tisation in the work place,” he adds.
Justin Froneman, an analyst for SBGS, said in a recent note that unions would become accustomed to accepting inflationlinked wage increases. This is notwithstanding NUM’s demands for a 60% increase for entry-level workers and a blended wage increase of in the high teens.
“We believe the new normal of moderate wage increases is fast becoming a reality and that further long strikes are futile and have the potential to destroy the viability of SA’s PGM sector,” said Froneman.
Another study from UBS suggested that in the long term, restructuring in the platinum and gold sectors in SA was inevitable.
According to Kane Slutzkin, an analyst for the bank, SA’s platinum sector is more productive than the gold industry but the deterioration of productivity has fallen in the last three years at a greater rate than in the gold sector. He believes either a massive ramp-up in mining activity, or the industry faces restructuring.
“In order to return to average productivity levels, we estimate … an increase in mining activity by 30%, which we see as highly unlikely, or reduce employment by 25%, a more likely scenario in our opinion, driven by the closure of unprofitable mines, although this is not without its challenges,” Slutzkin said in his note.
Roger Dixon, chairperson of SRK, a mining engineering consultancy, observed that productivity is bound to fall in these sectors owing to the maturity of the mines. “Transport to the more distant reef faces is getting longer, and it gets hotter as the mines become deeper, which affects productivity,” he said.
This is the challenge facing Mining Minister Susan Shabangu who in parliament earlier this week set down plans for “high level engagement” with mining industry leaders and unions in an effort to head off further civic misrule and restore the standing of SA in international markets.
There were no details on what may happen, but Shabangu, speaking in her Budget speech, couldn’t resist a dig at the industry saying: “The societal problem that was accentuated by Marikana, as well as several other related occurrences, ref lect that there have been glaring lapses in the implementation of our transformation too.”
She was referring to the Minerals & Petroleum Resources Development Act, promulgated in 2004 and due for amendment any day now. Shabangu believed mining companies had not done enough to enforce it.
“During this time (2004 to 2009), every other stakeholder suffered from a case of parochial amnesia in terms of their responsibility for the implementation of this transformation agenda, and we ended up with widely varied accounts on the extent, or otherwise of the progress,” she said.
A week earlier, Shabangu called on unions to join against the common enemy she termed “monopoly capital”, although as Investment Solutions head economist, Chris Hart, observed on Twitter: “There is no monopoly capital in the private sector. That i s t he domain of Eskom, Transnet etc…”