The Jobs Summit must ensure the creation of jobs in a fast-changing, multi-layered economy. A trip down a Johannesburg city street shows just how diverse an economy it is, writes Ferial Haffajee
The disappearing economy
Fourty-four Main Street is the headquarters of the Anglo American Corporation, where an imposing bronze door greets visitors. Yuppies in executive blue shirts run down the stately stairs of the building that fills an entire city block. At the end of March, Anglo announced headline earnings of R5-billion. With a market capitalisation of R54,5-billion, the corporation is still king of the South African economy with its mining, financial service and diamond interests.
But Anglo and other companies in the financial district of Main Street are moving their capital overseas by listing mainly on the London Stock Exchange. The buildings will stay but the economy of this street and the country will change fundamentally with the capital flight.
South Africa’s mining industry has its home in the grand old buildings around Main and McLaren streets. But they are a symbol of gold’s high age – the industry is in a slump in which almost one in three jobs have been shed.
The Anglo executive is fast giving way to the informal parking attendant on Main Street where women like Jabu Sithole wear aprons sponsored by Fedsure and eke out a meagre living. “There’s no money in this place,” says Sithole between directing cars. “I make R15 or R20 a day but I must pay R5 a day for this apron.”
Dean Butts of the Hollard Arms restaurant, where remaining executives dine in old-world charm, says there has been “a drastic slowdown” with the exodus of bankers and brokers. Butts’s restaurant is still full at lunchtime. But further down Main Street the changing economy has claimed the Carlton Hotel.
The grande dame has been moth-balled and its chandeliers and red carpets are barely visible through the steel fence erected to keep the homeless at bay.
Economy of crime
The Johannesburg Magistrate’s Court stands sentinel over Main Street, one of Johannesburg’s oldest thoroughfares, where the new South Africa’s hawkers and homeless have made a visible stamp on the court’s post- Edwardian elegance.
Outside Court 14, there is a buzz where the trial of 10 police officers will take place. All members of the South African Narcotics Bureau, they have been charged with drug-dealing. The officers are nattily dressed in Pierre Cardin slacks and new wrap- around Ray-Ban sunglasses.
The fragile-looking prosecutor in Court 14 wades through files of robbery, burglary, theft and murder charges. Young black and coloured foot soldiers of the criminal economy trundle up from the cells as the orderly announces the type of case: “Roof. Moord. Huisbraak. [Robbery. Murder. Burglary.]”
Wives and mothers with sad eyes ply their sons with fruit, cigarettes and cups of coffee. Their makweras (the barons of organised crime) have sent lawyers for them.
Johannesburg is the leader of a growing, highly organised national criminal economy. Last year the city notched up the highest number of reported burglaries on suburban homes and city businesses, shoplifting, car theft and theft from cars.
Antoinette Louw of the Institute for Strategic Studies says that nobody has yet managed to quantify the criminal economy. Such a price tag must take into account the pickings of crime like the value of cars and goods stolen and drugs traded. It must also tally the human costs to families of the loss of breadwinners and national costs like lost investment opportunities. The magistrate’s court shows that this economy is booming.
The new economy
Next door at the Carlton Centre, the public relations officer says the mall is “bumping” with 1,1-million mostly young daily visitors. But about one in three shops is empty – testimony to the limited buying power of the young where almost one in three cannot find work.
Around the country, some have found jobs in provincial departments like Gauteng’s Department of Economic Affairs building on Main Street where buppies with cellphones strut their stuff. The public service is the only economic sector where a significant number of jobs have been created in the past five years – it grew by 10% between 1990 and 1996.
Wiphold, the women’s company with headquarters on Main Street between the economic affairs department and Anglo American, is the quintessential new South Africa company. Its board of directors is a rainbow crew of leading women from Wendy Appelbaum to Louisa Mojela. In the past four years it has traded on its gender credentials and business suss to create a medium-sized holdings company worth R1-billion. On the Johannesburg Stock Exchange, this type of empowerment company is rapidly winning bigger stakes – but it doesn’t create many jobs because it invests in existing companies.
Walk along Main Street and other parts of the new economy paint a less optimistic picture. Loan sharks have set up shop and are doing a roaring trade among the desperate.
And hawkers sell Taiwanese takkies and cheap clothes. Rapid tariff reduction in the past four years has meant the flood of cheap imports has distressed the local clothing and textile industries, leading to huge job cuts.
The future economy
Outside Wiphold, gap-toothed Grace Mathebula fries vetkoek and sells them to loyal customers who drop by every morning. In the afternoon she shifts trade to her fruit and sweet stall. Her 18-month-old son, Gift, is a natural salesman whose charming gurgles and frenetic first steps make pedestrians stop to buy. Mathebula says business is good: she makes R50 on an average day, though the end of the month is always better. These are the “extra-mile” people, says Sharda Naidoo of the Alliance of Micro- Enterprise Development Practitioners, which trains, finances and mentors entrepreneurs like Mathebula.
In Latin America, it is this sector that is creating the most jobs. The alliance says that while half-a- million jobs have been lost in the formal economy, about two million of these “extra mile” people earn a living from small and micro- enterprises. The empty buildings that line Main Street could easily accommodate the services which this sector desperately needs to expand and replace the jobs lost in yesterday’s economy.
“While it is obvious they are here to stay, their contribution remains relatively unacknowledged in the mainstream,” says Naidoo. Soon, she maintains, they will be the mainstream.
If Naidoo thinks small, then John Spiropoulos is the keeper of the big picture. He is a project manager of a Department of Trade and Industry plan to make Gauteng the primary node in a new manufacturing and service economy which will replace the losses in mining and manufacturing so apparent on Main Street. On his drawing board are plans for an inland port near Kaserne and an “innovation highway” of new information technology, media and service companies stretching from Midrand to the south of the city just near the courts.