As South Africa continues to grapple with unemployment, businesses must embrace data-driven hiring practices to make informed decisions and secure top talent.
The country’s official unemployment rate stood at 32.1% in the third quarter of 2024, marking a decline from 33.5% in the previous quarter1. However, unemployment remains a major challenge despite this improvement, making it crucial for businesses to implement data-backed hiring processes.
Concerningly, about 27% of South Africans have considered emigrating, with higher consideration among the wealthiest (42%), the most educated (38%), those holding full-time jobs (36%), and the youth (32%)2. This potential talent drain exacerbates the challenge of sourcing and retaining skilled professionals, heightening the need for strategic, data-driven hiring practices.
Jennifer Barkhuizen, Head of Marketing at Managed Integrity Evaluation (MIE), the largest background screening and vetting company in Southern Africa and a business unit of Mettus, iterates the importance of comprehensive screening and vetting processes to bridge the skills gap and strengthen workforce capabilities.
“South African businesses face economic pressure and a competitive talent market. The demand for qualified professionals is greater than ever as companies seek to drive growth and contribute to economic recovery.
“To hire and retain top talent while mitigating long-term risks, businesses must prioritise data-driven hiring – incorporating background screening, credential verification and skills assessments. This is essential for building a skilled, reliable, and high-performing workforce,” says Barkhuizen.
Jennifer Barkhuizen
Organisations that rush the hiring process to fill vacancies often face significant drawbacks, such as misaligned skills, high employee turnover, and lost productivity. Hiring underqualified candidates not only impacts overall company performance but increases long-term costs associated with training and rehiring.
Data-driven hiring practices provide businesses with the necessary tools to make informed hiring decisions. Through rigorous background checks, credential verification, and skills assessments, organisations can ensure that prospective employees possess the required expertise and competencies. MIE offers tailored solutions that empower businesses to verify candidates’ credentials and assess their skills, ensuring a perfect match between job requirements and candidate capabilities.
“By utilising comprehensive screening and leveraging data insights, businesses can bridge the skills gap effectively,” adds Barkhuizen. “Matching candidates’ qualifications and skills to specific job roles enhances workforce alignment, reduces training costs and improves overall productivity. Data-driven hiring strategies ensure that businesses employ individuals who are well-equipped to contribute meaningfully to their organisations from day one.”
Sustainable business growth is directly linked to informed hiring decisions. A strong, well-vetted workforce is essential for meeting the demands of evolving industries. Effective solutions can help businesses not only fill positions but also cultivate talent development strategies that support long-term success and industry competitiveness.
“By implementing comprehensive, data-driven screening and verification solutions, businesses can strengthen their hiring strategies, enhance operational efficiency, and secure top-tier talent essential for long-term success and competitiveness,” concludes Barkhuizen.
Hiring talent is a crucial decision, and the question of hiring a permanent employee or engaging an independent professional deserves serious consideration. Below, we break down the cost and other implications of hiring permanent employees compared to independent contractors.
The true cost of a permanent hire: Beyond the salary
Let’s take a look at the true cost of hiring a permanent employee. While the advertised salary of, for example, R50 000 per month (or R600 000 annually), may seem straightforward, this isn’t the whole picture.
Many companies offer performance-based bonuses, often around 10% of the annual salary, which needs to be added to the cost.
Finding the perfect fit usually includes recruiters and their fees – on average between 15-25% of the annual salary. This is typically spread over an agreed period, on average 12 months for new hires, adding an additional R45 000 – R60 000 to the annual cost. This takes our annual salary to +-R650 000.
To obtain a true monthly cost, we must also consider paid leave and sick leave. Permanent employees are entitled to 20 – 22 days of leave per year (about a month), and then additional leave for sick days or family emergencies (add a week). Now deduct 1.25 months from the year and divide R650 000 by 10.75 months. The result is a true monthly cost of approximately R60 465. This is about 21% more than the stated R50 000 monthly salary, reinforcing the importance of budgeting at least 20% more than the base salary for a permanent hire.
