Demand for actuarial resources in South Africa

Abstract

A key thrust of the Actuarial Society of South Africa’s strategic plan is to promote diversity in actuarial demography. The aim is that the membership profile of the actuarial profession increasingly reflects the demographic profile of the country.More broadly, it is useful for a profession to consider how it has evolved, and how changes in the environment in which it operates may affect demand for its services in the future. In the last few years, as a result of economic development and growth in the services sector, as well as changes in the financial and insurance environment, including regulatory and technological developments as well as social and demographic changes, the demand for actuaries in South Africa has grown significantly. South Africa faces a number of challenges, such as a poorly educated workforce with high levels of unemployment and skills shortages. Poor socio-economic conditions for a large majority of the population result in high crime levels and emigration of skilled workers—a negative spiral. These are all interrelated and all affect economic growth and the demand for actuaries. While deterioration in these conditions negatively affects demand, global developments, such as international accounting standards and Solvency II, are creating demand. At the same time, emigration of actuaries and actuarial students creates shortages and a much tighter actuarial resource market. This paper covers the current demographics of the membership of the Actuarial Society of South Africa, factors affecting demand, the results of research performed among South African employers of actuarial resources and models developed for projecting future demand. The models indicate moderate growth in demand in the short term.