in the European Union.
African enterprises eye blockchain, AI, IoT
Emerging tech such as IoT, blockchain and AI, “are already on the radar for African businesses and the relevance of these technologies is rated much higher than in more economically developed EU economies,” PwC reports. “Three-quarter see IoT technologies as relevant for their business, and nearly 50% also rate blockchain highly. AI, 3D printing, and augmented reality (AR) are also considered relevant by around one-third of respondents.”
The talent supply in the labor market, however, is not keeping up.
“Even with unemployment hovering close to 10% in many countries (Kenya at 9.30% and Nigeria at 23.10%), a remarkable number of CIOs and CTOs have a hard time finding and retaining the talent necessary to not only extract value from investments in areas such as big data and enterprise mobility, but also undertake everyday IT operations with the required quality, security and efficiency,” said Adebayo Sanni, the managing director at Oracle Nigeria.
These executives also struggle to get the most out of their existing talent, Sanni said. The tight market for tech talent puts a variety of stresses on enterprises, industry insiders say.
“It is currently a candidate market. In our digitised age with strategic intent to optimise businesses via technology, there are more opportunities than there is actual talent,” says Kerry De Mendonca, the talent acquisition lead at software integrator Altron Karabina, a Gold Microsoft Partner based in South Africa with clients across the continent, in the Middle East and Europe. “The candidates in demand are typically your intermediate/specialist level, those who can contribute and add value immediately, at a reasonable cost. Because all companies typically look for this, and candidates have cottoned on to their ‘in demand’ status, we start to see pricing, benefit and culture wars among companies.”
Global companies draw top talent
On top of all this, African businesses are competing with international businesses that are scooping up top talent on the continent.
“It is very hard to find good tech talent that either has experience or potential and are willing to learn,” said Trent Odgers, the cloud and hosting manager at Veeam Software in South Africa. “One of the challenges is a lot of the top talent have immigrated to New Zealand, Australia, Canada, Ireland, etc.”
A variety of outsourcing organizations have sprung up in Africa – including Andela, Tunga and Devcenter — looking to place local talent in remote-worker tech positions for businesses internationally.
“There is a sizeable community of developer talent active on the African continent and in addition a huge pool of potential talent,” said Ernesto Spruyt, founder of Tunga. “If you know how to tap into that, you can get access to quality coders at very competitive prices.”
The biggest pools of talent on the continent are not necessarily found in the largest countries. For example, South Africa, with a population of 53 million, has more developers than any other country on the continent (12,130 Github users) compared to Ethiopia, which has a population of 104 million but only 872 Github users, according to a Tunga white paper, “Best African countries for sourcing software in 2019“. After South Africa, African countries with more than 5,000 Github users include, in descending order, Nigeria, Egypt and Kenya
As global companies offer remote work and relatively lucrative short-term gigs, African businesses are trying various approaches to attract talent.
Tactics for attracting developers
“Trending requirements are remote work, contract work, fun and flexible working environments, a people centric culture, competitive benefits, working with the latest technologies and on cutting edge projects,” Altron Karabina’s De Mendonca says. “With companies becoming more and more competitive in their attraction strategies, it is becoming increasingly difficult to retain tech talent.”
Some of the retention strategies De Mendonca cites include retainer bonuses and engagement initiatives. “Looking at alternative talent pools such as graduates or entry level candidates is also becoming more popular as this allows one to grow with a business, with greater loyalty and eagerness to learn and deliver,” De Mendoca says. “There are also macro economic factors that lead to an increase in emigration of tech talent; the only retention option for these population groups is to offer remote work internationally.”
Large vendors, meanwhile, can make efforts to provide relevant skills by working with local partners, Oracle’s Sanni says.
“Cloud-led digital transformation is on the rise across Africa, and with this acceleration comes the demand for improved services, skills and solutions from local partners,” Sanni says, citing Oracle Nigeria’s recent opening of a cloud centre in Lagos aimed at driving digital skills development across local partner networks.
Opened in collaboration with a value-added distributor operating in sub-Saharan Africa, Redington, the cloud centre will allow Oracle partners to “focus on continuous skills development and education of their employees, empowering the Nigerian IT ecosystem to grow, while better servicing customers who are embarking on their cloud journey,” Sanni says.
Tech hubs help develop local skills
Tech hubs tend to rely heavily on local talent, and are also “a catalyzer for local software development skills,” notes the Tunga white paper. “The number of tech hubs in a country and its growth rate are therefore a strong indicator for the future potential of the local developer community.” By the end of 2017, Africa had 442 tech hubs compared to 314 in mid-2016, according to the latest available figures examined by Tunga. South Africa, Nigeria and Egypt lead the list, according to the report. Nigeria more than doubled the amount of tech hubs during the period, with Ghana, Uganda and Zimbabwe also showing strong growth.
Ultimately, both private enterprises and government initiatives will be needed to instill a sense in young people that tech is where the action is, says Veeam’s Odgers. “There are quite a few youth development programs in the partner and vendor ecosystem, but more can still be done to attract and enable the youth towards tech driven organisations,” Odgers says. “The emerging workforce want to see the value of being at the cutting edge of how the future is being shaped.”
Despite the tight tech talent market, there are encouraging signs. South Africa, for example, has made tech education a national priority, with the government rolling out a programme to introduce subjects such as coding and data analytics at a primary school level. In addition, as PwC notes, despite structural problems such as poor infrastructure throughout the continent, “Africa’s economic performance is expected to improve this year and next, with the World Bank predicting the continent growing by 2.8% in 2019, from an estimated 2.3% in 2018.”
The resiliency of African businesses in the face of structural issues and the increasing awareness of the need for tech training encourages some industry insiders.
“I think we’re barely scratching the surface of Africa’s potential,” says Tunga’s Spruyt”. There is an enormous and growing pool of young talent that – when properly educated – can become a formidable tech workforce. I think it’s just a matter of time.”