Standard Bank yesterday became the latest corporate to announce its intention to retrench workers, with more than 500 jobs on the line as the group restructures its Information Technology (IT) division.
The bank said emerging technologies and increased demands from customers had resulted in the IT division reviewing its operating model to ensure that it was ready for the next wave of technological advancements.
The Bank said its new structure would see the creation of new capabilities and roles within Standard Bank’s IT division, in areas such as cloud engineering, data science, analytics and cybersecurity.
Ross Linstrom, the Standard Bank Spokesperson those who would be affected are permanent staff, the majority are in the executive and managerial bands.
“This process will create more than 180 new-generation IT positions within the bank. Regrettably, this will also result in the loss of a number of existing traditional IT positions,” Linstrom said.
“This process will result in 526 IT employees receiving Section 189 notices, which will commence the consultative process with the employees involved.”
Numerous job cuts seem to have arisen due to the declining economy.
South Africa’s power utility company, ESKOM has already announced plans to cut its workforce, the SABC has said it would have to let go of more than 1 000 workers for it to keep afloat.
Telkom’s subsidiary, BCX, last week also joined the bandwagon and warned that it would retrench about 700 employees following weak financial performance. The mining and manufacturing sectors have also been bleeding jobs at an alarming rate.
The unemployment rate in South Africa rate shot up to 27.5 percent in the third quarter of the year – the highest jobless rate since the third quarter of 2017.
Research conducted by the Bureau for Economic Research (BER) recently showed that the country missed out on a golden opportunity to reduce unemployment in the past eight years, with most of the economic stagnation self-inflicted.
BER found that gross domestic product underperformance relative to emerging market peers over the period hurt job prospects and tax collection.
BER said that, under different assumptions regarding post-crisis growth and the elasticity of employment, the economy could have created between 500 000 and 2.5 million more job opportunities over the eight-year period.
Meanwhile, PricewaterhouseCoopers (PwC) an audit firm company said yesterday that the R290 billion worth of investment pledges from local and international companies announced at the investment summit last month could yield nearly 1 million jobs by 2024.
The firm said its calculations estimate that this investment would add an estimated R338bn to South Africa’s gross domestic product over the 2019 to 2024 period, create or sustain an estimated 165 000 direct and indirect jobs on average per year and generate an estimated R59bn in additional government revenue.
Chief economist at PwC Lullu Krugel said the investment pledges would only translate into actual investments if a supportive business environment, policy certainty and political stability are in place.
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