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The next manufacturing competitiveness challenge may not be electricity. It may be skills and productivity.

Home / Thought Leadership / The next manufacturing competitiveness challenge may not be electricity. It may be skills and productivity.

For years, South African manufacturers have had to navigate electricity instability, rising input costs, infrastructure constraints and an increasingly difficult operating environment.

While some of these pressures remain, another challenge deserves greater attention. This is whether manufacturers have the skills, productivity and reward models required to remain competitive.

Manufacturing is changing. Automation, digitalisation, AI and advanced production technologies are transforming how work is performed and the capabilities organisations need. At the same time, competition for engineers, artisans, technicians, maintenance specialists, production leaders and specialist digital and automation skills continues.

Manufacturers must attract and retain these capabilities while protecting margins and managing employment costs. This creates a difficult reward equation. Manufacturers cannot simply pay everyone more, but neither can they afford to lose the people who keep their plants running, prevent costly downtime, improve productivity and enable future growth.

The challenge is therefore not simply how much organisations pay, but where and how they invest their reward spend to create the greatest business value.

Are manufacturers rewarding what really drives competitiveness?

Manufacturing leaders should be asking:

  • Which skills are genuinely critical to our operations and future strategy?
  • Where are our greatest retention risks, and what would losing these capabilities cost the business?
  • Are we benchmarking specialist roles against the right talent markets?
  • Are our job grading and salary structures keeping pace with changing technologies and skills?
  • Are our incentives driving productivity, quality, efficiency, safety and output?
  • Are we rewarding high performance and valuable contributions, or simply increasing fixed employment costs?
  • Are we developing and retaining the technical capabilities we will need over the next three to five years?

A one-size-fits-all approach to remuneration is becoming increasingly difficult to justify.

A scarce automation specialist may compete in a very different talent market from a traditional production role. An experienced artisan who prevents hours of plant downtime may create value far beyond what a conventional salary structure recognises. Equally, a production incentive that rewards output without considering quality, safety or efficiency can create unintended consequences. The answer is not necessarily to pay more, but to reward more intelligently.

This means identifying critical capabilities, understanding retention risks, benchmarking against relevant talent markets, differentiating reward where justified and ensuring incentives reinforce measurable business performance.

For manufacturers, reward should increasingly be viewed as a strategic lever for productivity, skills retention and competitiveness, rather than simply an annual salary increase exercise.

At Khokhela Remuneration Advisors, we help organisations develop practical, commercially sustainable remuneration solutions across benchmarking, critical and scarce skills, job evaluation, salary structures, incentive design, recognition, pay equity and remuneration strategy.

The question for manufacturing leaders is no longer simply: “Are we paying competitively?” but rather: “Are we investing in the people, skills and behaviours that will drive future competitiveness?”

Ultimately, manufacturing competitiveness will depend not only on investment in technology and infrastructure, but also on how strategically organisations invest in, reward and retain the people who drive productivity, innovation and sustainable growth.

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About Khokhela

We are a boutique advisory firm specialising in remuneration, performance, and talent alignment and have built long-term relationship with our clients.

We engage talent within your business by designing remuneration solutions that drive performance and enhance productivity and your bottom line.

We achieve this by developing bespoke solutions based on best practice and industry knowledge which solves our clients’ challenges.

How can we help you?

  • Remuneration
  • Performance
  • Job Evaluation System
  • Transactions & Risk Support

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