It takes an average of eight years to produce an actuary

Of the 2.1 million people employed in South Africa’s formal finance sector in the third quarter of last year*, actuaries constituted less than 0.1%. This is because there are less than 2 000 actuaries in South Africa, most of whom are members of the Actuarial Society of South Africa (ASSA).

An actuary is either an Associate Member of ASSA (AMASSA) or a Fellow of ASSA (FASSA). Student members and technical members are not actuaries and may not use this title.

In an environment where demand for actuarial skills significantly exceeds supply, the unemployment rate for South African actuaries is zero, according to Mike McDougall, CEO of ASSA. Compounding the shortage in South Africa is the emigration of actuaries to countries trying to meet their own growing requirements. ASSA’s membership statistics show that last year some 25 South African actuaries took up employment opportunities outside of South Africa.

McDougall says the demand for actuaries is not unique to South Africa. The United States Bureau of Labor Statistics**, for example, predicts a 24% growth rate in the employment of actuaries in the US from 2020 to 2030, which far exceeds the growth expectations for all other professions.

South Africa nevertheless ranks among the countries with a high number of actuaries, with the United States (US) and the United Kingdom (UK) the only countries in the world with more than 10 000 actuaries. ASSA is one of the 10 largest actuarial associations in the world and the largest on the African continent.

McDougall explains that the actuarial qualification is one of the toughest to obtain, whether in South Africa or abroad. In 2010, ASSA introduced a homegrown actuarial qualification, which meant that actuaries no longer had to turn to the UK for their actuarial qualification.

Approved by the International Actuarial Association (IAA) as a primary qualification, the South African qualification is as difficult to obtain as those offered by professional bodies in other countries, adds McDougall. He explains that once a student member has graduated from university with a degree in Actuarial Science, it takes a minimum of three years to complete the additional requirements to become a Fellow of the Actuarial Society of South Africa (FASSA).

However, most student members take at least eight years to pass the required 13 technical skills exams and complete the required work-based learning under the supervision of a mentor.

Transforming the profession

While a consistent focus on transforming the South African actuarial profession is showing results, the progress is painfully slow because it takes almost a decade to produce an actuary.

Actuarial Society of South Africa Membership Figures – Fellows

In 1998, a mere 2.2% of Fellows were African, Coloured and Indian. Today, 24 years later, this has increased to 25%, which means the number of African, Coloured and Indian Fellows is growing at an annual rate of 20%. By comparison the total number of Fellows is growing by an average of 6% a year. While we acknowledge that the transformation of our profession is slow, we are encouraged that the Society’s many transformation initiatives are beginning to make a difference.

Students who come from disadvantaged backgrounds and who did not grow up with English as their first language face significant hurdles on their path towards achieving Fellowship.

The journey to becoming a Fellow member of ASSA consists of several stages:

1. Student members are expected to pass three foundation and four core technical skills exams and complete basic professionalism training in order to achieve the Technical member of ASSA (TASSA) designation.
2. A TASSA becomes an Associate member of ASSA (AMASSA), also known as a generalist actuary, on completion of the remaining general skills exams, further professionalism and business skills training and two years of work-based experience.
3. In order to qualify as a Fellow member of ASSA (FASSA), which is the apex qualification, members choose a primary and secondary area of specialisation. They must pass another set of technical skills exams and complete more professionalism training and a further year of work-based learning. Members who select risk management as their secondary area of specialisation also gain the Chartered Enterprise Risk Actuary (CERA) designation.

The table below provides an overview of the demographics of each of the four ASSA membership categories:

Strong pipeline of potential actuaries

When looking at the pipeline of potential actuaries, by next year the number of black African student members and Technical members is likely to surpass the number of white members on the road to becoming actuaries.

Actuarial Society of South Africa Membership Figures – Pipeline (Associate, Technical and Student members)  

With the aim of helping struggling student members achieve their qualifications, the Actuarial Society Academy was established in 2016. The Academy provides working student members with educational support as well as soft skills training such as communicating in a corporate environment, balancing work and studying, and coping with the demands of the workplace.

Mike McDougall is CEO of the Actuarial Society of South Africa.