Judge mini budget in terms of jobs crisis

2010-10-30 16:27

The only way to judge this week’s medium-term budget policy ­statement is on the effect it will have on employment.

We are in a crisis, though we hardly ever ­describe unemployment in these terms, ­treating it as a “challenge” instead.

But ­consider this week’s statistics. While the ­economy is said to be in recovery after the ­recession, it continues to shed jobs.

Officially, unemployment is currently at 25.2% of the working-age population.

The ­figures also suggest that those who are looking for work are growing discouraged.

There are more than two million South Africans who have become tired of looking for work. ­

Include them in the measure of unemployment and the figure shoots up to 36.6% – that’s ­almost four in 10 job-seekers.

With a tiny ­informal sector, South Africa’s unemployment crisis is regarded as unique because it is so ­impervious to stimulus and so deeply ­structural that even relatively high growth rates of the early years of this decade fail to make a dent.

The reasons for this are manifold and complex.

They stretch all the way from apartheid to globalisation and to wage policies.

Bantu education failed to prepare a generation of South Africans for the changes that globalisation and the changing world order required.

Our economy moved rapidly away from one dominated by mining and manufacturing to services.

Minimum wage policies and centralised bargaining saw a move to capital-intensive methods.

The standoff between clothing makers and the industry bargaining council in Newcastle is a symbol of incorrect wage policy.

The local business chamber has threatened to shut up shop if it is forced to pay minimum wages, and workers have united with their bosses against the bargaining council.

It surely is an indicator of things to come.

But unions are unlikely to support wage ­flexibility like this.

Given our jobs crisis, the setting of a target to bring unemployment down to 15% by 2020 is a good one.

For too long, employment has been too far down the list of priorities and the national growth path launched on Monday puts it at the top of policy-making, where it belongs.

While targets have been set and missed ­before, we should not become cynical as a ­nation.

The only way to measure our success is to put our people to work.


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