Bankers Stay Home as South Africa Inc. Prepares Return to Work
by BloombergInvestec Chief Executive Officer Fani Titi saw a sign of things to come when he dropped by the bank’s headquarters last week.
The usually buzzing escalators that criss-cross the four-story building in Sandton, South Africa’s business capital, were eerily silent. He was one of only 440 employees in an office block normally occupied by 10 times that number.
Two months after shutting down the economy to contain the spread of the coronavirus, South Africa’s government is preparing to ease restrictions that will enable an extra 8 million more workers to return to their jobs. As manufacturers, miners and industries prepare their factories and offices to receive their employees, banks have found there’s no need to immediately go back.
“We have established that we can work very effectively from outside of the building,” Titi said in an interview. “In the fourth quarter of the year we may see an increase. But I don’t think we’ll ever get back to a situation where you will have approximately 95% of your people in one place.”
President Cyril Ramaphosa on Sunday said the government will allow most industries to reopen June 1, a month after he began relaxing one of the world’s strictest lockdowns to revive a rapidly shrinking economy. Business leaders have warned that unless he moves quickly, 4 million could lose their jobs.
Much of Ramaphosa’s plan hinges on what regulations his administration puts in place, at a time when it’s come under criticism for some of rules that have been labeled baffling and nonsensical. Legislators are grappling with the plans just as the country goes into winter, when models suggest Covid-19 most easily spreads.
Read: South Africa Reopens Economy Despite Surge in Virus Cases
The need to reopen is urgent for manufacturers like glass-maker Consol Glass Pty Ltd. It warned last week the industry faces collapse because of lockdown regulations that ban the sale of alcohol, which accounts for 85% of the country’s biggest producer’s sales. Ramaphosa said that limited sales for home use will be allowed to resume from June 1, although bars, restaurants and sporting venues will remain banned.
Drink, Drugs
The 76-year-old firm is fully stocked to start supplying customers as soon people can buy beer, wine and spirits again. Moving stock would also enable Consol to keep its furnaces open — shutting them down would mean a six-to-eight month wait to restart and require international expertise to fire them up again.
Other businesses like Africa’s biggest drugmaker, Aspen Pharmacare Holdings Ltd., have been allowed to keep plants open during the shutdown, but their sea-facing head office in the resort South African town of Umhlanga is empty. As the nation eases restrictions, Aspen will see whether it will have to close factories completely should anyone catch Covid-19. That contrasts with its European operations, where the the company doesn’t have to shut facilities if an employee is infected.
“How government asks us to manage those challenges is key,” CEO Stephen Saad said. “Hopefully we get pragmatic solutions.”
Read more: South Africa Drink Makers Puzzle on How to Ease Alcohol Ban
Retailers have already taken steps to keep staff and customers safe, such as using signs to warn customers they aren’t allowed to enter shops without masks. Social distancing is enforced by allowing only every second cashier to operate, and areas are demarcated where people should stand when queuing.
Stores will face challenges when regulations are relaxed, said Graham O’Connor, CEO of grocer Spar Group Ltd.
Hot Meals
“I am nervous about the opening of liquor, cigarette and hot-meal sales because of the crowds that will come, but we are planning accordingly,” he said. “The stores have been deep-cleaned, we have sanitizer as you go in and our staff have the right equipment.”
State-owned power utility Eskom Holdings SOC Ltd., deemed an essential service, has had more than a third of its staff working at facilities since the lockdown started on March 27.
“The environment in which they work gets disinfected and deep-cleaned regularly,” Eskom said in an email. “This will not change post the lockdown.”
Banks were allowed to keep branches open throughout the lockdown. Like Investec, rivals including Nedbank Group, Absa Group and FirstRand Ltd. all expect to keep most staff home when restrictions ease. Standard Bank Group’s offices in downtown Johannesburg, which typically holds 16,000, only has 3,000 essential workers on site.
To smooth the transition to working remotely, Investec introduced virtual Friday night get-togethers. One session was joined by a celebrity soccer player, and another involved a team member playing guitar and a harmonica as others sipped whiskey.
Still, the change has come with challenges, Investec’s CEO said.
“The psychological toll on people has been significant,” Titi said. “The idea of being locked in a room at home without contact with people and without the kind of interaction that Investec naturally is prone to has been a difficult experience.”
Bloomberg
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