The govern­ment, busi­ness and labour will con­vene for a two-day sum­mit this week to fo­cus on SA’S unem­ploy­ment cri­sis.but it’s un­clear if the meet­ing will bear any prac­ti­cal fruit

Financial Mail - - FEATURE - Theto Mahlakoana mahlakoanat@busi­nesslive.co.za

There is wide­spread cyn­i­cism about how much the pres­i­den­tial jobs sum­mit this week will help SA’S unem- ploy­ment cri­sis. The meet­ing on Thurs­day and Fri­day will bring to­gether busi­ness, labour and the govern­ment to dis­cuss “col­lab­o­ra­tive and high-im­pact in­ter­ven­tions to drive job cre­ation, job re­ten­tion and eco­nomic growth”, seek­ing a way out of poverty for the 9.6-mil­lion South Africans who are un­em­ployed.

Un­der­stand­ably, an­a­lysts and economists have adopted a wait-and-see ap­proach, ques­tion­ing the tim­ing of the sum­mit and ask­ing what pre­vi­ous gath­er­ings of the kind have achieved.

The sum­mit has been a long time in the mak­ing. It was an­nounced by Pres­i­dent Cyril Ramaphosa dur­ing his maiden state of the na­tion ad­dress in Fe­bru­ary, but trade union fed­er­a­tion Cosatu has been call­ing for such a gath­er­ing since former pres­i­dent Ja­cob Zuma took of­fice in 2009. It now comes just a few months be­fore next year’s elec­tions, when the ANC will need Cosatu’s sup­port to clinch vic­tory.

Labour con­sul­tant Tony Healy says the pol­i­tics around the elec­tions will weigh heav­ily on the sum­mit and could mil­i­tate against the nec­es­sary de­ci­sions be­ing made.

These, he says, in­clude rad­i­cal re­form of the reg­u­la­tory en­vi­ron­ment for busi­ness, in­clud­ing a re­view of labour reg­u­la­tions to make it eas­ier for more peo­ple to be ab­sorbed into the labour mar­ket by ex­ist­ing busi­nesses.

“A lot of the changes that need to be made will be po­lit­i­cally un­pop­u­lar,” says Healy. “Gen- eral reg­u­la­tion is be­com­ing more com­plex; ac­cess to cap­i­tal is be­com­ing more dif­fi­cult; the govern­ment it­self is over­in­flated as an em­ploy- er, which is a prob­lem … The tim­ing couldn’t be worse for this sum­mit in terms of de­ci­sions that have to be made.”

Ann Bernstein, ex­ec­u­tive di­rec­tor of the Cen- tre for De­vel­op­ment & En­ter­prise, says the unem­ploy­ment cri­sis re­quires bold ac­tion, not just projects. She says the sum­mit will be a “wasted op­por­tu­nity” if it does not deal with the key struc­tural con­straints on em­ploy­ment, in­clud­ing rigid labour laws.

“Too much en­ergy goes into projects that can help move peo­ple closer to the front of the unem­ploy­ment queue, and too lit­tle goes into the pol­icy re­forms that are needed to shrink those queues,” says Bernstein. “We need to change the ap­proach to col­lec­tive bar­gain­ing so that work­seek­ers and smaller firms are not priced out of the mar­ket; re­duce the cost of em­ploy­ing young peo­ple, es­pe­cially in com­par­i­son with older, more ex­pe­ri­enced work­ers; and re­duce sub­si­dies be­ing paid to firms that are cap­i­tal- and skillinten­sive.”

But del­e­gates to the sum­mit may be squar­ing up for a stale­mate. Cosatu and other labour fed­er­a­tions have al­ready de­clared they won’t en­ter­tain talk of leg­isla­tive re­form.

Cosatu spokesper­son Sizwe Pamla says: “We are go­ing to re­ject that the en­vi­ron­ment must be dereg­u­lated. It will never work in SA. What that does is al­low em­ploy­ers to fire South Africans and re­place them with for- eign na­tion­als be­cause you al­low them to be flex­i­ble with de­ci­sions per­tain­ing to pay and other con­di­tions.”

The fed­er­a­tion will make its sub­mis­sion to the sum­mit along with the Fed­er­a­tion of Unions of SA (Fe­dusa) and the Na­tional Coun­cil of Trade Unions, which are also part of the Na­tional Eco­nomic De­vel­op­ment & Labour Coun­cil (Ned­lac). The three fed­er­a­tions agree that solv­ing the unem­ploy­ment cri­sis re­quires, among other things, a greater fo­cus on ru­ral and town­ship economies, par- tic­u­larly the cre­ation of labour-in­ten­sive in­dus­tries in these ar­eas.

Fe­dusa gen­eral sec­re­tary Den­nis Ge­orge says: “The ru­ral ar­eas are very im­por­tant and also the town­ship econ­omy, be­cause that is where the peo­ple are. How do we sup­port the town­ship busi­nesses? You know how the for­eign­ers came in and took over? The same thing is hap­pen­ing in agri­cul­ture in ru­ral ar­eas. We need to ad­dress these prob­lems.”

Ge­orge, who sits on the pres­i­den­tial sum­mit com­mit­tee com­pris­ing govern­ment, labour, busi­ness and com­mu­nity lead­ers, says the com­mit­tee is work­ing on pro­pos­als that deal with sec­tor-spe­cific in­ter­ven­tions, SME sup­port, ed­u­ca­tion and skills, in­clu­sive growth, trans­for­ma­tion and in­equal­ity, among other things.

The pro­pos­als arise from the work of five work­ing com­mit­tees, but Cosatu’s big­gest af­fil­i­ate, the Na­tional Ed­u­ca­tion, Health & Al­lied Work­ers’ Union (Ne­hawu), has ac­cused the govern­ment and busi­ness of not be­ing com­mit­ted to the process.

Ne­hawu gen­eral sec­re­tary Zola Saphetha says the work­ing groups have made lit­tle progress due to “lack of con­sen­sus and com­mit­ment on the most far-reach­ing is­sues that have po­ten­tial to de­liver on de­cent jobs”.

He says big busi­ness is “re­fus­ing” to in­vest and cre­ate jobs in strate­gic sec­tors of the econ­omy, while the govern­ment is plan­ning to re­trench about 30,000 work­ers in the pub­lic ser­vice.

“[The govern­ment] is not pre­pared to fill crit­i­cal va­cant posts, there is no at­tempt to deal with aus­ter­ity mea­sures and cut­backs that are weak­en­ing the pub­lic ser­vice,” he says. “The quest to build a ca­pa­ble devel­op­men­tal state has been rel­e­gated to the back burner.”

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