Monday, September 27, 2021

Botswana economy grapples with skills shortage, mismatch

Seven years ago, government in conjunction with the World Bank embarked on a study on Botswana’s need to diversify its economy to facilitate stronger, more sustainable economic and employment growth and, concurrently, equip its workforce with a variety of skill set that meet employer needs.

The comprehensive analytical study entitled “Skills for Economic Growth and Diversification in Botswana” produced four policy notes on “Raising Botswana’s Human Resource Profile to Facilitate Economic Diversification and Economic Growth”; “Labour Market Signals on the Demand for Skills”; “Skills Needs of the Private Sector”; and “Skills Implications of Botswana’s Diamond Beneficiation Strategy”.

The objective of the study was to inform the government with concrete strategies for policy interventions that strengthens the skills base of the workforce and thus facilitate economic growth, diversification, and employment.

The first note assesses the strengths and weaknesses of the country’s education system (i.e., basic technical and vocational, and higher education) and recommends policy interventions to strengthen students’ acquisition of relevant knowledge and skills.  

The second note examines both current labour and skills demand (based on available labour market data) and expected skills demand (based on the government’s economic strategies). On the basis of this analysis, the note offers recommendations on skills development and government programmes.

The third note uses the findings of an employer-employee survey conducted in Botswana in 2010 to identify skills needs and gaps from the viewpoint of the private sector.

The last note examines the skills implications of the government’s diamond beneficiation (processing) strategy and suggests actions that can be undertaken to ensure that the nation’s skills base supports, rather than hampers, implementation of the strategy.

According to “the Skills Needs of the Private Sector in Botswana” report, human capita enhances labour productivity, aiding the adoption and adaptation of technology and stimulating innovation for economic growth. Countries with better-educated workforces have higher growth rates in the long run.

However, employers in Botswana appear dissatisfied “with the skills of their employees, and the labour force available in the country”. The Global Competitiveness Report 2020 – 2011, for example, reported that “firms in the country consider two of the top constraints to doing business to be a poor work ethic and lack of an appropriately educated labour force”.

Recent research emphasizes that certain key competencies provide the basis for the adaptability and continuous learning of workers in a rapidly advancing knowledge economy. These competencies include cognitive, academic, and technical skills; behavioural (or soft) skills, such as problem solving, creativity, interpersonal skills, and work ethics; and management skills.

Information on the demand and supply of behavioural and management skills is not commonly collected by labour or household surveys, or by student learning assessments.

Given Botswana’s need to diversify its economy, “it is important to analyze the skills that employers demand and how well employees in the country match that demand. Such an analysis can help focus policy on the critical needs of the economy”.

The ultimate aim of the World Bank survey was “to assist the government in developing policies to achieve Botswana’s vision of a diversified knowledge economy. Some of the issues of interest included the incidence and role of training in labour productivity, as well as patterns in the demographic characteristics and skills of the workforce”.

According to the report, employers identify skills constraints as an important factor in doing business in Botswana. Issues related to work ethics and the need for appropriate behavioural skills was also reportedly cited as an important concern, as the lack of skills appears to affect productivity.

Additionally, it appears that the workforce lacks job-specific skills, in particular, the higher-order skills associated with mid-level management positions, as well as engineering, science and technology skills.

According to the survey, “a shortage of “employability” traits in the labour force is frequently cited as a major obstacle to private sector development throughout the developing and even in a number of developed countries. Such perceptions can be real or a manifestation of other labour market constraints, but are often easier verbalized as lack of appropriate skills”.

In fact, “the constraints faced by employers might be a skills mismatch, that is, an appropriately trained labour force, but trained in fields that are not in demand. Alternatively, employers may be experiencing poor skills matching, that is, they are unable to find the people with the right skills due to inefficient labour market clearing mechanisms, such as job placement services and efficient dissemination of information on job availability.

“In the same way, the workforce, young workers in, particular, may be unable to signal to employees the skills that they have – in other words, the constraint is poor signaling. Each of these issues can be viewed by employers as skills constraints, but the policies to deal with them are very different”.

The survey also notes that when faced with skills shortages in a country, governments often turn to expatriates to fill gaps. However, the perception among employers in Botswana is that it is quite cumbersome to hire expatriates. Employers must first advertise a vacancy and wait for a mandated period for qualified applications.

The survey also found that a high proportion of employees consider personal characteristics, such as their commitment and hard work, to be among the main reasons for being hired in their current jobs, followed by reliability, punctuality, and honesty.

Workers also believe these characteristics, together with the desire to learn and the ability to work independently, are appreciated by management. Of note, reliability and punctuality is also a trait that employees would like to see more in their co-workers.

In conclusion, the study recommended that government should “make a strategic shift and expand tertiary” since the country has a high enrollment and completion rates at the basic and secondary education levels although the quality of education remain a challenge at these levels.

As a middle-income country, Botswana has achieved close to universal primary education and has a high enrolment at the secondary education level. However, low returns to completed higher secondary education (i.e. the General Certificate) and the demand for tertiary-educated individuals even for less academically demanding occupations point to a need to build the higher education system in the country.

Given the high wage premium to tertiary and higher levels of education, “the private benefits of tertiary education are high. As such, tertiary education should not be as heavily subsidized as it is in Botswana. If the country is to move towards a knowledge-based economy, however, postgraduate and doctoral level studies need to be encouraged, with a strong focus on science, technology, engineering, and mathematics (STEM) skills, as well as on research and innovation”.

According to the study, since the private sector in Botswana is not yet robust, students and or employees who are funded for postgraduate studies, work predominantly in the public sector. In order to support skills training that will facilitate the growth of the private sector, the government urgently needs to prioritize the delivery the good-quality tertiary education, particularly STEM skills.

The grant/loan programme should accordingly gradually shift towards post-graduate education in these disciplines in order to provide a cadre of highly skilled workers for the private sector.

The survey further reckons that Botswana is endowed with a relatively high share of lower and upper secondary graduates. If the quality of basic education is good, this pool should be an asset for the country. More specifically, graduates of basic education should be a trainable and flexible group of workers who can adapt to employer needs.

On-the-job training can help new hires acquire skills in areas of need to the employer, provided that they have certain prerequisites, for instance, basic knowledge of science and mathematics for technical work.

“In conclusion, the challenge for government is to create an optimal framework for training based on well-defined roles and responsibilities of the public sector, private firms, and households”, the study advised.

On the “Raising Botswana’s Human Resource Profile to Facilitate Economic Diversification and Growth” report, it is acknowledged “that the key factors to drive self-sustained economic growth over the long term are innovation, knowledge sharing, and research and development”.

Other studies have reckoned that there are strong inter-linkages between capital and investment on one hand, and the quality of human capital available in an economic system on the other. Similarly, research and development (R&D) can develop a nation’s capacity to absorb existing technology; thus increasing total factor productivity.

In general, tertiary education is expected to create high-end skills needed for innovation. The critical mid-level skills required for the absorption and or adaptation of technology gained from either tertiary or technical and vocational education.

The report further observes that globalization has encouraged higher education to embrace a role in economic development and the creation of knowledge societies. In the initial period after independence, Botswana primarily focused on primary and secondary education.

Given its success in basic education attainment and the growing importance of skilled graduates in the global economy, “higher education has assumed greater importance in Botswana”. In response, tertiary education policy became more market oriented, entrepreneurial, and geared towards satisfying labour force demands.  

The report further laments that “the country boasts high investments in education, yet faces significant challenges of educational quality compared to countries with similar levels of gross domestic product (GDP) per capita”.

Given the country’s vision of reducing its reliance on its main natural resource – diamonds – and shifting towards a knowledge-based economy, “the education sector will need to be a principal focus of reform in coming years”.

The study recommends that the quality of educations needs to be improved and the capacity of technical vocational educational training (TVET) training staff must be bolstered while collaboration with universities, industry, and other research centers must increasingly be developed so that tertiary education is aligned with the needs of the labour market and the nation.

According to the report, in the medium-term, Botswana should “adopt a monitoring, evaluation, and research system in order to understand the process of student learning, identify issues related to inadequate student performance on international assessments, and inform the design of interventions that would align national educational outcomes with the needs of the global economy”.

The country should also define mechanisms for using the training levy so that these funds cater to the specific needs of employers, for instance, by supporting specific types of technical training at BOTA-accredited institutions.

In the long-run the country is advised to establish an educational research institute under the tertiary education ministry as well as to develop selected faculties at the University of Botswana (UB) and Botswana International University of Science and Technology (BIUST) as a center of excellence in science and technology teaching through viable, sustainable financing, including research and consultancy revenues, donations, and private capital.  

The study also notes that to date, government has not yet created a dedicated institution to conduct research in education. The Department of Education of the UB has partially served this role. The education ministry has recently approved the structure of a reorganized Department of Planning, Statistics, and Research that upgrades the current department into a division.

“Whereas unemployment caused by lack of demand in the labour market cannot be addressed by education and training systems, unemployment caused skills mismatches should be”, states the report adding that it is evident that “unemployment in Botswana appears to be the consequence of inadequate training or training in fields of specialization that are not in demand on the labour market”.

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