Advertising executive Penny Holt loves her native South Africa but power cuts, a murky political climate and widespread violent crime made her think about leaving the nation she once viewed as a beacon of hope.
A robbery at her office was the last straw.
”There’s a brutality, an anger that worries me,” said the 32-year-old executive at Saatchi & Saatchi as she finished packing up her house in the well-heeled northern suburbs of Johannesburg ready to move to London, England.
Holt’s decision reflects what appears to be an accelerating trend in Africa’s biggest economy. Professionals, often young and in middle management but increasingly senior executives too, are leaving, adding to a skills shortage that is already acute.
Even though the global financial crisis is cutting job opportunities abroad — prompting some South Africans to consider moving home to take them up — at least eight top-level executives at listed companies have resigned this year to emigrate.
Clothing retailer Truworths said in October its financial director Wayne van der Merwe was relocating with his family to Australia, while wealth and asset management group Peregrine Holdings said in September its chief executive Keith Betty was moving to Australia.
The chief financial officer of chemical and explosives firm AECI emigrated after his 12-year-old daughter was shot in a robbery. And retail giant Massmart has reported a flight of senior management at the firm.
A property barometer by First National Bank released in October showed 18% of people selling their houses in the third quarter were doing so because they were emigrating, up from 9% in the fourth quarter of last year.
The Department of Home Affairs said it did not keep a record of the number of people emigrating.
Crime
For many, the main worry is South Africa’s shockingly high crime levels. An average of 50 people are murdered every day, according to the 2008 government crime report, with robberies, break-ins and hold-ups at businesses up almost 50%.
”In most instances I think the fundamental reason for leaving is violent crime,” said Azar Jammine, chief economist at Econometrix.
Peter Gent, chief operating officer of Rand Merchant Bank, said the investment firm is actively sourcing skilled labour overseas because of an exodus of investment bankers, accountants and information technology specialists.
”Certainly from the beginning of this year, one’s seen an increase [in emigration],” Gent said. ”I think it’s a real issue for the country.”
The skills exodus has hit the public sector too, and the government has been trying to recruit experienced artisans, particularly engineers, doctors and teachers, from abroad.
Those with the means to leave are still disproportionately white, but Gent said people of all races were emigrating.
”The 30-40 year range is where we’ve seen the bulk of the fallout, and typically it is people with specialist skills.”
Analysts say power cuts in January and a wave of xenophobic attacks in May further clouded the mood.
And many middle class South Africans and foreign investors have been rattled by the worst political crisis since the end of apartheid, which saw the ousting of president Thabo Mbeki.
African National Congress leader Jacob Zuma, frontrunner to become president after the 2009 elections, has strong ties to the left and there are worries he may veer away from Mbeki’s pro-business policies.
A corruption case against Zuma, in which he denies wrongdoing, has also troubled some South Africans.
”The current political situation is a concern,” said advertising executive Holt. ”Zuma I feel is not a very moral, ethical person.”
Global turmoil
The global recession might help reverse, or at least slow the trend, as jobs in London’s City freeze up.
South Africa has been shielded from much of the turmoil, as strict regulation has helped local banks like Standard Bank and Absa limit exposure to toxic United States assets.
While the country’s big four banks are likely to see slower growth as the slowdown hits exports and batters the rand, Standard Bank, Absa, Nedbank and FirstRand have all reported healthy liquidity profiles.
”The grass on the other side is looking a little less green than it was six months ago,” said Guy Lundy, co-author of South Africa: Reasons to Believe, a book that highlights the positive aspects of South Africa.
The Homecoming Revolution, a group which tries to persuade South Africans living abroad to move home, says it has seen an increase in people wanting to return this year.
Managing director Martine Schaffer said of the 1 000 South Africans who attended the group’s exhibition in London this month, four out of five were planning to return to South Africa.
”It’s such a beautiful country and there is so much potential, we need to come home and bring the skills that we got here from London and make a difference,” said Kathryn Hallock (30) who is moving home after more than eight years in Britain.
RMB’s Gent said the global freeze may well prompt young South Africans to scrap or delay their emigration plans.
”The slowdown in the global economy and specifically around investment banking will address that to some degree.” – Reuters