THE ECONOMY HAS STILL NOT RECOVERED PRE-COVID JOBS

SAFTU NOT HOPEFUL

Though the unemployment statistics for quarter 4 of 2022 show a minor decline, the South African Federation of Trade Unions (SAFTU) remains doubtful that we have entered a trajectory of growth for employment. The Quarterly Labour Force Survey (QLFS) shows that the expanded unemployment has declined by 0,5% from 43,1% in the third quarter to the 42,6% in the fourth quarter of 2022.

Unemployment, in the narrowed definition declined by -0,2% from 32,9% in the third quarter to 32,7% in the fourth quarter of 2022. Reflecting the structural nature of this unemployment, the long-term unemployment rose from 5,9 million to 6,1 million. The trough of long-term unemployment rose from 3,2 million in 2012 to 6,1 million today.

Expanded unemployment amongst the youth between the ages of 15 – 24 years has declined to 71.1% (2,5 million), and to 49.5% (4,4 million) amongst the youth between the ages of 25 – 34 years. There are 8,9 million young people between the ages of 15 and 34 that are not in any form of employment, education, and training.

By population groups, the expanded unemployment rate amongst black people is 47,3%. Expanded unemployment rate among black women is still above 50% (at 51,0%) and 43.9% among black men. Unemployment rate among black men and women is above the average rate.

Unemployment in retrospect

The declines in unemployment came heavily from mining and others including utilities, finance and transport.

Agriculture continued to shed jobs, shedding 12 000 from the third quarter to the fourth quarter in 2022. As we noted in November 2022, “the decline and rise of employment in agriculture partially comes from the seasonal cycles in work in the crop farming sector, which usually declines after cultivation and harvesting period. In addition, the structural factors that lead to decline in numbers of agricultural workers is the decline in a number of farms, and centrally, the gradual use of machines that has come to replace more labourers.”

Though employment in private households has increased, it is still dismally behind in terms of recovering the jobs from the fourth quarter of 2021. First affected by Covid-19 loss of income to many working-class households, the low levels of employment recovery in the private household sector are continually proliferated by the rising cost of living due to rising inflation and interest rates.

Overall, the whole economy has not recovered 486 000 jobs from the fourth quarter of 2019.

Like we noted in our November statement, the other causes that are sustaining the “obscene levels of unemployment” despite the economy’s production levels returning to pre-Covid levels, “has been the investment strike by capitalists, including reduced investment on the part of the government as a result of the austerity fiscal framework.”

In the recent macroeconomic outlook by the Treasury, the growth of the gross fixed-capital formations (GFCF) is projected to grow by 1,3% in 2023. This is a decline of 2,9% compared to the estimate of GFCF in 2022. From 2015 onwards, the government investment in public services and its companies began declining gradually until today.

In addition to low levels of investment, the changing character of work due to the introduction of machinery poses risk to employment. Consequently, this means unemployment is a present and future reality. Moreover, the transition to climate friendly methods of production, if not conducted in a just manner, poses risk to millions of jobs especially because they change the nature and character of work. The trade union movement must safe-guard this energy transition to ensure that jobs made redundant by the climate-friendly new methods of production are replaced by climate friendly jobs, manifold.

Suggested solutions

The neocolonial character of this economy is also detrimental to the possibility of job creation in this country. Continuing the legacy of colonialism in which mineral resources were reaped to create secondary industry in capitalist metropoles, secondary industries have not been developed to process the minerals here at home into finished products. As a result, the minerals continue to benefit the people in the capitalist metropoles of Europe and America.

SAFTU is calling on the government to lead the re-industrialisation programme, the primary target of which should be to create secondary industries to process the mineral resources that are dug in the belly of our country. This will lead to a two-pronged beneficiation: 1) the creation of employment and 2) ensuring that mining communities get social, recreational, and cultural developmenta from the mines that plunder their lands and cause environmental degradation. Our allied organisation, the Mining Affected Communities United in Action (MACUA), has been campaigning for these issues since its inception.

Further, we have called on the government to implement a job guarantee scheme which will provide unemployment for those workers who are displaced by retrenchments because of new machination and sheer profiteering agenda.

It is still our view that “this will not only create jobs but will also put money in the pockets of workers. The advantage of putting money in the pockets of workers is that it will stimulate aggregate demand, which, if not exploited by capitalists to multiply monetary earnings through higher prices, will lead to expansion of production and hiring of more workers.”