Why SA jobs are be­ing de­stroyed The sixth edi­tion

Finweek English Edition - - INSIGHT: LOCAL -

The job out­look in our coun­try is a wor­ri­some one. One in four South Africans is un­em­ployed – al­though it is es­ti­mated that the fig­ure may be as high as one in three as the num­ber of dis­cour­aged job­seek­ers in South Africa has in­creased by 1.1m since 2009. Dis­cour­aged job­seek­ers are peo­ple who have given up hope of find­ing a job. To­day, around 68% of th­ese peo­ple in SA are un­der the age of 35. Many of them have come from a ba­sic school ed­u­ca­tion sys­tem that has left them with rudi­men­tary skills and with­out the means of gain­ing ac­cess to fur­ther ed­u­ca­tion. It has also meant a grow­ing re­liance on so­cial wel­fare; cur­rently four out of 10 South African house­holds are de­pen­dent on wel­fare pay­outs. The grow­ing sense of un­ease and hope­less­ness has al­ready con­trib­uted to sev­eral vi­o­lent protest ac­tions across the coun­try, and ques­tions have to be asked about what the Govern­ment is do­ing to ad­dress this is­sue, aside from ac­tion al­ready be­ing taken in the ed­u­ca­tion space.

of the De­vel­op­ment In­di­ca­tors Re­port (DIR), which cov­ers the year 2012, was re­leased by Min­is­ter in the Pres­i­dency Collins Cha­bane on 20 Au­gust. The re­port tracks the progress in im­ple- ment­ing Govern­ment’s poli­cies and pro­grammes. It shows that while SA is in a bet­ter space in many ar­eas than 20 years ago, some is­sues of con­cern jump out, mainly re­lat­ing to high lev­els of un­em­ploy­ment and the in­creas­ing lev­els of house­hold debt.

Harold Maloka, spokesper­son for the pres­i­dency, says that the high level of un­em­ploy­ment is a ma­jor con­cern for Govern­ment, along with poverty and in­equal­ity. “Re­duc­ing un­em­ploy­ment is a main fo­cus area of the National De­vel­op­ment Plan (NDP), and var­i­ous ini­tia­tives are be­ing im­ple­mented to re­duce un­em­ploy­ment, in­clud­ing the in­fra­struc­ture pro-

gramme, the New Growth Path sec­tor de­vel­op­ment ini­tia­tives, and a va­ri­ety of in­dus­trial de­vel­op­ment pro­grams un­der the In­dus­trial Pol­icy Ac­tion Plan (IPAP).”

Govern­ment is us­ing its State-owned en­ti­ties, like Transnet and Eskom, to em­ploy thou­sands of peo­ple, and while th­ese pro­grammes are com­mend­able, they do, how­ever, also in­crease the pub­lic-sec­tor wage bill, which is al­ready sit­ting at al­most 40% of national GDP or around R400bn per year. The long-term af­ford­abil­ity of this plan there­fore, has to be a con­cern, and em­ploy­ment by the pri­vate sec­tor should rather be en­cour­aged. How­ever, this has been dis­as­trous of late.

Min­ing and agri­cul­ture re­main two key sec­tors of the South African econ­omy, with the po­ten­tial to em­ploy a sub­stan­tial num­ber of peo­ple, mostly un­skilled. Yet in re­cent years, em­ploy­ment num­bers in both sec­tors have plum­meted dis­as­trously.

Due to the fact that the the size of the min­ing in­dus­try shrank by 1% per an­num be­tween 2001 and 2008, it now em­ploys some 300 000 fewer peo­ple than it did in 1994. A great deal of labour un­rest, in­clud­ing the tragedy at Lon­min’s Marikana mine in Au­gust 2012, as well as con­tin­u­ing un­cer­tainty over key Govern­ment poli­cies, has led to un­par­al­leled lev­els of un­ease in the sec­tor. This in turn leads to a lack of in­vest­ment and grow­ing job in­se­cu­rity.

Ac­cord­ing to the DIR re­port, jobs in agri­cul­ture fell from 1.1m in 2002 to lev­els of 660 000 just 10 years later. The num­ber of work­ers in this sec­tor has ef­fec­tively halved. To a large ex­tent, this can be blamed on grow­ing in­put costs and Govern­ment leg­is­la­tion.

Theo de Jager, deputy pres­i­dent of AgriSA, says that one piece of Govern­ment leg­is­la­tion that is hugely pro­hib­i­tive for job cre­ation in farm­ing has been the ex­tended se­cu­rity of ten­ure act.

“It’s a crim­i­nal of­fence to have work­ers re­moved from your farm, and to­day it can only be done with a court or­der and those cost around R16 000 per case. If they’re here, they’re here, even if they are not con­tribut­ing. Un­for­tu­nately, bad ap­ples of­ten lead to good work­ers leav­ing your em­ploy.”

De Jager says that this is­sue has in many in­stances led to farm­ers not em­ploy­ing new work­ers and down­siz­ing the ex­ist­ing num- ber of work­ers.

“An­other huge is­sue is in­put costs. Elec­tric­ity and wa­ter costs as well as in­crease in wages have had a mas­sive im­pact. We’ve lost en­tire in­dus­tries in SA in­clud­ing the tea (ex­clud­ing rooi­bos) in­dus­try. In 2006, we had big tea plan­ta­tions go­ing on here in the Tza­neen area that em­ployed 12 500 peo­ple. SA has since lost the in­dus­try to coun­tries like Tan­za­nia and Malawi.”

What’s worse is that the jobs bleed in this sec­tor is sure to in­crease as a re­cent re­vi­sion of the ba­sic min­i­mum farm wage by the Depart­ment of Labour has seen ba­sic wages be­ing in­creased from R69/day to R105/day.

“This may mean that even more farms start to grow pro­duce that re­quires less labour, to cur­tail the cost in­creases. Smaller farm­ing op­er­a­tions may also strug­gle to make ends meet,” De Jager says, adding that the com­bi­na­tion of new leg­is­la­tion and high in­put costs has led to farm­ers mov­ing away from labour-in­ten­sive farm­ing. “It’s not easy to cre­ate jobs on farms and it’s get­ting in­creas­ingly more dif­fi­cult to main­tain the jobs that ex­ist.”

He claims the agri­cul­tural in­dus­try can cre­ate 1m jobs in one year un­der the right con­di­tions.

“Ba­si­cally, all we’ll need is the per­mis­sion to fire work­ers that are not de­liv­er­ing. If farm­ers abuse that al­lowance, there are pro­cesses in the law that Govern­ment can use to ad­dress those in­stances, but the way we’re go­ing, we’ll strug­gle to see mass em­ploy­ment.”


In­stead of mak­ing it eas­ier to em­ploy peo­ple, Govern­ment seems in­tent on adding to the un­cer­tainty in the labour mar­ket with new pro­posed leg­is­la­tion. At least three new par­lia­men­tary bills cur­rently in the sys­tem may have huge neg­a­tive im­pli­ca­tions for un­em­ploy­ment.

One of th­ese is the Labour Re­la­tions Amend­ment Bill (LRA). The bill – of which a fi­nal draft has just been en­dorsed by par­lia­ment – ad­dresses labour bro­ker­ing is­sues by lim­it­ing the pe­riod for which work­ers can be em­ployed to three months. It also ad­dresses or­gan­i­sa­tional rights for unions that do not en­joy ma­jori­tar­ian sta­tus at a work­place, and looks at an ex­ten­sion of the pe­riod for con­sul­ta­tion over pro­posed re­trench­ments and the re­moval of the re­quire­ment for a strike bal­lot to take place prior to in­dus­trial ac­tion.

The op­po­si­tion DA says that this bill is solely meant to pan­der to the needs of the ANC’s fel­low tri­par­tite mem­ber Cosatu. Cosatu has of late strug­gled to be the ma­jor­ity union in some sec­tors of the econ­omy like the plat­inum in­dus­try, where the As­so­ci­a­tion of Minework­ers and Con­struc­tion Union (AMCU) has taken top spot af­ter the Marikana af­fair. This bill may ad­dress this is­sue in a man­ner of speak­ing, giv­ing more rights to Cosatu aff il­i­ates like Num that are no longer ma­jor­ity unions. Cosatu has also been ve­he­mently op­posed to labour bro­ker­ing in SA and would be in favour of the pro­posed changes.

The South African Cham­ber of Com­merce and In­dus­try (SACCI) says that the pro­pos­als in the bill per­tain­ing to the re­stric­tion on labour bro­ker­ing “will def­i­nitely re­sult in job losses”.

Peggy Drod­skie, COO of the SACCI, com­ments: “Many jobs are of a tem­po­rary na­ture, such as when there is sea­sonal de­mand for in­creased staff or [when the po­si­tions] are pro­ject re­lated. Many projects last for more than three months, and the re­stric­tion on the em­ploy­ment of tem­po­rary staff for a pe­riod not ex­ceed­ing that time is un­re­al­is­tic. Some op­er­a­tions are sea­sonal, and it is im­prac­ti­cal to ex­pect an em­ployer to keep staff on the pay­roll if their ser­vices are re­quired on a sea­sonal ba­sis. Some in­dus­tries have un­cer­tain staff re­quire­ments. As an ex­am­ple, the fish­ing

Collins Cha­bane

Newspapers in English

Newspapers from South Africa

© PressReader. All rights reserved.