Big business must put its money where its mouth is

Neither the budget speech nor the State of the Nation address (Sona) can extract our economy from the mire; at best, they infer state policy direction rather than certainty.

Fact: 35% of the labour force is unemployed or has given up hope of finding work;

Absorption of the youth (graduates or nongraduates) into the labour market is South Africa’s biggest economic challenge; and

Government debt stands at R2.2 trillion, or 50.7% of GDP, while public service expenditure expands moderately above inflation.

Declining productivity has plagued the economy since the mid-2000s, as has underemployment.

President Jacob Zuma’s Sona six years ago announced: “We’ve declared 2011 the year of job creation and mobilised our social partners, namely business, labour and the community sector, to work with us in implementing the New Growth Path.”

Disappointment followed: fewer jobs were created, precipitating a change in the country’s economic narrative to focus on the lack of growth; “recession” became a key word.

South Africa’s economic slump has lasted six years and output remains far below its peak in the early 2000s.

Peripheral growth is almost insignificant in real per capita terms when compared with countries like Brazil, Turkey, Indonesia, India or China.

A reality: prospects of improvement are negligible. The economy’s cracked and fragile walls are giving in, soon they will collapse and bury us.

Why am I telling you all this? It’s time to put private sector’s investment strike on the table. Alongside troubled state policy, it is as responsible for this troubled litany.

It is a truism that politicians will make mistakes and business will criticise and even oppose them. It is also a truism that in the dominant public narrative, business hardly ever experiences the same level of criticism.

We hardly ever give the private sector a lashing or scrutinise corporate practices to the same extent as we do the state.

While business claims to support Finance Minister Pravin Gordhan’s call for “collective choice in growing the economy”, its unwillingness to invest its burgeoning cash pile locally belies its commitments.

In failing to put its money where its mouth is, business must equally bear the responsibility of a failing economy.

By refusing to invest locally, the private sector has ensured that households and businesses suffer inflation, while the economy stagnates.

Each quarter, Statistician-General Pali Lehohla talks about the high number of black graduates who still battle more than any other demographic to find jobs. Yet corporate South Africa says it cannot find qualified people to employ.