Updating of the critical skills list is going the wrong way with limits akin to those of a medieval guild

President Cyril Ramaphosa has said we will not achieve higher rates of growth and employment if we do not implement economic reforms. On his priority reform programme is “the revised critical skills list.”

Borrowing the wording of the immigration white paper of 2017, Operation Vulindlela says SA’s approach to critical skills and general work visas “should be designed to attract the skills that are needed for the economy to grow and to compete for these skills in a globally competitive market”. This approach has borne first fruit in the revised draft critical skills list that was finally released in February 2021 (originally due in 2018).

This list, published for comment before finalisation, allows foreigners in possession of the relevant qualifications to apply for a critical skills visa allowing them entry to SA without already having a job — a sensible element of any migration regime. However, the list is based on the conviction that it is possible to perfect a “scientific” approach to define the set of skills that are in critically short supply in SA. This is the wrong approach, for three reasons.

First, the list has been compiled to be as restrictive as possible. The lengthy technical report accompanying the list states that the intention of the consultation process is to reduce the list of critical skills from 126 in the draft (lower than the 170 occupations in the previous 2014 list) to some smaller number. This, it says, without offering any justification, is “absolutely necessary”.

Thus, the new critical skills list continues in the policy tradition that has dominated the management of skilled immigration for two decades: short-sighted tinkering with definitions, categories, quotas and models of skills needs to find a “scientific” justification for reducing skilled immigration to an absolute minimum.

Second, the approach taken seeks to limit immigration to people who have skills that are in “acute” short supply and which cannot rapidly be generated locally. This presupposes that the country has the ability to produce other skills that are in short supply but are not yet “acutely” absent. This is a strange assumption given the widely shared concern about SA’s skills-production capacity, rendered even more peculiar by the difficulties much-needed teachers and lecturers experience in moving to SA.

Making the best use of SA’s education and training system to maximise opportunities for our own people is, of course, a national priority. In this respect the critical skills list should be read along with another list inspired by the gap between demand and supply of skills in the economy.

The second list is of occupations in high demand (OIHD), published by the department of higher education & training in November 2020 and compiled by the same consultants using broadly the same methodology as the critical skills list. The purpose of the OIHD list is to guide the policies of the postsecondary education and training system to increase the pipeline of home-grown skills. The OIHD list duly identifies 345 occupations in high demand, one of the criteria being that they are “currently in shortage”.

It is not true to say that it is 345 occupations, however, because one of them is “university lecturer” and an appendix sets out a third list of more than 600 academic fields in which universities report difficulty in filling posts — scores under the heading “Agricultural, Environmental, and Natural Sciences”; more than 100 in “Engineering and the Built Environment”; and even more in “Medicine and Health Science”. It may be more accurate, therefore, to say the list contains something like 1,000 occupations.

The inclusion of the 600 categories of lecturer that SA’s universities struggle to recruit completely undermines the department’s confidence in the education system’s capacity to provide candidates for the other 345 occupations “currently in shortage” that are excluded from the critical skills list.

A final reason to worry about the “critical skills list” approach to migration reform is that it seems to be disconnected from the fact that the inflow of skilled migrants appears to have slowed to a trickle. Reliable information on such trends is hard to find. Stats SA has published numbers of work and business permits granted for the period from 2011 to 2014, but the only numbers for subsequent years can be found in department of home affairs annual reports.

There are problems with the comparability of these metrics, however, because Stats SA counted permits granted while the department counts the number of applications made. Data is also missing. Bearing these limitations in mind, it nonetheless appears that from 2015/2016 to 2019/2020 only 43,166 applications were made, less than half the 102,982 permits/visas that were actually granted in the shorter period of 2011 to 2014.

The decline appears to have set in around 2015, after which the number of applications recorded in annual reports fell to about 8,000 per year and reached a low of just under 7,000 in 2019/2020. This decline appears to be attributable mainly to a collapse in applications for business and general work visas, which totalled fewer than 1,500 in 2019/2020. Applications for critical skills visas rose from 4,400 in 2015/2016 to between 6,000 and 7,000 between 2016 and 2019, before dropping again to 5,400 in 2019/2020.

Where are we, then, on the vital issue of foreign skills? Nearly four years after the home affairs white paper on immigration policy acknowledged that “the economy is desperately short of skills” and that the government has not “put in place adequate policy, strategies, institutions and capacity for attracting, recruiting and retaining international migrants with the necessary skills and resources”, the government has released a much reduced critical skills list. This list will be used to limit skilled immigration into SA to the absolute minimum — despite business’s constant pleading for a much more open attitude.

This is entirely the wrong approach. It is hard to understand why a country with a serious skills shortage wastes money and time trying to work out what specific skills to let in. Modern, dynamic economies do not work the way the compilers of the skills lists assume. A 21st century economy is incompatible with an approach to the labour market that is akin to the practices of medieval guilds, which specified who could and could not do what kind of work. Many people’s formal qualifications bear little or no relation to where they end up working.

The irony is that we are devoting all this attention to minimising skilled migration at a time when we cannot control our borders. SA should have a far more open approach to skilled migrants of all kinds: those who are needed by existing companies, those who might start their own businesses, large and small, and those who might train and educate South Africans. All are needed to create jobs. None of these skills will go to waste.

Most importantly, we should go out and market the country as a destination for skilled, energetic and ambitious people. That is what should be on the president’s priority action list, not yet another even shorter critical skills list.

Bernstein is head of the Centre for Development & Enterprise.

Article published by the Business Day