Local manufacturing output has increased by 3.4% year on year, according to the Manufacturing: Production and Sales report recently released by Statistics South Africa. While this is a step in the right direction following a protracted spell of subdued activity, it is now more important than ever to adopt new technologies to help boost the sector’s productivity, especially with the International Monetary Fund predicting real Gross Domestic Product (GDP) growth at only 0.1% this year.

This is according to Mandla Gqada, Solutions Architect and Engineering Lead at MakwaIT Technologies  who explains that research has found a direct and positive correlation between the productivity and efficiency of South African manufacturing firms and the application of technological innovation. “In fact, companies that harness technology in their processes experience a 900% increase in labour productivity.”

Additionally, a paper by McKinsey titled The Future of Work in South Africa: Digitisation, Productivity, and Job Creation, has shown that accelerated adoption of digital technologies could triple the country’s productivity growth, more than double growth in per capita income, and add more than a percentage point to the real GDP growth rate over the next decade. It could also result in a net gain of 1.2 million jobs by 2030. For this to become a reality, Gqada believes that, as South Africa’s fourth largest sector, the manufacturing industry must be at the forefront of digital transformation.”

“Despite contributing 12% to GDP pre-pandemic and playing a pivotal role in driving the country's economic growth, the manufacturing sector’s true potential has been impeded by its reluctance to fully embrace and integrate new technologies. Investment in digital transformation by local firms is therefore key for ramping up output and, in turn, the South African economy,” he concludes.