Time to get SA back on job-rich growth path

A clothing factory worker stitches new garments in a large clothing factory in Cape Town. (iStock)
A clothing factory worker stitches new garments in a large clothing factory in Cape Town. (iStock)

Cape Town - South Africa should put more faith in the revolutionary dynamic of high growth that will enable government to change our plight of poverty, inequality and unemployment in 15 years’ time, said Ann Bernstein, executive director of the Centre for Development and Enterprise.

Bernstein was the speaker at the Cape Town Press Club on Wednesday afternoon to launch the centre’s publication of The Growth Agenda, the result of a two year-project to pin down the main priorities to get South Africa back on a job-rich growth path.

She mentioned some sobering statistics, such as that 35% to 54% of South Africans are extremely poor and have to survive on between R500 to R750 per month.

“At least 7.5 million people in South Africa are unemployed. They want to work, but they can’t find jobs. And out of a population of 53 million people 22 million adults have no matric. That’s why we’re such an unequal society,” Bernstein said.

She was highly critical of government’s strategy to ameliorate poverty, rather than eradicating it. “We’ve done all these redistributive things, yet an enormous amount of people continue to live in poverty.”

In its publication, the Centre for Development and Enterprise set out a number of guidelines to bring about reform in the South African economy – one of which is to allow the private sector to create jobs for the high number of unskilled people.

“We need jobs for the workforce that we actually have – unskilled people – not the one we wish we had. We need to ask ourselves: is it better to be unemployed, or employed with a low wage?”

Bernstein pointed out that the location of the world’s manufacturing is changing. According to the World Bank, 18 million manufacturing jobs are moving away from China, because of the phenomenal rise in wages for these jobs. These industries are now moving to places, such as Laos, Cambodia and the Philippines.

“Just think about it,” said Bernstein. “If we can get a fraction of those jobs it would be fantastic.”

Currently only government is allowed to create low-wage jobs for unskilled people through its extended public works programmes, she added, but these jobs aren’t permanent. “It should be left to the private sector, which can provide training, and give people permanent jobs and the opportunity to move up the ladder.”

According to Bernstein there was no other country in the world that could move successfully from desperate rural poverty to becoming a developed nation without first going through a “factory stage”.

“We have massive unemployment because we’ve tried to cut out the factory stage.”

Bernstein concluded that South Africa should fix its skills system from beginning to end. “We’re not saying it’s good that people have low skills levels. The prospects of transformation and achieving an equal society depend on broad access to quality education and training.”

            
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