Quarter of CBZ's workforce, totaling 347 employees, now find themselves unemployed following the bank's decision to let them go.
Downsizing at CBZ Bank: The Impact of Digital Transformation
The banking sector in Zimbabwe has recently witnessed a creative shake-up, with CBZ leading the charge by shedding 347 employees out of a total workforce of 1,448. This move follows a "restructuring exercise" initiated back in October last year, indicating a longer-term approach to modernization.
While the affected employees' roles are yet to be pinpointed, it's a known fact that many corporations in Zimbabwe lean heavily towards management positions. Critics often argue that these organizations frequently let go of lower-tier staff while maintaining high-paying management roles, making the restructuring process less impactful.
In a statement issued over the weekend, CBZ addressed the retrenchment:
The recently unemployed CBZ employees are now facing slim prospects of finding work in the formal sector, given Zimbabwe's pervasive unemployment and economic straits. The timing couldn't be worse, as other major employers are also scaling down or closing shop, resulting in an intensifying competition among job-seekers.
Many of these former CBZ employees might find it challenging to adapt to the digital economy, especially given Zimbabwe's underdeveloped technology sector.
The loss of secure employment will likely force many into the informal sector, where income stability is unpredictable, and earnings are typically lower than their banking salaries.
Financial institutions in Zimbabwe have not escaped the country's economic downturn over the past couple of years, mainly attributed to ineptness from the government, particularly in matters of currency and inflation.
Banks are turning to digital channels to cut costs and boost efficiency. A single digital platform can handle countless transactions traditionally managed by multiple tellers. Centralized operations eliminate redundancies across branches.
The rise of AI-powered chatbots in recent years further reduces the need for extensive call center teams.
Enrichment Insights:- Employment trends: Since 2000, the banking sector in Zimbabwe has experienced a 75% decrease in employment, with CBZ Bank accounting for a significant portion of recent layoffs.- Technological advancements: The primary cause of these job losses is digital transformation and automation. Technologies like GenAI are taking over certain roles, necessitating employees to acquire new skills to stay employable.- Impact of digital transformation: The shift towards digital banking services necessitates reskilling and upskilling within the workforce. As banks migrate to more efficient digital platforms, traditional roles are replaced, leading to increased retrenchments.- Reskilling initiatives: In response, the National Employment Council (NEC) for the Banking Sector has proposed establishing an academy to reskill employees, aimed at equipping them with the skills required for the current digital landscape, potentially reducing future job losses.
In essence, the banking sector in Zimbabwe, particularly CBZ Bank, finds itself in the midst of significant transformation spurred by technological advancements. Despite this turmoil, there are initiatives in place to reskill and upskill workers to navigate the evolving landscape.
The digital transformation at CBZ Bank, as a part of the banking sector's shift towards efficiency, has consequently led to the shedding of positions in business operations, likely affecting lower-tier employees. In an effort to stay relevant in the modern finance sector driven by digital channels, it is essential for affected employees to acquire new skills and adapt to the rapid advancements in technology, such as AI and chatbots.
