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Five possible solutions for SA’s unemployment crisis as job summit nears

With an unemployment rate of 27.2%, President Cyril Ramaphosa has called for a Jobs Summit scheduled to take place over two days this week.

The summit will see government, business and labour come together to address unemployment.

Several organisations have put forward their views on the summit.

Here are some of the proposed solutions to SA’s jobs crisis.

Boost economic growth

Investec Chief Economist Annabel Bishop believes if weak economic growth persists (below 3%) then it will be difficult to reduce unemployment, inequality and poverty.

Bishop noted that SA’s real GDP per capita – the measure of the standard of living – declined since 2015 as economic growth fell.

“Clearly extremely strong, sustained economic growth that results in both a tripling in the size of the private corporate sector and includes the majority of South Africans currently outside of the formal employment net (into formal employment) is the solution for South Africa,” said Bishop.

Bishop also stressed the importance of job creation to help reduce socio-economic inequalities and poverty.

Retain jobs

The Federation of Unions of South Africa’s (Fedusa) General Secretary Dennis George has called for the retention of current jobs.

“It is a contradiction in terms to be talking about large scale job creation through the Jobs Summit, while on the one hand hinting at a possible lay-off of 30 000 civil servants,” George said, referring to reports that government will embark on restructuring among public servants.

“Job retention should be one of the critical pillars of the Jobs Summit, and it is imperative for social partner leadership to meet regularly to monitor and evaluate the so-called dismissal of employees for operational requirements at Nedlac going forward,” said George.

The Commission for Conciliation, Mediation and Arbitration (CCMA), in turn, should be involved to support job retention, he added.

Measures to support job retention should include a flexible training lay-off scheme, reduced working hours, placing a moratorium on new appointments and overtime or Sunday work, transferring affected employees to other jobs in the employer’s business or group, training or re-skilling employees for other available positions and granting extended unpaid leave, he proposed.

George further called for government to fill vacant civil servant posts which have compromised service delivery.

Overhaul of policy

The South African Federation of Trade Unions (Saftu) will not be attending the summit, as it might not yield solutions for SA’s economic crisis, said acting spokesperson Patrick Craven.

“Both the business and government constituencies at Nedlac are part of the problem, rather than the solution. It is their policies over 24 years which have led to this crisis,” he said.

Saftu expects the same “business as usual approach” with “vague” targets being set and promises made.

Craven went on to say that SA’s policies are dictated by what happens in the world market, as SA is an exporter of raw materials and has not developed its manufacturing industry.

“We need a fundamental difference – a different policy based on nationalisation of key sectors such as mines, banks and major manufacturing monopolies so they can be planned and developed democratically – in the interest of the people as a whole.”

He does not expect a complete overhaul of policy to come from the summit. He called on federations attending the summit not to accept “business as usual”.

The Centre for Development and Enterprise (CDE) also called for policy reforms that would reduce unemployment. “Instead, South Africa’s policies raise the cost of doing business, discourage employment and reduce the economic growth rate,” the CDE said in a statement.

Support for entrepreneurship and small businesses

The CDE also called for an enabling environment for entrepreneurs and small businesses.

“Policy that ensures their survival and expansion, as well as the creation of many more new firms, would have the most impact on unemployment,” the CDE said.

The CDE said SA had focused on building an economy of high skills and high wages, while ignoring the reality of unskilled and inexperienced job-seekers. “We need an environment conducive to firms making and selling goods and services using the workforce we have, not the workforce we wish we had.”

Bulelwa Makalima-Ngewana – interim director of Bertha Centre for Innovation and Entrepreneurship, a specialised centre at the UCT Graduate School of Business – also promotes the idea of youth being entrepreneurs rather than job seekers.

“You no longer have to wait around for a job; you can start something yourself that not only earns an income but solves the problems you see in the community,” she said.

“We need to get it into the minds of more people sooner that entrepreneurship is an option.”

Concrete targets and deadlines

The Congress of South African Trade Unions’s (Cosatu) parliamentary coordinator, Matthew Parks, said the congress wanted to see targets and time frames to ensure the summit is not another talk shop. There should also be details about the investment in particular sectors of the economy such as agriculture, manufacturing and tourism, which will drive further job creation.

Cosatu also called for more practical plans and commitment from government and business. There should be follow-ups in a few months’ time to measure progress to see that the summit is effective, Parks said.




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