5 February 2013

South Africa: Cosatu Dismayed By Job Statistics

Photo: Rodger Bosch/MediaClubSA
Container ships in Cape Town harbour.

The Congress of South African Trade unions is dismayed that 68,000 jobs disappeared from the South African economy in the fourth quarter of 2012, according to Stats SA’s Quarterly Labour Force Survey (QLFS) published today.

This is despite the fact that the unemployment rate declined slightly - to 24.9% of the labour force in the fourth quarter, from 25.5% in the previous quarter, while the expanded definition of unemployment, which includes people who have stopped looking for work, fell to 35.9% in the fourth quarter, from 36.3% in the third.

This apparent contradiction arises because of a drop in the total labour force of 235 000 persons between the third and fourth quarters of 2012, a decrease of 166 000 unemployed persons and 68 000 employed persons. This implies that there is a big increase in the number of workers who are simply opting out of the economy and becoming marginalised

This is the first time since the inception of the QLFS that there has been a decrease in employment in the fourth quarter of a year. Every other year since 2008 there has been a rise in employment during the fourth quarter of every year, which includes the festive season, followed by a decline in the subsequent quarter. This decrease does not bode well for the coming months.

Year on year, employment increased by a miniscule 0,6% (80 000), while unemployment increased by 6,1% (257 000). The number of discouraged work-seekers decreased by 2,5% (58 000) and other (not economically active) increased by 1,4% (180 000), resulting in a net increase of 121 000 in the not economically active population.

These disappointing figures make it even more urgent for the Government, together with labour and business to put into action the many excellent policies on paper for restructuring our economy and creating decent employment – the Industrial policy Action Plan, the Infrastructure Development Programme and at least parts of the New Growth Path.

Combined with this approach we need to speed up the reforms in our education and training sectors to ensure that school leavers are equipped to take on the jobs which should by now be coming on stream.

The figures also strengthen the case for a significant cut in interest rates, to provide relief for employers struggling to avoid retrenching workers and as an incentive to those wanting to create new jobs, and for Nersa to reject Eskom’s five-year 16% tariff increases, which, as many employers have warned, will lead to more job losses and a huge disincentive to new investment.

If we cannot start to rapidly bring down the rate of unemployment, the social consequences will be dire. More ticking bombs will explode, as more and more workers, especially the young, start to lose hope.

That is why COSATU has lodged a notice under Section 77 of the Labour Relations Act to allow for protest mass action on the slow pace of socio-economic transformation in South Africa.

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