Ig­nore the unions at your peril

Finweek English Edition - - LAST WORD - BY MAMOKGETHI MOLOPY­ANE

Irecently at­tended a part­ner­ship break­fast ses­sion that aimed to build re­la­tion­ships be­tween the pri­vate and the public sec­tors. It was one of those events where pow­er­ful men and women pat one another on the back and com­mit to a f uture of col­lab­o­ra­tion, but the mo­ment they are out of the door, they mut­ter to their as­so­ci­ates: “There’s no way this will work.”

But that’s not what irked me most about the event. Dur­ing break­fast, as is so of­ten the case with South Africans, we got talk­ing about the state of the na­tion. And then some­one at our ta­ble made a com­ment about “South Africa’s ob­ses­sion with labour”.

The f irst point is that as a per­son in the busi­ness sec­tor, surely he should un­der­stand how the ac­tiv­i­ties of unions and their fed­er­a­tions oc­cupy the at­ten­tion of the economist, the politi­cian and the man on the street. In any econ­omy – de­vel­oped or de­vel­op­ing – labour is re­quired for the mak­ing of goods and the sup­ply of ser­vices. For politi­cians, es­pe­cially in the al­liance, wide­spread ire by Cosatu mem­bers, even in the fed­er­a­tion’s cur­rent weak­ened state, could mean the loss of sup­port they need for the elec­tion ma­chin­ery to func­tion.

The broader eco­nomic im­pact of an un­happy labour con­tin­gent has lon­glast­ing ram­i­fi­ca­tions. Three re­cent strikes had such an im­pact on the econ­omy: the 2006 se­cu­rity sec­tor strike, the month­long 2007 public sec­tor strike, and the record five-month-long plat­inum sec­tor strike in 2014, which was the long­est this coun­try has ever seen.

The im­pli­ca­tions of SA’s ob­ses­sion, as he put it, with labour, far out­strip the span of a col­umn. Even if we tried, we can’t ig­nore labour; they are a per­ma­nent thorn in the side of SA’s econ­omy − some­times ir­ri­tat­ing but not some­thing that can be ig­nored.

Con­sider the state of the pri­vate sec­tor: jobs are not fast com­ing; min­ing is on track to hav­ing one of the big­gest re­trench­ments across all its sec­tors in its history. SA’s work­ers can see how steeply busi­ness and its abil­ity to cre­ate jobs has de­clined.

Now let’s look at the public sec­tor, the coun­try’s big­gest em­ployer. Re­mem­ber that the bulging public sec­tor must be paid for with gov­ern­ment rev­enue, a dwin­dling re­source.

It would be foolish to for­get the might of the whip of unions on both gov­ern­ment and the pri­vate sec­tor. But if the cur­rent eco­nomic out­look con­tin­ues, SA is headed for a re­ces­sion, if we’re not al­ready in one.

Look­ing at how mat­ters may evolve over time, one won­ders if pri­vate sec­tor work­ers, whether they be­long to a union or not, can see that with­out com­pro­mises they may be forced to join the ranks of the un­em­ployed.

The bar­gain­ing power of work­ers in the public sec­tor looks sub­stan­tially dif­fer­ent. They’ve be­come a pow­er­ful po­lit­i­cal or­gan­i­sa­tion; they can shut down schools and hos­pi­tals, dis­rupt tax col­lec­tion and gov­ern­ment ser­vices. While the for­mer will have the public up in arms, the lat­ter two pos­si­bil­i­ties should fill gov­ern­ment with vis­ceral fear.

There is an over­ar­ch­ing point I want to make that tran­scends the mur­mur­ings of an ex­ec­u­tive about SA’s ob­ses­sion with unions. To think, no, to as­sume that unions and labour are merely so­cial or­gan­i­sa­tions f ight­ing for bet­ter wages and work­ing con­di­tions for their mem­bers, or for the bet­ter­ment of so­ci­ety, is to lull one­self into false com­fort.

History has shown us that in this countr y, unions are st rad­dling t he econ­omy, and they won’t be let­ting go for a while. In the po­lit­i­cal econ­omy, they have an abil­ity to tip the scales. So we right­fully ob­sess about their ac­tiv­i­ties. To ig­nore them would be ar­ro­gantly blind.

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