Gripped by anger and fear, I like many South Africans have been paying close attention to the mayhem unfolding on the platinum mines. I asked myself how is it possible in a country with such high unemployment, that workers on our gold mines would put their very livelihoods on the line as they are.
I fell in line for calls of "fire the lot and let people who want to work get the jobs" and "shoot the lot". Then I started to consider whether they are that wrong in what they are asking for so I decided to do some shallow research, my facts may be somewhat off, forgive me for that.
We need to ask the question, does high unemployment mean that those that have work be treated any differently from a situation where all have work and indeed should profit margins in South African mines be higher than any other countries?
What my research has turned up, the minimum wage in the UK is around R12000 and labourer earns around R15000, granted the cost of living in the UK is higher but these are guys carrying bricks and moving office furniture.
Regarding mines, it seems the cost of extracting an ounce of gold costs around $650, the gold price is around $1700 leaving a gross margin of $1150. South Africa produces around 700 000 ounces of gold per month and employs 240 000 people.
I started my career on the gold mines and in 1992 as an electrician I was earning the equivalent of 3 ounces of gold, R3600 and the mines were viable, if that was true for today, an electrician would be earning R45000 per month and why should he not earn this, I now work offshore in the oil and gas industry earning way above even that level and the oil companies are making huge profits, (yes I know mining is more labour intensive).
I ask again, is what they are asking for so unrealistic? Are they just another cost for the mines that needs to be kept as low as possible?
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