Trade unionists and industry heavyweights have poured cold water on a claim by a leading South African economist that South Africa is entering a “golden era” of rising employment.
Michael Schussler, the CE at T-Sec, said that, for the first time since 1982, the country was enjoying “massive employment growth at 1 400% quicker than America’s monthly employment growth”.
His claims are based on the release of two surveys this week by Statistics South Africa (StatsSA). The latest Labour Force Survey (LFS), a biannual assessment of 30 000 households, shows that the number of people with jobs was 363 000 higher at 11,9-million in March this year than last September. Employment steadied for the six months to March, dropping slightly from 28,4% to 27,8% — a 0,6% difference. Â
The Survey of Employment and Earnings, a quarterly survey of 10 000 private businesses and public institutions registered with the South African Revenue Service, showed an increase of 195 000 jobs over the past year.
But, Congress of South African Trade Unions economist Neva Makgetla is sceptical. “The claim that the country has the largest increase in employment in percentage terms since 1982 is worrying. The economy has not been performing like that — so something is wrong. Surveys are always unreliable. The issue for me is to find out how unreliable they are.”
Economic activity in the second quarter of this year rose at an annual rate of 3,9%, which according to Iraj Abedian, CEO at the Pan African Advisory Service, “should be creating jobs”.
Nevertheless, “the question is whether the types of jobs being created and the skills requirement for these match the profile of the unemployed and new graduates . That is the acid test of our success.”
Critics said this was the flaw in Schussler’s argument. Although he claimed that 60 000 jobs were being created every month in South Africa, the LFS shows that the economically active population increased by 317 000 to 16,6-million in March compared with September last year. The economy may be growing — but not fast enough to cater for the number of new job market entrants.
“The increase of 363 000 jobs during the past six months is statistically insignificant,” said Ros Hirschowitz, deputy director general at StatsSA.
According to the employment and earnings survey, the annual percentage employment growth a sector to June was 2,43% in the manufacturing sector, 9,52% in mining, 4,19% in wholesale and retail and a 3,63% growth in financial and real estate. The only sector that shed jobs was construction, which lost 9,46% of its work force.
Ebrahim Patel, general secretary of the South Africa Clothing and Textile Workers Union, said there was an jobs bloodbath in the textile industry, which had accelerated in the past 12 months to 1 300 jobs a month. “During the past 36 months 178 factories have closed, an average of five per month. The appreciation of the rand, coupled with trade liberalisation, has resulted in a flood of cheap imports into the country. Last year alone, imports of clothing from China rose by 110%, destroying about 20 000 jobs,” he said.
Michael McDonald, CE at the Steel and Engineering Industries Federation, said that the apparently buoyant employment figures were “unlikely”.
Job creation was being  counterbalanced by job cuts “as industries close and people move into the informal sector. In the metal industry we are not creating many permanent jobs and there is a massive 11% to 15% growth in atypical employment.”
Director of employment and policy research at the Human Sciences Research Council, Miriam Altman, said that in contrast to LFS claims, mining jobs “have been steadily declining over the 1990s”.
Although there was growth on the platinum mines, it was “too small to affect employment trends”.