SOUTH Africa is at risk of losing global manufacturing competitiveness because systems are not being implemented effectively.
This is according to consulting and advisory firm Deloitte and South Africa's Manufacturing Circle in its manufacturing competitiveness survey released yesterday.
"The stresses on the South African manufacturing sector could see SA becoming less competitive in the years to come‚ with its contribution to the national gross domestic product sliding from a historical high of 22% to below 12%‚" Karthi Pillay of Deloitte said.
South Africa ranked 24th out of 38 countries in the survey.
The survey was conducted to highlight major issues affecting South Africa's manufacturing competitiveness‚ with 76 respondents from local manufacturing companies with annual turnovers of between R300-million and R10-billion being surveyed.
The most important factors considered were the cost and availability of labour and materials‚ local market attractiveness‚ energy costs and policies‚ economic trade‚ financial and tax systems‚ and infrastructure.
A director in Deloitte's advisory services‚ Mike Vincent, said the local survey highlighted the scarcity of skilled labour and rising unemployment as huge constraints on South Africa's competitiveness.
"Adding to labour pressures is the fact that local labour laws and regulations could be improved to help the South African industry. This contrasts totally with the international survey, in which cooperation in labour employer relations‚ flexibility in wage determination policies‚ hiring and firing practices and pay and productivity are regarded as key factors contributing to labour market efficiency‚" he said.
Manufacturing Circle head Stewart Jennings said South Africa needed to bring in skilled artisans and engineers from abroad who could then pass on skills, as the education system was producing manufacturing professionals "very slowly".