This study is concerned with the efficacy of the Skills Development Act in promoting skills development and training in South Africa. Skills development and training was examined in the context of the 30 manufacturing companies and 20 retail companies based in Pietermaritzburg. Firstly, the literature study provided a foundation on which to base the idea that skills development and training is vital in order for a country to achieve economic success. Secondly, efforts of other countries in promoting skills development and training were examined. Thirdly, skills development and training was examined in the South African context. The literature study lent support to the idea that there is a need for skills development in South Africa, considering factors such as HIV/AIDS, the shortage of scarce skills and labour demand trends in the South African labour market and the South African economy. The field study involved the use of questionnaires to gather data from the respondents. The results of the field study were group into pre-defined variables. The variables were then correlated and hypothesis testing was conducted to test the relationship between the variables. The main conclusions of the study are based on the hypothesis testing and the results of the field study and are detailed below. 1. The perceived effectiveness of the Skills Development Act was found to be a positive correlate of the effectiveness of training, the application of effective training procedures, the percentage of employers conducting formal training and the percentage of training costs recovered from the SETAs. 2. Training was perceived to be effective in terms of employee learning, employee performance and organizational performance. 3. There was an even split between companies that applied effective training procedures and those that did not. 4. Compliance with the Act was a pre-requisite for selection of the sample, however full participation in the Act was found to be lacking in general. This means that the majority of companies in the sample did not submit Workplace Skills Plans and Implementation of Training reports. 5. Compliance with the Skills Development Act was found to be a correlate of the application of effective training procedures, assistance received from the SETAs, the perceived effectiveness of training and the perceived effectiveness of the Skills Development Act. 6. It was generally perceived that the assistance received from the SETAs was poor. 7. On-the-job training was found to be prevalent in all companies; however formal training was more prevalent in companies that have a large number of employees. The average rate of formal training was calculated as 29.64%. 8. The number of employees was found to be a correlate of the percentage of formal training conducted, the percentage of training costs recovered from the SETAs, the perceived effectiveness of training and the application of effective training procedures.

Thesis (M.Com.)-University of KwaZulu-Natal, Pietermaritzburg, 2006.