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A blurred picturePresident Jacob Zuma has released a statement summarising the latest report back by the Leadership Group on the "Framework Response to the Economic Crisis". While President Zuma has listed a number of successes in this regard, the statement also tends to mask a few other less successful outcomes, particularly in the employment sphere. South Africa seems to be far from out of the woods on this front.
As Congress of SA Trade Unions (Cosatu) general-secretary Zwelinzima Vavi rightly points out, South Africa did respond to the world economic crisis in ways not equalled by many other countries, if any, when it comes to protecting its workers. However, when the response to the global crisis and the government’s attempts to fulfill its election promises on job creation are stirred into the same mix, the picture becomes quite blurry.
It is in this area that Zuma is engaging in that sleight of hand so loved by politicians everywhere – making the statistics fit the story – when he implies that the government is succeeding with its job-creation goals and has created 223 568 jobs in the second quarter with its Public Works programme.
In the last general election, the ruling African National Congress (ANC) made the rather tall promise to the electorate that it would create 500 000 jobs by the end of this year and 4.5 million jobs by 2014.
The closer this year drew to its end, the less likely it seemed the promise would be fulfilled. Yet, only last month Public Works Minister Geoff Doidge said the government was confident it would still create those 500 000 jobs before the end of 2009 – now less than a month away.
The job-creation situation, however, remains in dire straits, while the recession has exacted a far bigger toll on employment than readily is being admitted. And the response by government, labour and business to the recession-linked threat to jobs seems inadequate.
Firstly, the 223 568 “jobs” to which Zuma refers, are merely temporary work or poverty-relief opportunities. Very few of the Public Works programme’s temporary work opportunities, if any, result in real long-term or permanent jobs with a decent and steady income.
Perhaps realising this, Doidge, when he recently made his announcement, now repeated by Zuma, was more careful with his choice of words when he referred to 223 568 “work opportunities” – rather than jobs – having been created through the Expanded Public Works Programme (EPWP) from 1 April to 31 August.
However, Zuma was able to mention, as part of the report back, that the government managed to save 4 482 jobs from March to September this year through its Training Layoff Scheme (TLS) – a programme introduced to train workers whose jobs are being cut. In addition, he said, the Industrial Development Corporation (IDC) saved a further 7 700 jobs by approving loans worth R2.1 billion rand for 33 companies in distress.
While both these successes are not to be scoffed at, the figures could have been better considering the high number of people who did lose their job due to South Africa’s first recession in 17 years. The TLS failed to get off the ground fully as originally envisaged, and is being reviewed.
While Nerine Kahn, director of the Commission for Conciliation, Mediation and Arbitration (CCMA) – which is administering the scheme on behalf of the Department of Labour – says the scheme has by no means failed, she did acknowledge that suspicious workers presented one of the major problems encountered by the scheme, causing at least three companies to withdraw their applications for TLS assistance.
Furthermore, only some 35 companies have to date approached the CCMA for TLS assistance. Of these, only seven requests have been processed by the CCMA, of which five have been recommended for assistance. The rest are in various stages of negotiations with the CCMA.
But the scheme definitely has longer term promise if the unnecessarily complicated red tape, worker suspicions and other limitations can be addressed adequately.
Meanwhile, however, if one looks at the various employment-related statistics released by government agencies this year, Zuma’s 223 568 Public Works programme “work opportunities” seem rather insignificant.
Consider, among these statistics, the following:
· The number of people with jobs fell by 484 000 to 12.9 million in the third quarter;
· South Africa had 770 000 fewer jobs in the third quarter compared with the same period last year;
· The unemployment rate currently stands at 24.5%, up from 23.6% in the previous quarter;
· This year, 1.07 million jobs were lost despite initial estimates of 400 000, according to a recent official figure;
· However, the latest official tally somewhat confusingly puts South African job losses at 959 000;
· Nearly half a million jobs were lost during July and September this year, being the largest fall in one quarter in 20 years; and
· One out of every 18 jobs has been lost so far this year.
While Zuma uses the Public Works opportunities to indicate that half of the promised 500 000 jobs has been created, this is a little ingenuous. Even if these are accepted as 'jobs', they have been more than cancelled out by the loss of over a million jobs – real jobs.
Not negative
While Zuma said in his statement that without the measures of the "Framework Response to the Economic Crisis", the impact of the recession would have been more severe, and added that they also form the basis for the future.
Indeed these measures – to prevent job losses and the other measures such as financial bailouts for companies in distress – will most likely have a more beneficial impact over the longer term than they did in the more immediate context of countering the effects of the global recession.
The government centred most of its anti-recession measures around its R787-billion investment in the infrastructure programme. For example, while the immediate objectives of the job creation/job-saving initiative largely did not deliver as anticipated, the programmes established for that purpose, together with the spin-offs from the infrastructure programme, will undoubtedly save many jobs and create many new ones over the longer term. These programmes will hopefully by then have been fine-tuned with all the glitches and confusion sorted out.
Meanwhile, Zuma indicated that additional work opportunities have been created in the Public Works programme, which will be announced by the Minister of Public Works once verified. He said special loans that the IDC made available to distressed firms from a R6.1-billion fund have saved 7 700 jobs.
Present when Zuma made the latest announcement, Doidge said 89 000 verified jobs were created across all three spheres of government in the first quarter of 2009. This was followed by 235 000 work opportunities in the second quarter. Echoing Zuma's words, Doidge said additional work was being created, but that the numbers still needed to undergo a verification process.
"What we want, is that when we release the final figure, it must stand the test of any audit process that may be carried out there," he said, adding that the national government was working on a plan to improve the verification process. However, Doidge’s figures do not tally with Zuma’s 223 568 “jobs” created on the Public Works programme.
Nonetheless, while Zuma’s announcement may have hidden the stark realities of the real picture somewhat, his statement did make a brief return to reality when he added toward the end that “we may still lose more jobs before we turn the corner on job creation”.
“Nearly a million people have been cut loose by the crisis, and many of them have families that depend on them. For this reason, we cannot yet say that the implementation of the Framework Agreement is complete,” said Zuma.
