Internet deals may spark jobs bloodbath
Labour law inflates prices Workers should be retrained
SURF, click, deliver: That’s how easy it is to buy cheap goods like clothing from online stores based in foreign countries – but it’s devastating South African manufacturing and costing jobs.
Experts say cheaper online stores are pricing locally manufactured goods out of the market and could lead to many job losses; not only in manufacturing, but in warehouses, malls and physical stores as well.
Professor Pfano Mashau from the University of Kwazulu-natal said the government should subsidise local companies so they could lower prices and compete with international websites like Temu and Shein.
“In South Africa with its labour law, it’s more expensive to produce goods here and if I’m going to get into the textile industry, there’s definitely no way I’ll compete with the Chinese.
“It calls for government policies to protect South Africans in indus- tries that are more vulnerable to open markets, so jobs are definitely going to be lost ... they will need some form of subsidy for them to be competitive.
“They will need flexible labour laws to enable them to employ people temporarily so they don’t have high salary costs,” he said.
Mashau said the retraining and reskilling of workers had to take place to keep up with new and emerging forms of employment.
Mashau said one South African company manufactured shoes which sold for an average price of R1 200, but online, a similar pair of shoes without the brand name could be bought for between R150 and R200.
“It means I can buy it for 10% of the price so the next time I won’t be buying a South African-made product. Some of these companies are about to go out of the market because of the high cost of producing these shoes and the high cost of hiring shops in the mall and that’s where people are employed. They’re going to lose employment; it’s something we cannot avoid in these times that we live in,” he said.
Cosatu spokesperson Matthew Parks said imports, especially in the textile industry, had caused massive job losses locally in the last few years.
More than that, he expressed organised labour’s concern at how it remained easier for imports to make their way into the country without paying import duties.
According to Parks, the emergence of the online industry had also posed another challenge in an already difficult jobs market: “When you have local online retailers, you have a face and a person you can negotiate with. However, it is a different ball game altogether when such a retailer is foreign-based as is the case right now.”
Parks said they would use every available avenue to advocate for locally produced goods to be protected against foreign imports in all sectors of the economy.
“If we can get the government, the mining sector, the retailing industry to all buy locally made goods, we can protect and even create jobs and that is why this struggle needs to be constantly waged.”
Global data and business intelligence platform Statista said the number of online shoppers in South Africa was directly proportional to the number of internet users in the country. It said that in 2022, nearly 80% of South Africans used the internet and there were 27 million e-commerce users. By 2027 these figures were expected to leap by about 10%. It said most of the online buying in the country were in fashion, toys, hobbies and DIY.
Dr Colin Thakur from the Durban University of Technology urged shoppers to be cautious when they bought online goods, saying the nature of internet engagement was fraught with cyber security issues.
He warned that if a deal seemed too good to be true, then it probably was.
Thakur said: “The moment you engage with somebody you don’t know, there is an inherent risk of that particular person, a particular website tracking you, finding out information about you, and also you’re exchanging information; your name, your address, things like that. So somebody can put up a very beautiful template just to phish information from you so you really have to be careful about the integrity and the veracity of a website.”