Sherilee Bridge and Ferial Haffajee
The stronger gold price is no guarantee the haemorrhaging of jobs in the mining industry will cease, although trade unions are likely to use it as a bargaining tool.
The National Union of Mineworkers said this week it will begin to negotiate the recall of thousands of retrenched workers and those who had been put on long leave since gold’s meltdown last year.
Despite the huge job losses, more than 27 000 jobs on nine marginal mines are still officially in danger. Because in the past the industry has linked the dwindling price to the need for retrenchments, trade unions want a similar connection to be made now the gold price is strengthening.
But improved revenues are unlikely to lead to new jobs. Instead, the mining industry is restructuring for long-term growth, and this means ploughing spending into deep- level mining. There will be few new operations, and many mining companies are moving offshore to Latin America and parts of Africa where costs are lower. Others which list overseas, like Anglogold, must now pay dividends in hard currencies.
Mining analysts say the nose- diving rand may be good news for marginal mines, but the windfall may be short-lived. Last year eight of the nine marginal mines lost about R369-million.
Roger Baxter, senior economist at the Chamber of Mines, says the future of the 116 000 people employed on marginal mines last year cannot be based on short-term fluctuations in the gold price: “While the exchange has provided some degree of relief, the industry must continue to focus on cutting operating costs and sorting out productivity levels for longer-term stability.”
Anglogold representative Kelvin Williams says there should be a greater measure of security for marginal operations. “Certainly there will be parts of the industry which will still be vulnerable, and we may still see job losses as the industry continues to rationalise. However, jobs in general should be more secure.” He warns that mines must still keep costs down.
The waves of retrenchments in the past decade as gold has lost its glitter – down from 50% of total export value in 1980 to 18% last year – have wrought a destructive path through South Africa and its neighbouring economies. “[They have] had a massive impact, much of it displaced into rural areas,” says Kate Philip of the Mineworkers Development Agency (MDA).
Many areas survive on miners’ wages. In 1997 more than R11-billion in miners’ wages was sent to their rural families. The MDA runs programmes to help retrenched miners invest their packages in small businesses. “But we don’t even begin to reach all those affected,” says Philip.