The Jobs Summit convened by President Cyril Ramaphosa takes place at a time when our economic growth is sluggish and our businesses are bleeding jobs.
Just last week Stats SA revealed that almost 70 000 jobs were lost in the second quarter – 13 000 of those in the manufacturing sector.
The IMF expects the situation to get worse still, with our jobless rate reaching 28.3% next year. That is worse than it’s ever been.
Ratings agency Fitch sees our economy growing at a pedestrian 2.2% annually over the next decade, with our progress held back by power shortages, strikes and continued malaise in the mining sector. We will continue to lag our global peers.
The data shows that our government simply has no fiscal headroom to catalyse growth, without risking our sovereign credit rating and raising borrowing costs for a generation. To be sure, we remain precariously placed for the rating reviews that will follow the medium-term budget later this month.
The reality we face is that we must grow consistently at more than 6% for us to make a dent in unemployment. That target is a long way from where we are, especially in a global environment with more headwinds than tailwinds.
We are under no illusion that the Jobs Summit, on its own, will stem this tide of job erosion.
But the summit is essential if we are to generate innovative ideas of stimulating employment creation across our economy. We have to find pragmatic ways to protect jobs wherever possible, and to identify and nurture the potential for new jobs that will help turn back the tide.
We will need to fully leverage our multilateral forums, such as Nedlac, in order to find ways to confront – and resolve – the structural problems that underpin this economic crisis.
Policy to drive investment
South Africans have been hard at work crafting a policy framework that is conducive to investment while also honouring our constitutional mandate to transform society and achieve socio-economic justice. The President’s recently announced stimulus package alludes not only to this important balance, but also the need to prioritise state spending to jump-start the economy
We welcome the intent of the stimulus package. Few can argue with its emphasis on better planning and improved use of existing resources to boost growth and employment. The advancement of outstanding reforms also remain crucial if we are to reinvigorate economic growth and make our economy more inclusive.
We are painfully aware that our rising public debt requires urgent attention if we are to stabilise the economy. Equally urgent is the imperative for fiscal consolidation, reigning in leakage from corruption, and choking off wasteful and irregular expenditure to halt the never-ending call for bailout from our SOEs.
We applaud the clean-up we’ve seen in some state companies, and we continue to urge employment of competent, experienced and scrupulous leaders as custodians of the state’s capital and the ambitions of its people.
So, as we wrestle with the complexity of assembling the right basic ingredients for successful growth: budget allocation, taxes, monetary policy, trade and industrial policies, to name just a few, we must agree that that there is no painless, quick-fix solution to our employment predicament.
As we deliberate, we need to bear in mind the challenging work of crafting the policies that will indelibly influence the lives of millions of our people: their job prospects, their health, their education, their access to basic amenities like water, and the overall quality of their daily lives.
The most pressing task of finding employment for a largely low-skilled population must also not undermine our longer-term goal of cultivating a working population with the skills to thrive in a rapidly changing modern economy.
Automation, AI and robotics
The future of work in SA is likely to be impacted by these changes including automation, artificial intelligence and robotics. The World Economic Forum predicts that 41% of all work activities in South Africa are susceptible to automation. That’s a staggering number.
So, as we contend with the structural impediments that are a legacy of our past, we are also keenly aware that the Fourth Industrial Revolution is upon us.
But it would be a mistake to reflect on these challenges of the digital era, without the digital generation leading the charge. We must rediscover the value of the young in the redefinition of our future.
If we fail to prepare in anticipation of these disruptions, our current unemployment problems will soon seem like prosperity in comparison with the employment calamity we’ll face. We must have bifocal vision - fixing the challenges of today, and preparing for the future.
Eight months since SONA and three months of collaborative work at Nedlac, we as the social partners – community, labour, government and business – have responded to the President’s call of "Thuma Mina".
We have put our heads together and dedicated considerable time and resources in our collective quest for answers to the universal socio-economic questions that have stalked the Republic since independence: how to grow the economy to create sustainable employment while addressing endemic poverty and inequality.
As business, we assure South Africa of our commitment to the outcomes of the Jobs Summit, and say: "Thuma Thina, Thuma Mina, Mr President."
We want to be there when you start to turn it around. We want to lend a hand in the urgent collective struggle against poverty, unemployment and inequality.
Send us, Mr. President!
* This is an edited version of the address to the Jobs Summit on 4 October by BUSA President Sipho M Pityana, the Business Constituency Leader at Nedlac.
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