No ap­petite for re­form

Business Day - - OPINION -

Michael Ba­graim (Min­i­mum wage mock­ery, Novem­ber 8) is quite cor­rect that the pro­posed min­i­mum wage ex­emp­tion reg­u­la­tions make a mock­ery of labour leg­is­la­tion. But they also make a mock­ery of the gov­ern­ment’s stated job-cre­ation am­bi­tions.

Whereas 1.9-mil­lion peo­ple were recorded as un­em­ployed in 1994, the num­ber in the third quar­ter of 2018 was 6.2-mil­lion.

The labour force ab­sorp­tion rate for black peo­ple is just more than 40%.

SA’s rate of un­em­ploy­ment is four to five times higher than that of coun­tries such as Chile (7.1%), the Philip­pines (5.4%), Poland (5.7%) and Bul­garia (5.6%). For black peo­ple aged 25 to 34, the un­em­ploy­ment rate is just shy of 50%, when the com­par­a­tive fig­ure for whites is be­low 7%.

That min­i­mum wages are pro­posed at all, let alone these silly ex­emp­tions, goes to what we wrote ear­lier this week on these pages: there is as yet no en­thu­si­asm for struc­tural pol­icy re­form in the gov­ern­ment.

Don’t be fooled by the “op­ti­mism” and “pos­i­tive sen­ti­ment” punted by or­gan­ised busi­ness — it is fluff built around gim­micks such as stim­u­lus pack­ages, sov­er­eign wealth funds and in­vest­ment con­fer­ences.

The prob­lem is that pol­i­cy­mak­ers are still im­pris­oned by left­ist and racial na­tion­al­ist dogma. Un­til that changes, the prospects for much im­proved eco­nomic and so­cial in­di­ca­tors are vir­tu­ally nil.

Frans Cronje

CEO, In­sti­tute of Race Re­la­tions

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