29 000 mining job losses just the beginning unless there is drastic change in the industry
23 March 2016
29 000 jobs have been lost in the mining industry between December 2014 and December 2015, according the Quarterly Employment Survey. This amounts to a decrease of 5.9% in employment in the industry. 14 000 of these jobs were lost between September and December 2015. This trend is likely to continue if nothing is done to arrest pervasive uncertainty in the mining sector immediately.
It should be recalled that behind each of the 29 000 workers who have lost their jobs over that 12 month period is an entire family depending on their support.
The ANC government will, of course, blame global economic conditions. Although these factors play a role, the truth of the matter is that government has failed to provide much needed leadership to mitigate the dire situation in which this sector currently finds itself. The sector is under siege from every quarter: chief amongst them soaring electricity and labour prices. Further strangling the industry is burdensome overregulation of the sector and an inefficient Department of Mineral Resources (DMR) which often takes years to issue a single mining license.
Policy uncertainty scares off any other potential investors who remain, as the poorly drafted Mineral and Petroleum Resources Amendment Bill (MPRDA Bill) languishes in parliamentary doldrums. Instead of reviewing and finalising the Bill, government has instead indicated that it will fast-track a new State Mining Company Bill in which the Minister of Mineral Resources will both be sole shareholder in the company as well as grant it mining rights. Until these factors are dealt with, we can expect further job losses, particularly in current economic conditions. Some estimates on imminent job losses are as high as 100 000.
The only job losses government can claim it has saved is an estimated 3 000 jobs at the Optimum colliery. This mine was in business rescue and on the brink of closure. However, after it was bought by the Guptas, in a deal apparently negotiated by Minister of Mineral Resources Zwane himself on his now infamous trip to Switzerland, Eskom suddenly cancelled its deal with Exxaro colliery and gave it to the now Gupta owned Optimum instead.
If the mining industry, and the hundreds of thousands of people who rely on it for an income, are to survive, government needs to stop looking for ways to line its own pockets, and those of the Guptas, and look to saving the industry as a whole instead.
Issued by James Lorimer, DA Shadow Minister of Mineral Resources, 23 March 2016
