While official figures say that between three and four people out of every 10 people are unemployed, for black communities, especially rural ones, the figures are much higher.
Why the unemployment crisis?
….Not enough has been done to overcome the inequalities left by apartheid.
Millions of people have no resources and must depend on wage labour. Mass poverty depresses local demand, leaving industries increasingly dependent on uncertain and unstable export markets.
….From the early 1990s South Africa plunged into the global economy with insufficient safeguards for its own industries and jobs.
In 1997 the government implemented a rapid phase-down of tariffs, in some cases to levels below those required by multilateral agreements. This reduction in protection was not matched by strong policies to build up a more competitive industry. The result has been persistent job losses, especially in light industry.
…. Despite limited tariffs that protect local industries, importers have found loopholes to get around these tariffs.
For example, domestic washing machines are brought in as if they were commercial washing machines because they can carry loads greater than 7kg and a commercial washing machine has a lower tariff than a domestic one.
Other importers merely flout all laws with the result that illegal imports have blossomed.
….From 2002 the rand has appreciated dramatically, threatening our export-led growth.
Exports rose by only 5% between 2002 and 2004 while imports shot up by 25% in the same period, especially in labour intensive Numsa sectors like electronics, electrical goods and fabricated metal products. Before that, the gradual decline in the international value of the rand had offset the impact of falling tariffs without causing excessive inflation.
…. Import parity pricing of raw materials prevents further downstream development.
Levels of beneficiation (processing materials like steel into further) in the metals industry are below international standards.
While companies like Ispat Iscor claim they want to increase domestic consumption of their product, they charge domestic users import parity prices for their products. This makes the price of steel in South Africa more expensive than if the same company were to buy Iscor’s steel in China for example. It forced a company like Cadac to close down because it could not compete with Chinese imports.
[Information from Cosatu and other sources]
In poor rural townships where unrest is being quelled, figures reach as high as six people out of every 10. Most of the unemployed are less than 35 years old and have never had a job.
While the news has focused on the job loss bloodbath in the textile and mining sectors where closures and retrenchments could see the loss of more than 17 000 jobs, in Numsa-organised sectors, the steady blood-letting also continues.
At Numsa’s National Bargaining Conference, delegates resolved to put their might behind Cosatu’s campaign around job losses.
Cosatu’s and Numsa’s demands:
Strong measures to end the overvaluation of the rand, especially through a reduction in the real interest rate. The interest rate is currently low in nominal terms, but in real terms – that is, after taking inflation, measured by the CPI, into account – it is still higher than it was in the early 1990s or the 1980s.
Business must make much more serious efforts to avoid job losses. Retrenchment and closure should be the last step.
Retailers must stock local goods, rather than imports. The mines must do more to develop South African industry, rather than focusing on foreign mining opportunities.
Government must do more to assist businesses to avoid job losses and to help workers confronted by retrenchment. Local, provincial and national government must put far greater pressure on business to invest and grow more, and at the same time align all measures to support job-creating growth.
Government must put its commitment to employment creation into action.
Government must review its trade strategy to ensure that it stops destroying jobs. At the WTO it must fight for the right of developing countries to support new industries and protect vulnerable jobs. Moreover, government must review engagement with other countries, especially China , to ensure that new measures support employment and do not destroy jobs. The WTO provides for special safeguard measures to protect industries that face a huge threat from Chinese imports. These measures must be applied urgently to save the clothing industry.
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Dark clouds on the auto miracle horizon
Dumisa Ntuli
Investment in the automobile sector is soaring with vehicle sales hitting record levels. But more and more workers employed in the sector face an uncertain future with no security of employment.
At VWSA, 1000 workers are in temporary jobs. Outsourcing at its parts distribution unit remains the biggest threat to jobs.
At Daimler Chrysler, there is still a threat to retrench 400 workers despite workers opting to work three or four days a week. The announced employment of 2000 workers will only take place in 2007 with no security of employment.
At BMW SA, workers are on short-time. The company offered voluntary separation packages to 154 workers late last year and no new jobs were created. With the coming of the BMW 3-series E90 there is no guarantee of employment.
At General Motors the company is outsourcing the tool room and an undisclosed number of jobs will be affected. The union has taken the matter to the CCMA for facilitation.
At Robert BoschSA, the component manufacturing company, the picture of employment is not impressive at all, with the company threatening to retrench 145 workers.
At Ford Motor Corporation, the company has offered more job opportunities to young workers than before. Out of 800 workers, 320 will be taken on fixed learnership programmes and over 400 workers on temporary employment. The union is negotiating for guaranteed permanent employment.
The situation at Toyota plant is quite encouraging. The union managed to negotiate for permanent employment of 800 workers with the number of undisclosed workers taken on learnership programmes.
The Nissan Company is planning to increase its production capacity and employ around 100 workers before the end of June 2005.
Man-Truck employs 205 workers and only 10 are permanent and labour brokering and outsourcing is rife and poses a serious threat to jobs.
Company restructuring is reducing the workforce in the metalworking industries particularly in South Africa . Dramatic developments in technology over the past decade, particularly digital technologies, have significantly changed industrial processes. The major part of the manufacturing process has been automated leading to reductions in jobs.
Employers are introducing new employment practices involving flexible work organisation and production systems, non-standard forms of work, and the linking of pay to performance. All of the changes have an adverse effect on workplace rights and protections.
The wave of investment must bring different results for workers in the form of guaranteed employment and social benefits. Numsa will utilise a range of mechanisms to engage automobile companies to employ workers on a permanent basis. Among the most important are the negotiation and implementation of International Framework Agreements to force automobile companies to implement the same working conditions across the world.