One million more unemployed since the fourth quarter of 2008
Figures released today by Statistics South Africa show a 0.9% increase in unemployment in the first quarter, to 25.2%. This means that 171 000 jobs were lost between the fourth quarter of 2009 and the first quarter of 2010 (see here - PDF). The further rise in unemployment is particularly concerning given that there are signs of recovery elsewhere in the economy.
Since the fourth quarter of 2008, unemployment has risen 3.3%; this amounts to one million more unemployed people in South Africa over that time period.
It is also important to remember that these figures use the narrow definition of unemployment; they naturally, therefore, exclude discouraged jobseekers, and thus do not present a picture that shows the full extent of the jobs crisis in this country.
What these figures show beyond doubt is that the ANC has no coherent strategy to tackle unemployment.
The SETAs don't work. They are outdated institutions that cannot respond to the skill-sets needed in a dynamic marketplace. If markets are to drive employment creation in South Africa, then a market-centred, rather than state-centred employment creation tool is needed.
This is why we will continue to argue for a new apprenticeships programme, and for a wage subsidy plan that encourages employers to take on new staff and invest in on-the-job training. This market-based approach has the critical advantage of allowing employers the flexibility to train potential employees with the skills they actually need rather than have those skills dictated by the state.
Though the minister of finance recently committed this government to a wage subsidies policy - after years of denouncing the DA's proposals for precisely such a plan - there has been far too little progress in it to date.
That is because the ANC continues to rely on the Expanded Public Works Programme (EPWP) as a way of employing people. Yet that has clearly failed. The Zuma administration trumped the EPWP as a way of employing people during the recession, yet we ended up losing 870,000 jobs last year. Meanwhile, 487,000 "job opportunities" were apparently created, but these were temporary, paid poorly, and did little to stave off any of the real effects of the recession. Most problematically of all, they in fact only amounted to the equivalent of about 87,000 real jobs.
Finally, we need to tackle our massively problematic labour legislation, which makes it practically impossible for firms to hire and fire. When firms can't reliably know that they can dismiss those who are incompetent, they tend not to take the risk of hiring in the first place. Economies that are dogged in labour legislation like South Africa have far higher unemployment, and they struggle to attract investment, which only compounds the problem. They also tend to shift towards more capital intensive modes of production. All of this creates a descending jobless spiral - and South Africa is currently plummeting down it.
Statement issued by Ian Ollis, MP, Democratic Alliance deputy shadow minister of labour, May 4 2010
Click here to sign up to receive our free daily headline email newsletter
