IT is a known fact that every organisation depends on human resources (HR) to fulfil its goals. A lot has happened in HR in the past few years.
We saw growth in work-from-home in Zimbabwe for the first time during the Covid-19 pandemic. The Labour Act was amended in 2023 with a far-reaching impact on HR practices.
The economic environment remains challenging, with businesses facing several changes ranging from depressed demand for goods and services and the flight of skills to the diaspora. The issue of when we will convert to 100% use of local currency in handling local transactions remains topical, with many economists speculating on what would happen should this go ahead.
To enable the management of HR, a stable economic environment is key, especially inflation and a stable exchange rate. Other economists think the forecasted drought will significantly slow economic growth in 2024. The mining sector has been complaining about tumbling mineral prices on the global market.
Looking at all these issues, see the following taking place around the management of people in the workplace.
Remote working
During the height of the Covid-19 pandemic, nearly 40% of managerial employees in Zimbabwe transitioned to a work-from-home model.
However, our recent survey of 123 organisations revealed that 80% have since returned to an entirely in-office workforce. Many of these organisations have adopted a hybrid work model, combining in-office and remote work.
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Despite initial enthusiasm for remote work, research indicates it may not enhance productivity. Studies suggest that working from home can decrease productivity by an average of 20%. This finding is particularly relevant in Zimbabwe, where corporations faced significant infrastructure challenges that made the transition to remote work difficult. These challenges included reliable power supply, data accessibility and access to the necessary equipment for a functional home office.
Given these factors, I predict that the work-from-home model in Zimbabwe will naturally decline as a permanent solution. Instead, it will likely be supplanted by online meetings for teams with dispersed offices, reducing the need for travel and related expenses for physical meetings.
Despite its shortcomings, the work-from-home model serves an important role as a contingency plan for emergencies that prevent employees from being able to come to the office. This experiment, driven by necessity, provides valuable insights for future workplace strategies.
Remuneration
Over the past year-and-a-half, significant changes have occurred in employee compensation. Many companies have begun to pay a substantial part of their employees’ salaries in United States dollars. Within the private sector, it is not uncommon for 80% of an employee’s salary to be paid in US dollars or its equivalent in Zimbabwean dollars.
This shift towards US dollar-based salaries will likely persist unless the government mandates the exclusive use of the Zimdollar for local transactions.
However, such a move would hinge on achieving exchange rate stability, which in turn is largely contingent on the country's inflation situation.
Notably, there was a period when only Zimdollar was accepted for local transactions, prompting some mining companies to seek special authorisation to pay their workers in US dollars to prevent them from migrating to regional competitors.
Looking ahead to 2024, it is anticipated that the trend of paying salaries in US dollars will continue unless drastic measures are taken to stabilise the exchange rate and reduce inflation.
Currently, state entities pay 40% of salaries in US dollars and the remaining 60% in local currency. Complicating matters is that some entities have contractually bound themselves to pay in US dollars. Such contractual obligations are difficult to rescind.
Moreover, the situation is further complicated because most National Employment Councils have incorporated US dollar salaries into their Collective Bargaining Agreements. Therefore, any alteration to the current remuneration structure will require careful consideration and strategic planning.
Skills flight
For many years, employees from Zimbabwe have been drawn to opportunities in the diaspora. However, it is distressing to note that many of these individuals take up lower-tier professional roles, such as nursing aids, driven by the necessity to provide for their families.
The prevailing wages for lower-level staff across various industries in Zimbabwe tend to be less than what they could earn abroad, even in menial positions.
Moreover, there's a growing trend of middle to senior-level professionals migrating to countries like Canada, New Zealand, and Australia. Despite the efforts of local companies, this continued exodus seems inevitable and unstoppable.
Job cuts
The prevailing economic condition, characterised by low aggregate demand, is anticipated to persist, particularly impacting businesses reliant on the domestic market for their sustenance, which, unfortunately, constitute the majority.
As we move into 2024, companies are expected to intensify their cost-cutting measures, potentially leading to an increase in job layoffs as businesses struggle to remain viable.
Hiring slowdown
Due to the sluggish pace of economic activities, it is projected that fewer businesses will be recruiting new employees in 2024. This downward trend in hiring began to emerge in the first quarter of 2023 and is expected to continue throughout the following year.
Skill development constraints
We have observed that, unlike other countries, companies have reduced their staff skill development investments. This is primarily due to budget limitations.
We forecast this trend to persist into 2024, which will likely have a significant impact in the subsequent years.
Technology, AI take-off
As we look towards the future, the business landscape in Zimbabwe is set to be significantly transformed through the adoption of technology and artificial intelligence (AI).
Zimbabwe will start slowly, but I see progressive companies moving and investing in AI to enhance productivity and competitiveness.
Many local companies will adopt AI and automation technologies to streamline operations, increase efficiency, and reduce costs. This could reduce the need for manual labour, particularly in sectors like manufacturing, logistics, and retail.
We can expect to see an increase in AI, data analysis, machine learning and robotics roles. Companies will need employees to develop, implement, and maintain these technologies.
The demand for digital skills will rise sharply. Employees will need to be up-skilled or re-skilled to meet the demands of a more technologically advanced workplace. Companies will likely invest more in training programs to equip their workforce with the necessary tech skills.
HR analytics
The HR sector has traditionally been hesitant to incorporate analytics, viewing it as an encroachment by non-HR individuals with quantitative expertise.
This reluctance turned out to be a self-inflicted setback for the industry. However, perspectives are gradually evolving, and it is anticipated that by 2024, all medium and large-sized enterprises will have a dedicated professional managing HR analytics.
In 2024, as Zimbabwean products face increased global competition, there will be a heightened focus on measuring and enhancing productivity throughout all sectors. This drive aims not only to maintain but also to elevate the competitiveness of Zimbabwe's industries internationally.
As many employees grapple with mental health issues, there will be an increased emphasis on employee wellness in 2024. Our 2016 study, which surveyed over 900 employees, revealed concerning numbers: 40% of respondents reported symptoms of distress, while 29% exhibited symptoms of clinical depression. These findings underscore the urgent need for renewed attention to mental health and well-being in the workplace.
Conclusion
Zimbabwe’s workforce landscape is evolving, marked by changes in work models, remuneration practices and talent migration. While the transition to remote work and US dollar-based salaries present challenges, they also open up opportunities for innovation and adaptation.
The ongoing exodus of talent and potential job cuts underscore the need for economic stability. The advent of technology and AI and a growing focus on employee wellness and productivity herald a new era for Zimbabwe’s HR profession.
These trends will shape the future of work in Zimbabwe, demanding resilience, foresight, and adaptability from its workforce and businesses.
- Nguwi is an occupational psychologist, data scientist, speaker and managing consultant at Industrial Psychology Consultants (Pvt) Ltd, a management and HR consulting firm. — https://www.linkedin.com/in/memorynguwi/ Phone +263 24 248 1 946-48/ 2290 0276, cell number +263 772 356 361 or e-mail: [email protected] or visit ipcconsultants.com.
