The global business services (GBS) sector − South Africa’s green shoot for the unemployment crisis − continues its upward trajectory, creating over 14 000 new jobs in the first nine months of 2024.
Further, the sector contributed just under R13.6 billion in export revenue during the same period, according to industry body Business Process Enabling South Africa (BPESA).
Sometimes referred to as the business process outsourcing (BPO) sector, the GBS sector is targeting500 000 new jobs by 2030, and the latest figures bode well for the targets, says BPESA.
The job target is part of the GBS sector master plan, an initiative spearheaded by the Department of Trade, Industry and Competition (DTIC), BPESAand Harambee Youth Employment Accelerator.
As the sector continues to boom, youth and women are said to take the lead when it comes to the composition of SA’s GBS sector.
Out of the more than 14 000 new jobs created in the period under review, 12 564 of those have been taken up by the country’s youth, reveals BPESA, unveiling the latest figures at its annual general meeting this week.
BPESA chairperson Zain Patel says that in the last year, 10 new international BPO operators had chosen to invest in South Africa.
“This reaffirms SA’s position as the third most attractive offshoring destination in the world for prominent international firms in the telco, retail, healthcare, technology and financial services sectors,” he comments.
BPESA attributes these achievements to numerous market activities tailored to key international source markets, such as the UK and the US. It notes that 51.2% of globally-focused workers service the UK market, while 30.4% service the US market.
“Since the first quarter of 2022, which is when the sector master plan was officially launched, we have managed to attract 30 international investors to our shores, of which 22 converted to invest in SA,” adds BPESA CEO Reshni Singh.
“They include 12 BPO operators and 10 end-user clients. We expect they will create between 13 000 and 17 000 new jobs in the next 18 to 24 months, which is a fantastic success story for the sector and the country.”
According to Singh, significant strides are being made towards advancing SA’s demand-side commitment goals under the GBS sector master plan.
As a result, SA’s efforts to strengthen its global competitiveness in the GBS sector have yielded some positive shifts.
“The DTIC has played a pivotal role in supporting the industry to remain globally cost-competitive by undertaking a review of the national GBS incentive programme, as well as a refresh of SA’s value proposition, which has been enhanced with specific strategies for source markets like the UK and US,” she states.
“On average, SA is significantly more cost-effective than markets such as Poland and Malaysia. Initiatives such as the GBS incentives and cost management strategies aimed at attracting and retaining international clients have also made the country comparable with locations such as Jamaica, Egypt and the Philippines, which are our main competitors.”
Singh points out the industry’s success is underpinned by a public-private partnership between industry, government and social partners that were key signatories to the GBS master plan.
“The dynamic landscape of global business services is constantly evolving, with factors like AI and changing market conditions bringing both challenges and opportunities. As BPESA, our goal is to ensure SA not only attracts but also retains international investors.
“We are dedicated to building a sustainable ecosystem that empowers local communities and enhances our global competitiveness. Under the guidance of the DTIC and partnership with Harambee Youth Employment Accelerator, we are fostering a promising future, positioning SA as a powerhouse in global business services,” she concludes.
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