Sector Skills Plan
2014–2019
November 2013
Foreword
South Africa is in the third phase of its National Skills Development Strategy, known as NSDS III. MICT SETA is confident that it will continue to service its stakeholders as well as it has in the past. Notwithstanding the hurdles that must be cleared moving forward, the MICT SETA Sector Skills Plan (SSP) for 2014-2019 provides a clear path towards achieving the skills development objectives of the MICT sector. The need for technical, professional and management skills is clearly identified and MICT SETA will work together with employers, providers, government and the community to channel appropriate resources into creating the pool of talent that will meet the need. Integrating this skills plan into MICT SETA’s business plan and the business plan of its partners will provide the formula for success.
The combined efforts from all stakeholders to produce this document are gratefully acknowledged. The following deserves special mention:
· The Ministerial representatives on MICT SETA’s Board
· Industry, via representation on MICT SETA’s Board
· Organised Labour, through representation on MICT SETA’s Board
Our thanks go to all the stakeholders whose collective wisdom has been incorporated into this document. Sharing of knowledge is the catalyst for achieving South Africa’s skills development potential and economic growth.
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Oupa Mopaki
CEO: MICT SETA Chairperson: MICT SETA Board
Synopsis of the Sector Skills Plan
Introduction
The purpose of this synopsis is to provide an overview of the MICT sector in the context of skills development in South Africa. The information for developing this sector profile was gathered through desk research by reviewing data and information from several institutions including Statistics South Africa (Stats SA), the South African Revenue Service (SARS), the South African Reserve Bank (SARB) and the Bureau for Economic Research (BER). This data is complemented by workplace skills plans (WSPs) and annual training reports (ATRs) submitted by employers, as well as other desktop and online research reports that are sub-sector specific and those that provide key data about the South African economy. In addition, field research in the form of a survey and in-depth interviews were conducted amongst stakeholders in the sector to gain insights. Research findings were presented and discussed at validation focus groups.
Sector Profile and Analysis
The MICT sector is made up of five sub-sectors that are varied but interconnected and at the forefront of technology. The products and services provided in the sub-sectors are complementary to one another. The five sub-sectors are Advertising, Film and Electronic Media, Electronics, Information Technology and Telecommunications. There are over 19,500 employers in the sector of which about half are in the information technology sub-sector. About 95% of the employers are small and almost 40% are located in Gauteng. Levy-paying employers within the sector constitute only 20%. The MICT sector is spread across the manufacturing and services sectors of the economy.
The forecast for the sector is set to enjoy growth across all the five sub-sectors over the next few years. There are a number of drivers of change that will have an impact on the sector. Government programmes are likely to impact the sector’s telecommunications, film and electronic media, electronics and Information Technology sub-sectors. The Strategic Infrastructure Project (SIP-15) relating to the television digital migration programme will have to be supported increasingly from a skills development point of view, especially as there will be skills required for operating the back end platforms (electronic media) as well as for the manufacturing of set top boxes (electronics).
The film industry’s continued growth, buoyed by the incentives available from the DTI is likely to create further opportunities for employment and skills development. As the SKA programme and solar parks are being set up, there are electronic products to be manufactured, especially with the advent of the supplier development and localisation programmes that require that government spend and state owned enterprises purchase locally manufactured products. The international players in the ICT and electronics sub-sectors continue to see South Africa as a gateway into Africa and this has implications for skills development. With these sectors expected to continue to experience growth, both locally and in the African continent, the need for skills is likely to intensify.
Skills Demand, Supply and Scarcity
The demand for skills in the sector is varied. The workforce profile in the sector reflects an inverted pyramid, with more people employed in professional and technician occupational groups as compared to elementary occupations. The implication is that there is a need for more middle and high level skills within the sector. Critical skills are mainly required in technical areas to ensure continued relevance of practitioners’ abilities.
All universities in South Africa produce skills that are relevant in the five sub-sectors of MICT SETA. The public FET colleges tend to offer end-user type of computing skills and some generic business management and marketing programmes. There are 43 MICT SETA qualifications registered with the National Qualifications Framework of which 40% are at NQF level 4 and 37% at NQF level 5. Given the rapid technological advances being experienced in the sector, employers have to constantly train their workforce on the latest technologies, techniques and methods. The sub-sectors mainly utilise bespoke learning programmes developed by the organisations at the forefront of the particular technology. Thus there is a prevalence of vendor specific training programmes, especially in the IT and Telecommunications sub-sectors. Film & Electronic Media uses short courses to some extent. Some of the vendor programmes are highly credible amongst employers and are internationally recognised. This equips the learners with marketable skills.
The scarce skills that have been identified in the sector are mainly in three occupational groups: managers, professionals and technicians/associate professionals. The employers in the sector have identified weaknesses with graduates from the public higher education institutions. These graduates still have to be exposed to the workplace upon completion and have been found to still require a lot of capacitation..
As pressure mounts with the advent of the National Development Plan, there will be more expectations from the skills development system to work more efficiently in delivering skills that are required by the economy. In order to achieve the requisite 5.4% economic growth being cited in the NDP, pressure would be on SETAs, including MICT SETA to facilitate sound skills development.
The White Paper on Post Schooling is in the process of being finalised and together with the country’s Integrated Human Resource Development Plan and the Labour Market Intelligence Programme (both under development) would require the SETAs to conduct their business differently. As it stands, there is an expectation that SETAs should work closely with public FET colleges and HET institutions, providing accreditation for qualifications that have the potential to improve the employment capability of learners.
Sector Skills Development Strategy
The skills development strategy for the MICT sector is based on developing MICT SETA’s capability to understand the sector skills needs in order to ensure appropriate intervention to respond to such needs. The enhancement of internal skills demands research and labour market analysis as well as partnerships with research organisations and universities which are an important source in this regard.
The various stakeholders in the sector are an integral part of the skills development strategy. Government institutions will play an important part in regulatory activities as well as in providing experiential learning opportunities. Working with incubators is an important contributor to small business development and will continue to be an integral aspect of skills development. There will be concerted efforts to develop partnerships with agencies like the IDC, SEFA, SEDA, CSIR, NYDA and the TIA to mainstream the work of MICT SETA and to integrate the development of skills in the sector.
In order to ensure sufficient supply of scarce and critical skills to meet the demand in the sector, targeted interventions are necessary. These include bursaries for higher education programmes, work integrated learning and particularly upskilling unemployed graduates in areas of scarce skills as well as implementation of learnerships and internships. Skills programmes will continue to play an important role in the sector in terms of upskilling workers in the dynamic and fast changing technological environment.
For a sufficient supply of skills to be in place within the sector, partnerships with FET and HET institutions are of paramount importance. Focus in this regard would be on influencing changes in curriculum within the HET sector to respond to the complex needs of employers in the sector as well as supporting public FET colleges to enable them to provide training in MICT SETA qualifications that open up opportunities for employment in the sector. The private sector training providers remain an integral aspect of the MICT sector and efforts to enforce quality training will continue to be a key focal area.
Conclusion
The MICT sector is a dynamic sector with potential for further growth. Being at the forefront of technological changes, advancement is a crucial factor amongst employers and stakeholders in the sector. This, together with keeping up to date with international trends in advertising as well as in film and electronic media, has some serious skills development implications. As the use of technology and mechanisation becomes prevalent it too impacts skills development.
The B-BBEE imperatives of the country require that meaningful transformation take place in the economy and skills development is an important pillar in this regard. Mainstreaming of computer skills, especially end user computing will continue to be relevant, especially amongst people with low-level skills. As various programmes expressed in government policies and guidelines start to be implemented in the medium term, there will be a need to address the skills requirements that emerge from such programmes. This SSP endeavours to address all these issues and will be an important contributor towards achieving inclusive growth in the MICT sector.
Table of Contents
Foreword 2
Synopsis of the Sector Skills Plan 3
List of Tables 7
List of Figures 8
Acronyms 9
Chapter 1 Sector Profile 12
1.1 Introduction 12
1.2 The MICT sector industry landscape 12
1.3 Caveats 14
1.4 Size and shape of the five sub-sectors 15
1.5 Distribution of Employers by Province 16
1.6 Levy Paying Employers 16
1.7 The importance of the sector in relation to the wider economy 18
1.8 Employment in the MICT sector 24
1.9 Stakeholders in the MICT sector 35
Chapter 2 Sector Analysis 41
2.1 Introduction, scope and methodology 41
2.2 Economic performance and outlook 41
2.3 Factors impacting economic growth and development in the sector 56
2.4 Summary Scenario analysis 69
2.5 Conclusion and key strategic issues 70
Chapter 3 Demand and Supply of Skills 72
3.1 Introduction 72
3.2 Labour Demand 72
3.3 Scarce Skills demand 72
3.4 Approach to identifying scarce and critical skills 73
3.5 Overview of scarce skills 75
3.6 Overview of critical skills 79
Chapter 4 Supply of Skills 83
4.1 Introduction 83
4.2 Supply of Skills into the MICT Sector 83
4.3 Training Conducted in the Sector 89
4.4 Summary 90
Chapter 5 MICT Sector Strategy 91
5.1 SSP and the Strategic Plan and Annual Performance Plan 91
5.2 Strategic goals 92
5.3 Conclusion 100
Chapter 6 Monitoring and Evaluation Framework 101
References 117
List of Tables
Table 1: The MICT SETA SIC Code List 13
Table 2: Aggregated Standard Industry Classification for MICT Sector 14
Table 3: The MICT Sector Number of Employers per Sub Sector 15
Table 4: The MICT Sector Size of Employers per Sub Sector 15
Table 5: Provincial Spread of Employers 16
Table 6: Number of Levy-Contributing Companies 17
Table 7: Number of Companies in the MICT Sector by Size of Company 18
Table 9: Number of employers submitting WSPs 29
Table 10: Modelling output of the number of employees in the sector 29
Table 11: Number of Employees by OFO Sub Major and Sub-sector 33
Table 12: Major Group by Gender 34
Table 13: Major Group by Race 34
Table 14: Macroeconomic Forecast for the South African Economy 42
Table 15: Advertising in South Africa 44
Table 15: Forecast for South African Advertising 45
Table 16: Ten Largest Contributors to Global Advertising Spend Growth between 2010 and 2013 (US$ million, current prices) 45
Table 18: Forecast for South African Film and Electronic Media Market 46
Table 20: Electronics Sector in South Africa 49
Table 21: South Africa It Industry - Historical Data & Forecasts 51
Table 22: Information Technology Sector in South Africa 51
Table 23: Telecoms Sector - Mobile - Historical Data and Forecasts 52
Table 24: Fixed Line Telecommunications SWOT 53
Table 25: Mobile Telecommunications 54
Table 26: Estimation of Advertising Scarce Skills Need 75
Table 27: Estimation of Film and Electronic Media Scarce Skills Need 76
Table 28: Estimation of Electronics Scarce Skills Need 77
Table 29: Estimation of Information Technology Scarce Skills Need 77
Table 30: Estimation of Telecommunications Scarce Skills Need 79
Table 31: Estimation of Advertising Critical Skills 80
Table 32: Estimation of Film and Electronic Media Critical Skills 80
Table 33: Estimation of Electronics Critical Skills 80
Table 34: Estimation of Information Technology Critical Skills 81
Table 35: Estimation of Telecommunications Critical Skills 81
Table 36: Results of the National Senior Certificate 84
Table 37: The MICT SETA Qualifications, and Number of Accredited Training Providers 87
Table 38: The MICT SETA Qualifications and Number of Registered Assessors 88
Table 39: Training conducted based on ATR submissions 90
List of Figures
Figure 1: Levy paying employers in the MICT Sector 18
Figure 2: Regional Mobile Penetration (LHS), Key Telecoms Indicators (RHS), 2012 24
Figure 3: Employment Trends in Business Services 25
Figure 4: Employment trends in the economic sector consisting of the Film & Electronic Medis sub-sector 26
Figure 5: Employment trends in the economic sector consisting of the Electronics sub-sector 26
Figure 6: Employment Trends in the Communications Sector 27