NATIONAL ASSEMBLY
PARLIAMENTARY QUESTION NO:376 ( CW473E)
Mr D B Feldman (COPE-Gauteng) to ask the Minister of Labour:
(1) whether, in light of the International Monetary Fund (IMF) Report
(details furnished), South Africa is facing hard choices on labour
reforms; if not, what is the position in this regard; if so, what are
the relevant details;
(2) what are his departmentâs plans to (a) curb and (b) coordinate with
the relevant stakeholders, the continuing downward spiral in (i) job
losses and (ii) addressing productivity in the job market to create
meaningful job growth and labour market efficiency;
(3) what factors have been found to be militating against a positive
trajectory? CW473E
MINISTER OF LABOUR REPLIED:
(1) South Africa is indeed facing hard choices on labour reform because
of the high number of unemployed persons and the difficulty of
reducing the rate of unemployment. There are a range of factors that
contribute to the problem of unemployment, including the fact that
many unemployed persons have relatively low levels of skill and work
experience.
The fact that the South African economy is not very labour intensive
poses a further challenge and limits the options available for short
to medium term interventions.
The structural nature of the countryâs unemployment challenge has been
exacerbated by the effects of the recent global economic challenge and
the recession in South Africa during 2009.
(2) In order to prevent massive job losses the Department of Labour was
involved in the task team that worked on the Economic Crisis Response
Framework. In this team we played a crucial role in the development
and implementation of the Training Layoff scheme. In this programme
the companies that are in distress and considering retrenchments are
encouraged to reach agreement with workers around the implementation
of a training layoff scheme. The scheme allows companies to be
assisted to keep workers and retrain them in skills that are seen as
having potential after the down turn. In doing this, thousands of jobs
had been saved since the last quarter of 2008 to date.
⢠The Department of Labour, through the Response Framework team also
contributed to the IDC, a developmental fund aimed to offer financial
assistance to companies for economic growth purposes. A total of R2
billion had been invested there to help struggling companies and to
train some of their employees instead of retrenching them. This
training has helped re-skill these workers so that when the economy
pick up again, they are easily incorporated back into the labour
market. The training that workers are receiving will not only help
improve their chances of being incorporated back into the labour
market once pick up, but will also improve productivity.
⢠As a result of massive job losses the DoL has, through the Public
Employment Services targeted all vulnerable groups for labour market
re-entry programmes. Through this unit we register job vacancies and
work seekers and match them up so that employers looking for workers
can get people and vice versa. This system is also aimed at offering
career counseling and other related labour market information.
⢠Another area that we are currently working on to help curb the job
loss and bring people onto the labour market is through supporting
Worker cooperatives: We are in the process of developing a strategy
that will help the DoL to support people or groups that want to start
up worker cooperatives.
(ii) In addressing productivity in the job market to create meaningful job
growth and labour market efficiency, the Department of Labour is
working closely with companies through Productivity South Africa
(PSA). PSA assists companies in becoming competitive so that their
products can stand against the best in the global market. These are
done through collaborative Research and Development, innovation
support as well as assisting in skills development aimed at making
companies more competitive.
(3) The level of skills available is one big factor because the countryâs
skills profile is not competitive at all with the giants in the
industrialized economies, as such we are unable to match best
countries in the products development that call for high level skills.
This can be seen in our inability to beneficiate our resources and
create more jobs over and above retaining the one created in the
development of the resources in the first place.
The cost of searching for jobs is resulting in most of the unemployed
being discouraged from further job search because most opportunities
are available in the cities and metros. Majority of work seekers are
from the former homeland and rural areas and the centrality of job
opportunities in city centers make it difficult for the first to know
where opportunities are because they will have to travel long and
expensive distances or else have to stay in cities to be able to
search for jobs.