5 February 2013

South Africa: Cosatu and ANC Have Reached No Agreement On Youth Wage Subsidy

Contrary to media reports, the Congress of South African Trade Unions has not changed its policy on the Youth Wage Subsidy.

The federation is totally committed to the fight for jobs for youth. Millions of hungry, angry and desperate young people want the opportunity to work, earn a living wage and build a future for themselves, and COSATU is addressing their concerns.

We have over and over again warned that, as a result of the triple crisis of unemployment, poverty and inequality, the country is sitting on a ticking bomb. Young people constitute 63% of the working population, yet they make 72% of the unemployed. If we fail to provide these young people with the prospect of work and an income, the consequences for us all will be tragic.

The crisis of unemployment is however structural and there is no quick-fix solution. We require interventions to address the structural deficiencies we inherited from our colonial and apartheid past, in particular our dysfunctional education that continues to sideline millions and provide them with inadequate skills. A lot of the unemployed youth should in fact be at school, acquiring skills and increasing their employment potential.

In 2010 COSATU released a set of comprehensive proposals to address the triple challenge of unemployment, poverty and inequalities – A Growth Path Towards Full Employment. It articulated in greater detail the key stumbling blocks to job creation and proposed comprehensive responses to these.

That is why we are working with government and business on a Youth Employment Accord, which will address some of these challenges.

Any solution will require an interventionist developmental state. Job creation must be based on three pillars: a) expansion of social infrastructure and services, b) expansion of physical infrastructure and c) building value-chains for broad-based industrialisation.

We need an approach to youth employment that recognises that aggregate employment needs to be increased to avoid displacement and youth and older workers competing for the same jobs.

As part of building state capacity, we need to fill all vacant posts and re-skill existing unemployed graduates, some of whom can be trained so that they become educators in both the expanded schooling system and the FET sector, and also be trained to offer critical support to the departments in the social development and the criminal justice system clusters, where staff shortages are most acute.

Among the issues we are looking at is a national youth cooperative scheme, with funding to set up youth controlled cooperatives. They must however be genuine co-operatives, not set up by an employer to exploit workers even more ruthlessly. This could be complemented by special measures to promote youth-owned small businesses.

Only such long-term strategies show a way out of the massive crisis of youth unemployment, not the Youth Wage Subsidy, which is a bogus scheme which would put millions of rands into the pockets of employers while doing nothing to create more jobs overall or solve the underlying problems facing young workers.

ANC Secretary-General Gwede Mantashe, in his statement to the media yesterday, said was that the NEC is looking at “solid and implementable proposals on youth employment and development” and “youth employment support and incentive schemes”.

COSATU will wait to see what these proposals are and will then discuss them within the alliance and at Nedlac. We shall look sympathetically at any genuine proposals to reduce youth unemployment.

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