Almost half of employees in the European and South African regions believe their current employer is not effectively making use of the latest technology advances, according to findings from the Dell and Intel Future Workforce Study, which identifies the global technology trends shaping the modern workplace.
The 2016 Future Workforce Study, conducted by research firm PSB, polled nearly 4,000 full-time employees from small, medium and large businesses in 10 countries. Of those polled in the UK, Germany, France and South Africa, many do not believe that they will be working in a smart office within the next five years and perceived their current workplace technology as lagging behind personal devices on innovation.
With the research showing that the influx of new technology is having a significant impact on what workers expect from their employer, workplaces which don’t enact these new advances may be left behind. Technology has already had a huge impact on how we interact in the workplace, with, many employees – most notably a staggering 67% of millennials in South Africa – believing that face-to-face meetings will become obsolete.
Innovative technologies, such as the Internet of Things (IoT) and virtual reality (VR), could also become vital to the workplace of the near future, affecting how we collaborate and work more efficiently.
“Today’s workforce has a growing expectation that their employers integrate the latest technologies seamlessly and securely into their working lives,” said Chris Buchanan, Client Solutions Director, Dell South Africa.
“Employees have seen first-hand the ways new technologies can help them do their jobs better, and are hungry to use the latest advancements to be more productive. While this may seem daunting to many employers, it’s a business-critical opportunity for companies to be at the forefront of the future workplace and enable the future workforce.”
The Dell and Intel Future Workforce Study highlights how much the new generations of workers consider technology a key factor in career selection and satisfaction. As much as in the past the work environment was considered key to employee happiness and a factor in productivity, so today technology and work flexibility using such technology are now critical considerations,” said Steven Ambrose, CEO of Strategy Worx.
“The quality and sophistication of consumer-focused technology are at such an advanced state and have become so ubiquitous for most users; companies now have no choice but to offer the same or better options to their workforce as a matter of course. Companies that understand this trend and respond to it will hire, retain talent, and succeed, where those that don’t will fade and fail.”
Inflation falls back into SARB target range
Statistics South Africa (StatsSA) reported yesterday, that headline inflation decreased from 6% year-on-year (y-o-y) in July to 5.9% y-o-y during August.
The latest y-o-y figure (calculating the change over a 12-month period) was below market expectations of 6% y-o-y and the first reading to fall within the South African Reserve Bank’s (SARB) target range of 3% – 6% since December 2015. This positive development was supported by the consumer price index (CPI) declining by 0.1% month-on-month (m-o-m) between July and August.
Petrol was 7.6% m-o-m (99c/litre) cheaper as a result of a stronger rand exchange rate and lower international fuel prices. In addition, price indicators for medical products and vegetables were on average 0.5% m-o-m lower last month. The benchmark food basket cost 0.9% m-o-m more in August.
StatsSA recorded a 1.5% m-o-m increase in processed food prices, including a 2% m-o-m rise in the price of bread and cereals. This translated into this basket of staple food items costing 11.3% y-o-y more during the month. Overall, food cost on average 11.6% y-o-y more last month compared to a rate of just 4.4% y-o-y recorded in August 2015.
The Food and Agricultural Organisation (FAO) of the United Nations commented in a report released on September 12, that South Africa’s worst drought in 25 years has left 14.3 million (one in four) of its citizens vulnerable to food insecurity. On a positive note, the National Agricultural Marketing Council (NAMC) said in a report published on August 31 that “food inflation is losing momentum” and could possibly return to single digits (i.e. below 10% y-o-y) in coming months.
The SARB MPC will take this information into account during its current deliberations over interest rates. Policymakers are in a three-day meeting and will on Thursday afternoon reveal their inflation forecasts and interest rate stance. A recent Bloomberg survey amongst 27 local economists indicates expectations that the SARB will keep interest rates unchanged this week. It is also likely that the MPC will lower their near-term inflation forecasts as a result of the latest StatsSA data.
SARB Governor, Lesetja Kganyago said in a speech on September 7 that the central bank “would like to respond to slow and below-trend [economic] growth with lower interest rates”. However, he indicated that monetary policy decisions necessarily involve trade-offs, and that the MPC “has opted for trade-offs that serve [its] inflation-targeting mandate.” Indeed, price stability remains the primary mandate of the SARB despite weakness in the local economy.
Ratings downgrade could mean ‘riskier’ bonds for investors
South Africans have been arguably living with a sword over their heads since the beginning of 2016: the imminent downgrade of the country’s sovereign credit rating to non-investment grade levels by global ratings agencies.
Andrew Morton, Head of Advice at FNB Financial Advisory says most local investors and prudent advisors have already factored the potential occurrence into their investment planning, by ensuring that diversification is in place, including offshore exposure.
“There are numerous potential consequences of a ratings downgrade including the fact that South African bonds would be deemed ‘riskier’- meaning investors will require higher yields on their investments. Investors with existing exposure to the bond market would see their capital values negatively impacted.”
“Stock Market investors would also take a hit. Looking more broadly, the economy would inevitably take a knock, credit would be harder to come by, the banks would tighten the reins on lending, and investment and business development would be curtailed as a result. The rand would weaken, driving inflation and taxes higher,” he adds.
An important starting point for investors concerned about the knock-on effect to their portfolios and wealth legacy is the fact that those with existing investments actually stand to benefit in terms of higher interest rates. This benefit is likely to attract bolder, yield-seeking international investors, eager to take advantage of attractive interest rates, despite the perception of ‘riskiness’.
“The reality is South Africans will still be living, working and paying taxes in this economy. If you live in South Africa you will always be invested here as long as you have a house, pension fund, savings, investments and school-going children. However, what you can do is insulate yourself somewhat from the in-country impact of a downgrade by ensuring you have adequate exposure to other markets. Whether a rating downgrade happens or not, this approach will inevitably leave a savvy investor better off and more able to weather other global contagions,” says Morton.