Labour protests against job losses as economy booms

Several thousand South African workers took to the streets to protest against unemployment and poverty this week, while a research think-tank forecast a brighter outlook for the economy. After a round of strikes by various members of its federation in the past few weeks, the Congress of South African Trade Unions (COSATU) called a general protest action on Thursday against the loss of more than 100,000 jobs over the past three years, with the textile and mining sectors bearing the brunt. The country's official unemployment rate is 26.5 percent, but analysts say it is as high as 40 percent. The general strike, which followed almost two months of industrial action by security workers, that twice turned violent, is being perceived as more than just labour flexing its muscles against business, but rather a show of strength by left-leaning allies as the succession battle heats up in the ruling African National Congress (ANC). Last week, the ANC's other ally, the South African Communist Party, attacked president Thabo Mbeki in a public document. COSATU and the SACP have chosen to put their support behind ANC deputy president Jacob Zuma, who was cleared of rape charges earlier this month. Zuma's supporters believe the rape charges were part of a ploy to remove him from running for president when Mbeki steps down in 2009. The succession battle is believed to be split between the Zuma and Mbeki camps. "At a time when we are told the economy is booming, it is disgusting that so many of our citizens are living in abject poverty, primarily because they cannot find work, or have to survive in low-paid, insecure, temporary jobs," said COSATU spokesman Patrick Craven. The Bureau for Economic Research (BER) at the University of Stellenbosch predicted that after recording strong growth of 4.9 percent last year, the South African economy would continue to grow at 4.5 percent in 2006/07. Pieter Laubscher, BER's chief economist, disputed labour's contention that the economy was not creating jobs. "The formal sector is creating jobs at the rate of 2.5 percent per year. According to the recent Labour Force Survey, between September 2004 and September 2005, 300,000 new jobs were created in the formal sector. Strikes do not help the economy - in fact, it could have a destabilising effect and help no one in the long run." COSATU's Craven maintained that most of these jobs were in the construction and retail sectors, poorly paid and temporary, and despite improvement in South Africa's growth rate, it was still too low to stimulate the economy to create jobs. The International Monetary Fund (IMF) projects a required annual growth of at least seven percent to meet the UN's Millennium Development Goal of halving poverty by 2015. Mozambique is the only country in the region to have achieved this target. Laubscher acknowledged that there has not been "adequate job creation", but blamed stringent labour legislation, which makes hiring an expensive proposition for small-scale companies, and suggested that government relax legislation to enable small firms to employ more people. Yunus Mohamed, an industrial relations and human resources lecturer at the University of Witwatersrand, said the government had shifted its focus from stimulating manufacturing, which is labour-intensive, to high-tech industries. "COSATU is doing what it has to do to highlight their problem." The National Union of Mineworkers (NUM) said the mining sector had laid off between 40,000 and 50,000 workers over the past two to three years under the pretext of a strong rand currency and a weak United States dollar price for gold. In the same period, according to the Southern African Clothing and Textile Workers' Union, more than 62,000 clothing, textile and footwear jobs were lost because local employers were unable to compete with cheap imports from China and either had to close shop or downscale their operations. "The clothing and textile sector is an exception, but with the prices of commodities [like gold] up, the mining sector should be able to turn around," said Laubscher. Although the scenario had changed in the past 18 months, said NUM, with platinum climbing to a record high of US$1,340 an ounce and gold reaching a 26-year high of $730,30 per fine ounce, none of the companies had opened closed shafts or rehired retrenched workers. To help the textile and clothing sector, COSATU has asked retailers to source products locally. The federation also called for an end to the casualisation and outsourcing of jobs. "We want more jobs in the essential services sector, which will not only employ more people but will also help improve services, like the provision of water and electricity, to all the corners of the country," said Craven. The government is pushing a similar idea with the Accelerated and Shared Growth Initiative of SA (ASGI-SA), a programme that aims to halve unemployment and poverty by 2014, and achieve a growth rate of six percent between 2010 and 2014. The programme intends to kill two birds with one stone: improve and build new infrastructure, which will stimulate job creation. But the major stumbling block is the lack of skills. The Joint Initiative for Priority Skills Acquisition (JIPSA) was launched earlier this year to address the shortage of skilled labour. COSATU supports ASGI-SA, said Craven, "but the question is not just about skills shortage - we have nurses and teachers without jobs." COSATU announced on Friday that it would continue to support the strike by security workers. Politically, COSATU needed to pace itself, Mohamed cautioned. "Strike action is the only weapon labour has - it should be used sparingly." He said the violent turn in the security workers' protest, in which bystanders were attacked, shops looted and cars smashed in the streets of Cape Town, South Africa's legislative capital, had affected the sympathy their cause enjoyed initially. A senior ANC member said COSATU's decision to hold a strike soon after the Zuma judgment had created a perception that "the left allies mean business". The ANC's presidency is up for grabs next year.