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Bidding war over tech talent intensifies

Like a food chain, the big firms have clearly identified easy targets to raid whenever they fall short of techies. In particular, software developers at top banks are well scouted and offered better remuneration as well as employment terms by telecom companies.

Safaricom’s hiring spree

Kenya’s leading telecommunication Safaricom Plc is now among the top domestic firms leading talent raids, owed to its massive financial muscles that allow it to outbid other employers. This is significantly influencing trends, demand, and movement of techies.

In September alone, Safaricom poached 10 software developers from I&M Bank at once, throwing the lender’s technology division into disarray.

I&M Bank, which is known for running a robust internal tech training programme for the better part of three years, has mainly been getting fresh tech specialists from Equity Bank and Co-operative Bank. Other recent Safaricom recruits have also transitioned from Kenya Revenue Authority (KRA), KCB Bank, Co-operative Bank, and Equity Bank.

Tech is mainly dominated by young people so they easily move.

Safaricom, which has hired over 400 software developers this year, is expected to intensify its calibre hunt to help stabilise operations in its recently launched Ethiopia subsidiary. It will require more techies to run its highly digitised business units as it works on a deal to roll out mobile money service in Ethiopia.

“Demand [for techies] in the country remains high. As part of our strategy, we are transitioning into a digital company, which means that we are developing more apps and digital platforms,” George Njuguna, Safaricom’s director of information technology tells the Africa Report.

Safaricom pays basic software engineers a starting salary of about KSh150,000 ($1,233), slightly higher than the average of the local firms yet way below what multinationals would offer in Kenya.

Multinationals have the upper hand

Big-pocketed multinationals also snap up the best human assets in the market. US tech giants like Microsoft, Amazon, and Google have established their hubs in Africa to strengthen the surging digital economy and internet demand.

In April 2022, Google set up its first ever Africa product development centre in Nairobi, following in the footsteps of Microsoft’s Africa Development Centre (ADC), which was launched in 2019.

“We also see the arrival of global tech players who have set up local developer centres in the country, and more activity from tech and fintech startups. All these are contributing to continued demand for developers,” says Njuguna.

To minimise interruptions caused by massive talent drain, firms such as I&M Banks, KRA, and Safaricom, have opted to harness their technology programmes. Safaricom Plc, for instance, is targeting to up-skill more than 1,000 techies in collaboration with other 30 organisations, comprising 14 training partners and five tech-hubs.

However, with the talent war leading to better packages for Kenya’s techies, local banks and enterprises still face the double challenge of recruitment and retention.

Last month, KRA announced it was revising workers’ pay to “attract, retain and motivate competent staff” as the market demands. It fell short of recruiting the targeted 2,196 new staff by June 2022. “The Authority would like to review its compensation package with a view to determine competitive remuneration to its staff,” says KRA.

Business leaders and top management must also understand the tech aspects to handle interruptions because these people [tech staff] are bound to shift

In the current fiscal year ending June 2023, the tax agency is planning to hire 2,203 new staff, part of which will be instrumental to its new technology and innovation department launched early this year. 20 new staff are said to have so far joined the technology department in the past two months – mainly drawn from tech startups and banks – to help KRA handle its new systems.

Start-ups at the bottom of the chain

It is the little-known Kenyan start-ups, such as Cuberise Market, Wasoko, and Twiga Foods that struggle the most to keep up with the incessant hunt of calibers.

As the talent grapple escalates, local small firms are going through a rough patch.

Some Kenyan tech start-ups like Sky Garden, Kune Foods, Notify Logistics, and WeFarm have either shut down or slashed workforce in the past four months, citing high operation costs, tough market conditions, and challenges in scaling up.

“Tech is mainly dominated by young people so they easily move. Almost 80% go when new opportunities emerge, especially in big firms where they handle just specific roles unlike in small companies,” says Samuel Baraza, a tech expert and CEO of Cuberise Market, a Kenyan e-commerce platform which delivers fresh farm produce to consumers and kiosks.

“Business leaders and top management must also understand the tech aspects to handle interruptions because these people [tech staff] are bound to shift.”

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