Document: Isett_Seta_Sector_Skills_Plan_2011_2016_Jan_2011_Version

Description

The Isett Seta is responsible for Skills Development in the Information Systems (IT), Telecommunication
Technologies, and Electronics subsectors. The Isett sector comprises of 127 Large companies, 256 Medium
companies and 2,289 Small companies. The number of employees in the Isett Sector in 2010 was estimated at
143,076. Large companies employ 96,015, Medium companies employ 17,719 and small companies employ
29,342.
In terms of the number of employees, about two-thirds of the employees are employed within Gauteng, followed by
the Western Cape at 17%, KwaZulu-Natal at 8% and the Eastern Cape at 3%. The Isett Seta has offices in all four
of these provinces.
The IT Sub-sector is the largest sub-sector within the Isett Sector, accounting for just over half of the number of
employees, followed by the Telecommunications Sub-sector which accounts for about one-third of the number of
employees.
From 2005 to 2008 employment in the Isett sector grew steadily from 133,409 to 144,185. This represents an
average increase of 2.6% in employment. As the global economic crisis unfolded in 2008, the economy lost
344 000 jobs between 2008 and 2009, whilst the Isett sector lost about 2,256 jobs. The Sector experienced its first
decline in employment in four years, but made a small recovery in 2009/10 with a growth of 0.8%.
In 2009, the percentage of black personnel in the Isett Sector was determined to be 54%. This is short of the
national target of 85% black (African, Coloured and Indian). With regard to gender, the Isett Sector was
determined to comprise 35% females in 2009, compared to a national target of 54%. Compared to a national
target of 4% people with disability to be employed within the country, the Isett Sector was estimated to comprise
only about 0.5% people with disability in 2009.
The occupational composition of the sector is as follows: Managers (15%); Professionals (32%); Technicians
(23%); Clerical and administrative workers (20%); Sales workers (6%); Machinery operators and drivers (2%); Elementary
workers (3%); Elementary (15%). High skills occupations (Managers/Professionals/ Technicians) constitute 70%;
intermediate skills (Clerical and administrative workers and sales workers) make up 26% and low level skills; (Machinery
operators and drivers and elementary) comprise 5%. A high percentage of people are in the high skills category
(70%). There is an opportunity to move people with low level skills into the intermediate category. Likewise there
are opportunities for those with intermediate skills to move into the high skills category with meaningful education
and training interventions.
The South Africa IT market experienced negative real growth in 2009, and IT Hardware is also likely to experience
negative real growth over the next five years. In real terms, the market is seen to be growing at only about 1% per
annum for the next five years. This does not bode well for employment in the IT Sector.
According to BMI-TechKnowledge, “Despite the global recession, the South African IT market did register some
small growth in 2009. The research group says local IT market revenue grew 2.5% from R60.36-billion in 2008 to
reach R61.85-billion in 2009. And it expects a similar growth pattern this year with 2.5% growth to R63.41-billion,
and at a compound annual growth rate (CAGR) of 6.3% to reach R83.97-billion in 2014.
The hardware market declined by 3.8% in 2009, from R21.91-billion in 2008 to R21.1-billion in 2009. Hardware
accounts for 34.1% of the total IT market and is expected to see a CAGR of 3.3% over the forecast period.
Storage will be a category that should outperform other hardware areas due to continued server virtualisation.
The South African IT Services market is estimated to have reached R28.9-billion in 2009, showing a year-on-year
growth of 7.2%, and accounted for 46.8% of the total IT expenditure in South Africa. The IT services market value
is forecast to grow to R41.39-billion by 2014. This reflects a CAGR of 7.4% over the forecast period. Hosting is the
standout category, looking forward, in the IT services arena considering the drive towards cloud computing.
The packaged software market grew by 3.5% in 2009 to R11.86-billion, and is expected to show growth of 8% in
2010. Packaged software accounted for 19.2% of the IT spend in 2009. The packaged software market value is
forecast to grow to R17.76-billion by 2014. This reflects a CAGR of 8.4% over the forecast period. Adoption of
Software as a service (SaaS) and Virtual Desktop Infrastructure (VDI) are areas that will drive growth in the
Software market.”1

Table of Contents

1 Executive Summary 1
OVERALL OBJECTIVES OF THE ISETT SETA STRATEGIC PLAN 2
2 Introduction 3
2.1 Background 3
2.2 Purpose of the Sector Skills Plan 3
2.3 Defining the Isett Seta Sector 3
2.3.1 Introduction 3
2.3.2 SIC Codes 3
2.4 Caveats 4
2.5 Isett SSP Target Audience 4
2.6 Data Sources 5
2.7 Layout of this Document 7
2.8 Abbreviations Used in this Document 8
3 Isett Seta Sector Profile 10
3.1 Economic Profile 10
3.1.1 Introduction 10
3.1.2 National Outlook 10
3.1.3 Isett Sector Outlook 12
3.1.4 Forecast for the Isett Sector 15
3.2 Isett Stakeholder Sector Assessment 15
3.2.1 Introduction 15
3.2.2 Strengths, Weaknesses, Opportunities and Threats 16
3.2.3 Suggested Implications on and Strategic Goals for ICT Employment and ICT Skills Development 16
3.2.4 Challenges Involved in Developing ICT Skills in Rural Areas 19
3.2.5 Suggested Isett Seta Assistance 19
3.2.6 Sectoral Economic Scenario 20
3.2.7 Isett Assistance with Equity in Stakeholder Organisations 21
3.2.8 Opportunities for New Venture Creation 22
3.2.9 Code of Conduct for Professional Bodies 22
3.2.10 Isett Assistance to Building Capacity 22
3.2.11 Additional Comments and Suggestions 23
3.3 Company Profile 23
3.4 Employment Profile 23
3.4.1 Number of Employees in the Isett Sector 23
3.4.2 Race, Gender and Disability Segmentation of Employees in the Sector 24
3.4.3 OFO Major Group Segmentation of Employees in the Sector 25
3.4.4 Isett Seta Sub-Sectors 26
3.4.5 Provincial Distribution of Employees and Sites 27
3.5 Drivers of Change 28
3.5.1 The Human Resource Development Strategy of South Africa (HRDSSA) 28
3.5.2 The SA Government’s Medium Term Strategic Framework (MTSF) 29
3.5.3 The Industrial Policy Action Plan (IPAP) 29
3.5.4 The Integrated Sustainable Rural Development Strategy (ISRDS) 29
3.5.5 National Industrial Policy Framework (NIPF) 29
3.5.6 ICT Charter 29
3.5.7 Accelerated and Shared Growth Initiative for South Africa (AsgiSA) 32
3.5.8 Joint Initiative on Priority Skills Acquisition (JIPSA) 32
3.5.9 The South African e-Skills Council 33
3.5.10 The Department of Communications 34
3.5.11 Other Legislation 37
3.6 Conclusion and Recommendations 37
3.6.1 Forecast for the Isett Sector 38
3.6.2 Tactics that can be employed by Isett in the Formulation of the 5-year SSP 38
4 Supply of and Demand for ICT Skills 40
4.1 Introduction 40
4.2 Supply of ICT Skills 40
4.3 Demand for ICT Skills 46
4.4 Supply of ICT Skills versus Demand for ICT Skills 47
4.5 Assessment of Formal Education Institutions 48
5 Scarce and Critical Skills 48
5.1 Introduction 48
5.2 Isett Involvement in Types of Training Programmes by NQF Level 48
5.3 Demand for Scarce Skills 50
5.3.1 Introduction 50
5.3.2 Demand for Scarce Skills, by Learning Programmes and NQF Level 50
5.4 Demand for Critical Skills 55
5.4.1 Introduction 55
5.4.2 Demand for Critical Skills, by Learning Programmes and NQF Level 55
6 The Isett Seta 2011 – 2016 Strategy 59
6.1 Introduction 59
1 INTRODUCTION/EXECUTIVE SUMMARY 61
1.1 Key mandate 61
1.2 Objective of the Seta 61
1.3 Legislative framework in which the Seta functions and policy and legislative changes that influence
programme spending plans. 61
1.4 Background on establishment 62
1.5 Development of this Strategic Plan 62
1.6 Materiality 62
1.7 Key assumptions underlying the Strategic Plan 63
1.8 The Sector Skills Plan 63
2 PURPOSE OF THE STRATEGIC PLAN 63
2.1 Environmental, Technological and Socio Economic Imperatives
3 VISION 65
4 MISSION STATEMENT 65
5 OBJECTIVES OF THE STRATEGIC PLAN 65
5.1 OVERALL OBJECTIVES 65
5.1.1 Objectives per Component Linked to Programmes 66
5.1.2 Objectives of the Information Systems (IT), Electronics and Telecommunications Technologies Seta
67
5.2 HUMAN RESOURCES 68
5.2.1 Recruitment Strategy / Employment Equity Plan 68
5.3 FINANCIAL RESOURCES 69
5.3.1 Assumptions upon which the Budget Is Based 69
5.3.2 Fixed/Moveable Assets 70
5.4 FINANCIAL RESOURCES OBTAINED FROM DONORS 71
6 RISK MANAGEMENT 71
7 Tactical approach to be employed by the Isett Seta in Executing its 5-Year Strategy 72
7 References 73
Appendix 1: ICT Sector SWOT 74
Appendix 2: Assessment of Formal Education Institutions 76
Appendix 3: Sectoral Economic Scenario 79
Appendix 4: Synopsis of the HRDSSA II MTSF 81
Appendix 5: MEDIUM TERM STRATEGIC FRAMEWORK 84
Appendix 6: Synopsis of potential Isett contribution to the Industrial Policy Action Plan (IPAP) 88
Appendix 7: Synopsis of potential Isett contribution to the Integrated Sustainable Rural Development Strategy
(ISRDS) 89
Appendix 8: National Industrial Policy Framework (NIPF) 92
Appendix 9: List of Private FET Colleges 96
Appendix 10: List of Public FET Colleges 111
Appendix 11: List of Public Universities and Universities of Technology that provide ICT Qualifications 112
Appendix 12: A Comparison between the Number of Companies in 2010 against the Number in 2009 113

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