Greater flexible working could add R17 billion annually to the South African economy
Aug 26, 2015
Study from Citrix and Centre for Economics and Business Research finds increased use of flexible working could add 0.4% to South Africa’s GDP
JOHANNESBURG, SOUTH AFRICA: Citrix, the leader in mobile workspace solutions, today announced the results of its study with London-based Centre for Economics and Business Research (Cebr) into the potential economic impact of a more widespread ‘work from anywhere’ culture in South Africa.
The study found that if the South African knowledge worker[i] population fully utilised flexible working, it is possible to add an extra R17 billion per year to the South African economy through the more productive use of available working hours - the equivalent of 0.4% of GDP.[ii] In addition, more extensive flexible working practices could save commuters a total of R44.1 billion , by a reduction in commuting costs ( R39.5 billion ) and the time spent travelling, which also has a value[iii] .
Benefits to today’s workforce
There is currently a high demand from employees in South Africa to work more flexibly, with 93% of South African knowledge workers indicating that they would opt to work from home or an alternative remote location on average 19 hours per working week. If organisational culture throughout South Africa evolved to embrace this, there would be savings in commuter costs of R39.5 billion, with a reduction of **320 million **[iv] hours spent travelling to and from work annually. Such changes would result in an improved work-life balance as well as considerable financial gain for individuals. The leisure time gained through the greater adoption of flexible working accumulates to 1.2 million additional hours per year or 110 hours per person per year.
Widening South African employment
In addition to improving the work-life balance of those currently in full-time employment, the report also indicates that more flexible working opportunities could deliver significant benefits to the wider South African economy by further engaging people working part-time, or previously excluded from employment. The research revealed that:
- There is scope for technology-enabled flexible working to encourage over 5 million people in South Africa that are currently unemployed or economically inactive to be enabled or more willing to join the labour force. The study indicates that 95% of these respondents would be inclined to start working if given the tools to do so
- This group of unemployed or economically inactive workers is responsible for 91% of the total potential boost to GVA, equivalent to R169 billion annually or a 4.5% boost to GDP, with the remainder of R17 billion contributed by productivity improvements of people currently in work
- 90% of part-time working respondents indicated that they would be inclined to work more hours if given the opportunity to work remotely. With 574,000[v] part-time workers in South Africa who would like to work remotely, this could potentially create an additional R5.2 billion in Gross Value Added output[vi]
- With the aid of flexible working, the total South African economic output contribution could be boosted by as much as R187 billion (in Gross Value Added) per annum[vii]
Issues such as load-shedding and high fuel prices take their toll on the workforce financially, physically and psychologically. Businesses in South Africa need to look very closely at the provisions they make for flexible working. Those that choose not to enable workplace mobility will lose out in the war for talent and could arguably suffer from lower employee productivity,” he says. “This study highlights an opportunity for employers to collaborate with remote-working technology providers to ensure that employees are in a position to seize the opportunity to engage in such flexible working practices. The economic argument for flexible working is quite clear – South Africa as a whole needs to contribute to a culture where anywhere, anytime working is the accepted norm. - Brendan Mc Aravey, Country Manager South Africa, Citrix
[i] Knowledge workers: those whose main capital is knowledge and, therefore, “think for a living”, e.g. architects, software engineers, lawyers, doctors, accountants, academics etc.
[ii] This is based on the survey results that revealed 1) the proportion of employed that want to use flexible working and 2) the number of available hours per working week that these individuals could devote to productive work tasks because flexible working enables better time management and reduces downtime associated with, for example, the need to travel back to the office from a business meeting at a client site.
[iii] There is limited data on the value of commuter time in South Africa with most information being outdated. The most relevant to our study is a paper by NJW VAN SYL et al., 2001, who estimates the South African commuter value of time in an assessment of the impact on toll roads. We identify the ratio of consumer value of time to worker income from this paper. This is then applied average wages data in 2014.
[iv] The potential reduction of expenditure on commuting expenditure and hours saved are calculated by mapping the survey results to the South Africa population analysed – 93% of respondents if provided with flexible working opportunity would on average spend 19 hours per week working from home or an alternative remote location. The commuting time savings of 320 million hours indicates the reduction in time spent commuting by the relevant population of knowledge workers.
[v] Applying the survey results, we estimate that there are 574,000 part-time workers within South Africa that would want to adopt working practices that enable them to work from various locations. Please see Table 4, pg.36 of the report.
[vi] This is based on the survey results that revealed 1) the proportion of part-time workers who want to use flexible working but currently do not have the option and 2) the number of extra hours they would work if provided with flexible working.
[vii] This estimate is based on a survey of 1,256 members of the South African population and an extrapolation of the findings for each of the demographic groups represented in the sample to the South African knowledge worker population. As such, the findings most likely represent a ‘best case scenario’ in terms of the perceived benefits of a flexible working culture but nonetheless reveal a potentially significant opportunity for business and government alike
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