CAPE TOWN, SOUTH AFRICA – South Africa’s Business Process Outsourcing (BPO) sector is experiencing a surge, creating over 6,018 new jobs in the last quarter of 2023 (October–December), according to Business Process Enabling South Africa (BPESA). This growth is particularly concentrated in KwaZulu-Natal (KZN), where nearly 39% of the new positions were established.
The KZN South Coast has emerged as a top destination for growth and investment, with BPO companies looking for alternative tier-two locations closer to talent and reduced property costs.
“The KZN South Coast has beautiful tourist towns; stable, warm year-round weather; and a pleasing landscape that makes it a great destination from which to operate,” said Reshni Singh, CEO of BPESA.
“There is a very active community ensuring maintenance and upkeep, with businesses and citizens working effectively together to ensure sustained operations. The property sector is driving a lot of the activity, with the area open to business and growth,” Singh added.
Addressing unemployment through BPO
BPESA reported that the BPO sector is growing, with 7,900 new jobs bringing in ZAR2.7 billion ($143 million) in foreign revenue in the past fiscal year. The sector is seen as a critical component in addressing South Africa’s unemployment crisis—with a target of 500,000 new jobs by 2030.
South Africa currently holds one of the highest unemployment rates in the world, standing at 33.5% and rising in the first quarter of this year. Unemployment rates are especially high among South African youth compared to older age groups and among Black people versus other population groups, with the unemployment rate rising to a staggering 45.5%.
South Africa’s economic growth remains sluggish, unable to keep pace with population growth. Frank Blackmore, KPMG South Africa’s lead economist, stated that as long as the economy continues to grow below 1% with population growth at about 1.5%, the unemployment rate will continue to rise.
However, the BPO sector presents a promising opportunity. While traditional sectors like community services and construction are experiencing job losses, BPO, along with manufacturing, agriculture, and mining, is creating new employment avenues. As the sector expands, it has the potential to be a significant force in driving economic growth and creating a more stable job market.
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