Top story: Expatriate salaries in Africa fall interview with Globe 24-7 CEO Lachlan Spicer, on the salary and employment trends of expatriates working in the African mining sector:

Expatriate salaries in Africa fall

Friday, 19 December 2014

Original Article

EXPATRIATE salary benchmarks in Africa have reduced by around 21% over the past 12 months, according to African-specialist HR consultancy firm Globe 24-7.

Globe 24-7’s bi-annual African Remuneration and Benefits Benchmarking Report gathers data from more than 25 ASX, TSX, JSE and AIM-listed African mining companies on remuneration, benefits and employment conditions. Globe 24-7 CEO Lachlan Spicer said that the bi-annual report was a fascinating insight into the current employment conditions for expatriates working in Africa.

“Throughout 2014, there has been continued rhetoric and commentary regarding the woes of the African mining industry driven largely by macro-economic factors including volatile commodity prices; global health scares; sovereign risk concerns; and in some countries, civil unrest,” he said.

“What the report confirms is how these macro-level concerns are impacting companies on a day-to-day basis with cost cutting and cash preservation practices flowing down to the expatriate workforce.”

And it wasn’t just salaries that were affected – benefits including travel, rosters and other perks were affected as companies moved to lower overheads.

“Companies who previously might have offered business class flights with travel in-company time, may now be offering economy class and shared travel time in an attempt to further reduce costs,” Spicer said. Lower-cost talent pools are also being drawn upon with expatriate labour in Africa now being made up from 64 different countries including non-traditional ones like Greece and Serbia.

The report also notes the emergence of African domiciled employees working as expatriates in greater Africa who currently make up 53% of the report’s employee base.

“This is a trend that we’ve seen unfold over the past few years with African nationals now making up a significant portion of the expatriate labour pool,” Spicer said. “Countries like Ghana, Tanzania, Mali, Senegal and Burkina Faso have developed employees with an excellent mining competence that is now being utilised in greater Africa. “It’s a vote of confidence that these countries are developing competent industry professionals.”

Spicer believes that although salary levels have reduced significantly over the past two years, there is evidence to suggest that the market may have bottomed out.

“Our first-half report found a significant drop of 19% between November 30, 2013 and May 30, 2014 with only a further 2% reduction in the past six months,” he said. “The data supported our view that expatriate salary levels had found its new level and we would only see marginal fluctuations in the latter part of 2014. “Over the past 12 months, many companies have implemented cost reduction strategies and based on this, we expect 2015 to stay relatively steady at these levels.”

Spicer said the report was useful for companies to use as a benchmark to remain competitive in the African employment market.

“Companies use the report in different ways and many will take on board the findings for their 2015 salary review process,” he said. “Rather than relying on speculation and ‘he said, she said’, it is much wiser to draw upon actual data to support these significant decisions.”

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