The Spectre of Unemployment

In the aftermath of developments at the ANC Polokwane Conference, there is a prevailing view among certain Economists and Labour Experts that President Jacob Zuma`s Goverment is more pro-labour than that of former President Thabo Mbeki`s administration.

The increasingly strong and militant labour force, particularly in the public sector, is beginning to play havoc in the economy. This is of concern to observers considering the fragile nature of the country`s key economic indicators, showing a slow recovery from the recession.

The National Union of Mineworkers (NUM), who have a presence in the Construction Sector, were very much involved in the resounding victory by Eskom employees over the public utility earlier in the year. The 9% increase granted by Eskom is setting the benchmark for the entire public sector, as the increasingly powerful labour movement is shifting gears to increase their demands.

The May 2010 month-long Transnet strike resulted in a wage increase of 11%. With the successful FIFA World Cup Finals behind us, a host of Trade Unions and Public Sector Staff Associations are girding their lions to take on the Government as the largest employer in the country. A wide scale public sector is threatening against the background of the release of the Labour Force Survey indicating that the unemployment rate in the second quarter of 2010, had increased from 23.6% to 26.3% year on year. About 870 000 jobs were lost during 2009 and a further 170 000 were shed during the first, and 61 000 in the second, quarters of 2010.

However according to Statistics SA, the number of unemployed only increased by 2 000 persons in the second quarter of 2010. Henk Langenhoven, Chief Economist of the South African Federation of Civil Engineering Contractors (SAFCEC) was quoted as stating 500 000 jobs were shed in Construction in the 1980-1990 downturn. With the SAFCEC Economic Index plummeting 70%, the lowest since 2003, jobs in the sector are again being shed at an alarming rate.

What is not generally known is that StatisticsSA does not include the unemployed who have given up hope of finding employment. It is claimed that should these so-called `hopeless` cases be included in the Statistics SA releases, the unemployment rate could rise to as much as 32.8 %. Prof. Carel van Aardt of the Bureau of Market Research at UNISA is of the opinion that even this figure does not reflect the true state of affairs and there is evidence that the employment rate was already 44% during 2009 and a whopping 84% among the youth. The announcement of incentives to encourage the employment of the youth announced by President Zuma in his State of the Nation speech earlier in the year seems to be buckling under the onslaught of his alliance partners in COSATU and the SACP who are the proponents of so-called `decent work` for all in employment.
 
It is a moot point whether full employment based on decent work principles is sustainable in south africa ?

Pieter Rautenbach