South Africa’s Impala Platinum has started talks with the government and unions that could see up to 2,500 workers laid-off at its Rustenburg operations west of Johannesburg, the company said on Monday.
Implats, the world’s second biggest platinum producer, said last week job cuts were possible after it reported a 2017 year loss. The Rustenburg operations have been hit by social and labour strife in recent years.
Lay-offs are a sensitive issue in South Africa where the unemployment rate is about 27 percent. South African firms are must hold consultations with unions and the government before they can lay off large numbers of workers.
The company said further reductions could be in the pipeline at Rustenburg, which has a labour force of 31,000, as the company struggled to return to profitability.
“It is expected that some 2,500 people could be affected near term, but this does not preclude further optimisation processes that may be required in future to ensure the continued sustainability of the operation,” the company said.
“Labour productivity rates have declined over the last few years and production levels at Impala Rustenburg have been reduced from a historical base of some 1 million platinum ounces per annum, to the 680,000 to 720,000 ounces forecast for the 2018 financial year,” it said.
South Africa’s mining industry has shed close to 70,000 jobs, about 13 percent of the labour force, since 2012 in the face of volatile or depressed prices, soaring costs, labour and social unrest, and policy uncertainty.