Manufacturing sector continues haemorrhaging jobs

27 August 2014

Today, manufacturing sector advocacy group, Manufacturing Circle, revealed that 59000 jobs have been lost in the manufacturing sector in the second quarter of the year.

This follows the release of economic data indicating manufacturing industry shrank by -0,3 percentage within the second quarter.

Manufacturing Circle represents 36 major industry players within the manufacturing sector.

Since 2008, Manufacturing Circle claims that the industry has shed a total of 250 000 jobs - a sure indication that this traditionally labour intensive industry is failing to generate jobs for millions of South Africans.

Confidence in the sector is clearly also on the decline. A survey conducted by the organisation reveals that only 2 % of respondents perceived the manufacturing sector to be in good condition. This is a drastic decline from the 12 % recorded amongst companies the same time last year.

In the first quarter of 2014, manufacturing employment shrank by 4.4%, and between September 2006 and 

March 2014, 188 000 South Africans employed in the manufacturing sector lost their jobs.

Causes for the industry's failure are clear; government's confused approach to the National Development Plan, unstable labour relations and weak investor confidence driven by government's inaction.

With the right kinds of intervention, the DA believes that the inclusive economic growth can be achieved.

The DA has already proposed the following key interventions to turn the sector and economy around:

Government must provide political leadership and restore investor certainty by speaking with one voice and implementing one plan on the economy;

Boost trade with the rest of Africa through trade-focused diplomacy and cutting the costs of trading across borders;

Investing 10% of GDP in infrastructure to reduce the cost of doing business; 

Reducing the red tape that makes it so hard to establish and operate a business in South Africa, with a specific focus on a streamlined small business regulatory system for registration, labour legislation and empowerment regulations; and

Working with the Department of Labour to reform labour legislation, in particular making it easier for small businesses to opt out of bargaining council agreements negotiated by big business and big unions.

Government must put its money where its mouth and act swiftly to turn the industry around now before matter worsen and even more South Africans are left without jobs.

Statement issued by Dean Macpherson MP, DA Shadow Deputy Minister for Trade and Industry, August 28 2014

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