Clothing and Textiles: New wage model should be emulated in other sectors
The special wage deal between the South African Clothing and Textile Workers' Union (SACTWU) and textile sector employers to lower the cost of hiring new workers is already paying off. A Cape Town-based manufacturer has announced plans to add 100 new staff to its operations, a 25% growth in personnel numbers for the firm. This is an excellent sign, showing that creative wage deals like this can lead to job creation. The Democratic Alliance (DA) is in support of any initiative that lowers the cost of employing new workers. We believe that this particular initiative should be emulated in other sectors to help tackle our unemployment crisis.
We hail SACTWU for having the courage to pilot this deal in the textile sector, which has been hammered by job losses over the last decade. It has become clear that part of the reason for our lack of competitiveness in this sector stems from the relatively high wages paid to unionised textile workers compared to the wages paid in China and other direct competitors in this market. With this wage deal, new workers will earn a lower salary than established workers, which solves two problems: the need for lower textile production costs and the need for greater job creation. It's a win-win solution.
A similar deal was brokered in the leather footwear sector a few years back, which had a positive effect on employment similar to that being experienced now in the clothing sector. This approach should be emulated in other manufacturing sectors where there are bargaining councils that could negotiate a similar deal, such as the Furniture Manufacturing Industry, the Furniture, Bedding and Upholstery Industry, the Knitting Industry, the Carpet Manufacturing Industry and the Cotton Textile Processing and Manufacturing Industry.
According to President Jacob Zuma, 2011 was going to be "the year of the job." Unfortunately, it has actually turned into "the year of job losses." In August alone, South Africa lost 49,000 jobs, just some of the hundreds of thousands that will be lost this year. But this enterprising wage deal, which was brokered between unions and employers, could be replicated across many other struggling industries that we rely on for mass job creation. We hope other unions have the courage to follow SACTWU's lead in this regard.
Statement issued by Tim Harris MP, DA Shadow Minister of Trade and Industry, October 10 2011
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