PART 1: The Environment for human resources
Chapter 1: The Foundation and challenges of human resource
management
1.1 People Practices in SA
(Background information)
According to the 2017 Africa Competitiveness Report, of the 138 countries participating in
the project worldwide, South Africa obtained an overall rating of 47 out of 1382 which
means that we have moved up from 56th out of 144 countries in the 2015 report. The
countries were evaluated on 12 different pillars (see Table 1.1). This can be regarded as a
good rating because South Africa remains highly ranked compared to other countries in sub-
Saharan Africa. In terms of technological readiness, the country received a rating of 49
(higher than 2015). It continues to receive excellent results in complex areas such as the
availability of the latest technology (44th), capacity for innovation (25th), financial market
development (11th dropping from 7th) and business sophistication (30th, previously 31st).
However, what is a serious cause for concern and something that could impact negatively in
future on these favourable ratings is our rating on the labour market pillar (the 7th pillar). It
is particularly disturbing that our ratings here have been very low over the last few years
with a recent improvement. Our rating as a country on cooperation in labour–employer
relations shows us in 113th position, while in previous reports we were at 113th out of 144.
For flexibility of wage determination, we are 139th; for hiring and firing practices, 135th; for
pay and productivity, 98th. Please note that certain HR components, such as training of staff
(the 5th pillar), did receive a very positive rating (77th, an improvement from 86th).
However, the people component needs to be managed as one integrated whole to enable
an organisation to obtain and maintain its competitive advantage. From Table 1.1, it is clear
that South Africa still has much to do in this area. All HR practices need to be in sync.
,Table: South Africa: The Global Competitiveness Index in detail:
,
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