Imposing task to create sustainable job growth
IT IS just as well President Cyril Ramaphosa did not issue the customary May Day message marking International Labour Day on May 1 – a day when workers of the world unite and commemorate the world of work!
Instead, he left it to his Employment and Labour Minister Thulas Nxesi to roll call the “meaningful changes to the lives of workers” in employment conditions, protections and rights during the ANC’s 27-year rule.
Never mind that his Troika of Ministers – Tito Mboweni at the Treasury, Senzo Mchunu at Public Service and Administration and Nxesi – are collectively embroiled in a battle of nerves in the latest negotiations with unions representing over 1.2 million state employees.
The Treasury proposed a threeyear wage freeze. Unions want an inflation-proof 7.1% pay rise and a motley of allowances including a R2 500 housing allowance, provision of childcare and breast-feeding facilities at all government departments – which would make South Africa’ state employees some of the most entitled in the world.
The threat of a strike should negotiations fail would simply exacerbate the misery of South Africans – an ensuing administrative paralysis to match that of the pandemic.
Of South Africa’s post-apartheid presidents, Ramaphosa is unique. He once led the very labour federation, Cosatu, affiliated to the ANC coalition, now seeking this untimely pay hike.
The negotiations resemble more a family squabble, with various factions trying to get one over the other. Has Ramaphosa lost his negotiating mojo? Isn’t he best placed to act as “honest broker” with his proven negotiating skills?
The country’s jobless rate increased from 30.8% in Q3 to 32.5% in Q4 2020, which says Stats SA, is “the highest unemployment rate recorded since the start of the Quarterly Labour Force Survey in 2008”.
This translates into 7.233 million unemployed, against 15.024 million employed and 17.054 million economically not active – this out of a total labour force of 22.57 million.
Youth unemployment, ILO estimates, reached 55.75% in 2020.
The IMF’s Ana Lucía Coronel talks about “a decisive reform package that removes constraints to growth and job creation. Attracting investment and promoting competition is a key component. Facilitating private-sector participation in all sectors will reduce vulnerabilities and inefficiencies from relying on a few large players”.
Evidence suggests that this together with the smaller-than-expected fiscal deficit in FY20/21 projected by Mboweni in his 2021 Budget, says Fitch Ratings, “may give unions leverage to pressure the government to soften its position on public sector wages.
“Conflicts within the ANC over governance issues, and looming elections could hamper the government’s negotiating position”.
The February progress report reveals how far the country has to leap forward in generating sustainable job growth which would add meaningful contribution to tax revenues, GDP and living standards – 593 076 opportunities supported with only 360 010 actual jobs created or retained!