Slow employment growth:  Policy uncertainty to blame

The Democratic Alliance (DA) notes the release of STATS SA's employment statistics for the first quarter of 2011. The numbers indicate a small (0.6%) increase in the total number of employed people in the first quarter of 2011. Although any increase is welcome, it is common knowledge that we require significantly higher employment growth to overcome our enormous unemployment challenge, especially amongst young people.

It is in this light that recent policy debates, and the growing degree of uncertainty about South Africa's future economic policy framework, are especially concerning. We need a clear and coherent policy framework that will allow us to maximize our rate of job creation - and a plan to open up opportunity to the youth.

The Zuma administration has declared 2011 the year of job creation - and has initiated several promising interventions, such as Minister Gordhan's jobs fund. The DA supports this focus on job creation and has expressed support for measures aimed at creating incentives for increased employment growth.

Unfortunately, however, the Zuma administration has not been able to keep its broader house in order on this issue. At the same time that the Minister of Finance has been drawing up new employment creation plans, the Minister of Labour has initiated a review of our existing labour legislation that would in all likelihood make labour laws even more stringent, thus discouraging job creation.

The ANCYL's rhetoric about the nationalization of mines and banks, as well as the transfer of property without compensation, has also raised questions about our future economic direction and continued viability as an investment destination.

South Africa needs a stable and sensible macroeconomic climate, coupled with appropriate interventions to increase job creation and skills development. The DA has already suggested several such interventions. These include a wage subsidy, a tax rebate for skills development, opportunity vouchers for young people, a tax holiday for newly established small-scale enterprise, increased investment in infrastructure development and maintenance, and additional support for SMMEs. These interventions will help to increase our rate of employment growth significantly - especially for the youth. And that is why the DA will continue advocating such policies.

The Zuma administration, and the ANC as a whole, have failed to articulate a consistent vision for job creation and economic growth, and that is why we are creating jobs at the slow pace indicated by STATS SA today. South Africa needs a coherent approach that opens our economy to do business with the world. This is the only viable vehicle of empowerment for our youth.

Statement issued by Makashule Gana, DA Youth Leader, June 21 2011

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