Nazia Pillay, interim MD for South Africa at SAP.
While six in 10 African companies view AI skills to be extremely important to their success, the portion of budget allotted to skills-related initiatives has declined since 2023. This lack of investment could result in organisations falling behind their more skills-enabled competitors.
This is according to the Africa’s AI Skills Readiness Revealed research, commissioned by SAP, and focused on the skills development efforts of African companies in the age of AI.
The research, which follows an earlier tech skills report released in 2023, was conducted at the end of 2024 among mid-size and enterprise-level companies, representing 100 respondents in Kenya (30), Nigeria (30) and SA (40).
AI skills have increased in relevance and are a key focus for businesses looking to secure footing within the rapidly developing AI space. It is particularly significant because the potential ROI from AI-driven business is substantial. The report stated that $1.5 trillion is the projected contribution of AI to Africa’s economy by 2030 if the continent can capture 10% of the global AI market.
Nazia Pillay, interim MD for SA at SAP, said: “African companies expect the demand for AI skills to increase this year, with six in 10 saying AI skills are ‘extremely important’ to their success. The business impact of a lack of AI skills availability is already evident, with 90% of companies in our research citing negative impacts that include project delays, failed innovation initiatives and an inability to take on new work.”
SAP added that skills related to AI are hugely in demand among African organisations, with 85% saying AI development skills are a priority, and 83% prioritising GenAI skills.
Every organisation surveyed expects the demand for AI skills to increase in 2025, and all companies expect to experience some AI-related skills gap this year. The need for AI skills was highest among South African organisations, at 78%.
According to the report, 94% of African organisations offer training and skills development to employees at least monthly, an increase from 74% in the previous research. The number of companies offering training opportunities to employees at any time also increased from 28% in the previous survey to 37% this year.
However, Pillay added that the portion of companies’ IT or HR budgets allocated to skills-related initiatives has declined since 2023. “The drop in budget allocation for skills development requires an urgent rethink. Organisations that don’t invest in appropriate skills now may find they are unable to leverage new innovations and emerging technologies, leaving them trailing their more skills-enabled competitors.”
Overall, the most in-demand tech skill among African organisations is cyber security.
Pillay continued: “Eighty-six percent of companies said cyber security skills were important to them, a significant increase over the 63% that said the same in our previous research. The growing importance of cyber security may be partly explained by the rapid growth of Africa’s digital economy and the millions of citizens that are being brought into the digital fold through public and private sector initiatives.”
The report stated that Africa’s digital economy will grow from 5.2% of GDP in 2025 to 8.5% in 2050.
The research also showed that when recruiting tech talent, African organisations prioritise AI and cloud skills, and consider a candidate’s affordability, adaptability and their ability to work in remote or hybrid environments.
