‘New administration must change labour laws to create meaningful jobs’ - labour expert

Published Jun 15, 2024


AS the Government of National Unity (GNU) shifts into gear, power dynamics in the country are set to change.

The influence of the trade union movement will drop radically. A pressing issue for the 7th administration to tackle is unemployment.

Labour law expert Michael Bagraim said the situation could not be left unresolved, adding that it could not be business as usual.

“It is now incumbent upon the political parties to [take a] relook at the labour situation to ensure that job creation is enhanced in the private sector. All the political parties had job creation at the top of their manifesto.

“It is quite clear to all the economists that the stranglehold the trade unions had on job creation has [retarded] growth. The new dynamic structure of political leadership has opened the pathway to ensure that South Africa can start moving forward.

“The harsh labour regulations need to be liberalised and our system cannot rely on a ‘Big Brother’ attitude. We all look forward to her march to a free market economy,” Bagraim said.

He said that under the ANC-led government a centralised approach to job creation was taken.

The labour expert said this approach had worked for a few years, but the system started collapsing about 20 years ago.

“The structured control was not conducive to real job creation And government became bloated by employing more and more unqualified civil servants. This was not productive at all and has created a civil service which is earning more than the private sector and producing less.

“Common knowledge tells us that it is the private sector that heads jobs and these jobs are functional to both the fiscus and economy. The approach taken by the Western Cape government has been to encourage the private sector to employ more people And produce more goods.

“This approach, although slow, has shown fantastic growth, and unemployment in the Western Cape has been brought down to below 20%, as opposed to a national unemployment figure of 40%. This structured experiment in the Western Cape has produced results and needs to be followed and implemented across the country,” Bagraim said.

South African Federation of Trade Unions (Saftu) spokesperson Trevor Shaku said the idea of overhauling the country’s labour laws was “madness”.

He said it would make labour cheap.

“Madness is at the level of supply business, enterprise are not interested in job creation. There’s no guarantee that by lessening the labour power there will be creation of job creation.

“A role of the minimum wage is to make the workers to be able to survive and supply for his family.”

Shaku said that as it was, the proposed minimum wage for workers was not enough considering the current price of food, transportation and the cost of children’s education.

Statistics South Africa indicated that the rate of unemployment rose for the second quarter in a row, to 32.9%, in the first three months of this year.

“The increase from 32.1% in the fourth quarter of last year brings the official unemployment rate closer to the record high of 35.3% reached in late 2021 during the Covid-19 pandemic.

“In the first quarter of 2024, the largest decreases in employment were in the community and social services and construction sectors. There were job gains in sectors such as manufacturing, agriculture and mining.”

StatsSA said that over the past two years it had recorded a significantly higher unemployment rate than in the preceding years.

The results of the Quarterly Labour Force Survey also indicated that the number of employed persons increased by 22 000, to 16.7 million, in the first quarter of 2024 compared to the fourth quarter of 2023.

According to StatsSA: “Additionally, the number of people who were not economically active for reasons other than discouragement decreased by 214 000 to 13.1 million, while discouraged work-seekers decreased by 1 000 in the first quarter of 2024 compared to the fourth quarter of 2023.

“This resulted in a net decrease of 215 000 in the not economically active population.

“The above changes in employment and unemployment resulted in the official unemployment rate increasing by 0.8 of a percentage point, from 32.1% in the fourth quarter of 2023 to 32.9% in the first quarter of 2024.

“The unemployment rate according to the expanded definition also increased by 0.8 of a percentage point to 41.9% in Q1: 2024 compared to Q4: 2023,” it said.