Birches Group On-Site Visit to Lusaka, Zambia

We are pleased to announce that Birches Group will be in Lusaka, Zambia from July 22 to July 26, 2019!

On July 22, 2019 at the Hilton Garden Inn Lusaka, we will be conducting a series of round table meetings of different industries in Zambia to discuss compensation and benefits trends, practices, as well as findings from our Birches Group salary survey in Zambia, which is updated three times annually. This event will be co-sponsored by our strategic partner, CV People Africa.

We will also be meeting with target employers in Lusaka during the week. For more information, please contact us.

This is a wonderful opportunity to meet with peers and share information about the challenges of human resources in Zambia.

Birches Group Announces Strategic Partnership with CV People Africa Zambia Limited

Birches Group is pleased to announce another strategic partnership, this time with CV People Africa Zambia Limited based in Lusaka, Zambia. CV People Africa Zambia provides professional, smart and innovative talent acquisition and recruitment services to its clients since its establishment in 2014. With clients from various sectors in the country, CV People Africa Zambia holds the most extensive network of individuals knowledgeable in areas related to Human Resources, Information Communications Technology, and Manufacturing to name a few.

Under this partnership, CV People Africa Zambia will co-sponsor our multisector survey and help promote survey participation to all their clients. We will also be exploring possible compensation management training events, webinars and other activities to provide professional development opportunities for HR practitioners in Zambia.

In commenting on the partnership, Nchimunya Chigwedere, the Executive Director of CV People Africa Zambia, said “Through this strategic partnership CV People Africa and Birches Group will be providing the Zambian market with quality compensation management solutions that will enable organizations to make informed decisions which will directly impact their productivity. We have found a partner whose products and services not only provide solutions for our clients but also enhance our current product offerings.”

Bianca Valencia, Networks and Partnerships Specialist for Birches Group, added: “Through our partnership with CV People Africa Zambia, we hope to engage and inform as many HR practitioners in the country about the advantages of our products and services. To be able to work with CV People Africa Zambia is a perfect fit as they have the extensive network in the country, while we provide tried and tested solutions for dynamic markets such as that of Zambia.”

Download the press release here.

Managing Compensation in Zambia during Turbulent Times

Employers in Zambia are facing challenges to remain competitive during the turbulent economic conditions that have emerged since July, 2015.  During the last 12 months, the Zambian Kwacha has lost 45% of its value versus the US dollar, while copper prices (the most important commodity for the country) have plunged globally.  Inflation has also been high, around 23% on an annualized basis.

Zambia Fx Rate

 

During the same period, what actually happened in the labor market?  Data from the Birches Group multisector survey shows the following pay movement, compared to inflation:

Zambia Market Movement

As you can see, employers moved salaries up around 17%, close to but not equal to inflation.  This is typical, as employers try to keep a cap on fixed costs during the crisis, while still needing to retain and motivate staff.

How Should Employers Respond?

Employers need to respond to their employees when asked, “What will the company do for me?” under these volatile economic conditions.

In March, 2016, Birches Group conducted a Pulse survey of Zambian employers to assess their response to the crisis.  Here is what we found:

  • Local currency payments.  All but one of the employers surveyed reported they are continuing to pay local employees in local currency.  This is consistent with good compensation management practice.
  • Extraordinary adjustments.  Forty-five percent of employers surveyed indicated they had granted an out-of-cycle, extraordinary pay increase, averaging 17.3%, in the last six months; an additional nine percent expect to grant an extraordinary increase in the next six months.
  • Temporary allowances.  Eighteen percent granted a temporary adjustment to help compensate staff for increases in the cost of basic goods.

Best Practice

Interim adjustments, temporary pay increases and other ad-hoc steps are good steps to address employee concerns, but may not be the most effective way to manage compensation in a market-driven way.

Birches Group recommends a policy-based approach to managing staff salaries during volatile economic periods.  A “Special Measures Policy” which outlines the triggering conditions which must be present in the market, and the specific actions an employer will take when such triggers are reached, is the most effective way to address employee concerns while still maintaining a market-driven pay philosophy.  Together with frequent reviews of market trends, a Special Measures Policy serves both employers and employees well.

The Birches Group Solution

The Birches Group survey in Zambia is updated three times annually, in April, July and October.  Subscribers gain access for 12 months, allowing continuous monitoring of market movement.  Our Trends™ tool can also be utilized to help estimate market movement based on actual historical market data.

For more information about Birches Group surveys, please contact us.