4 July 2016

The latest report by the Quarterly Employment Survey that shows that in the first quarter of 2016, the formal non-agricultural sector of the South African economy shed 15 000 jobs is a sign that South Africa is yet to heed the siren calls ,warning of the societal consequences of unemployment and retrenchments. This also signals that all social partners are still in denial about the extent of the crisis.

The piecemeal approach that has been adopted by government in particular, to deal with the ongoing retrenchments ,and the rhetorical preambles and slogans that have been offered as policy responses to unemployment are far from being adequate. We need a bold and decisive collective response to the crisis of this magnitude.

These latest figures mean that employment declined by about 0.2% to 9.2 million people in the formal non-agricultural sector of the economy. Our unemployment figure of 27% does not even factor in the discouraged workers, who are no longer looking for jobs.

This is calamitous for the country because it means that for a whole generation, the habit of working is being lost, and millions of young people will be dependent on the state for their well being and that of their families.

South Africa’s unemployment crisis is the worst in the world and we have even surpassed Greece, whose economy imploded a few years back and has since been hamstrung by global and European financial institutions.

The federation is reiterating its call for urgent action to deal with this crisis. We are also urging workers to ensure that they balance salary adjustment demands with job security during wage negotiations. While ,we uncompromisingly insist that for the lower paid workers, unions must push for above-inflation increases, we expect that better -paid employees could settle for wage increases that are in line with inflation.

We also expect that companies, institutions and governments departments will also deal with the issue of excessive executive pay ,because it will make it difficult for the unions to reduce demands or accept lower increases. The investment strike that has been going on will have to stop if we are to get out of this economic quagmire.

There is a drastic need for a change in attitudes ,all-round, if we are to deal with unemployment and stop the ongoing retrenchments. We are already seeing government struggling with pressure from a population that has seen deepening poverty, rising inequality and the growing unemployment. We are still not convinced that adopting regressive and contractionary policies that only focus on cutting social expenditure is a solution. Our economic growth remains subdued and we are inevitably facing a recession, while we are muddling along with our failed policies.

The federation reiterates its call for a decisive state intervention in strategic sectors of the economy. Government can no longer afford to act as a neutral spectator ,when the economy is on its knees. We expect the state to use a variety of economic and other levers at its disposal, to regulate and channel investment in the job intensive areas of the economy. Our macroeconomic policies need to be radically overhauled in line with the radical economic shift that is needed at this time of crisis. The future is in promoting investment in rural areas and the townships economy because economies are made up of people.

Sizwe Pamla (National Spokesperson)
Congress of South African Trade Unions
110 Jorissen Cnr Simmonds Street

P.O.Box 1019
South Africa

Tel: +27 11 339-4911 Direct 010 219-1339
Mobile: 060 975 6794-082 558 5962
E-Mail: [email protected]

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