Jobs front cynicism as the debates continue

Posted on February 10, 2012


Trade unionists the world over celebrate any decline in unemployment. But many local trade unionists may be forgiven for being rather less than enthusiastic about the latest Labour Forces Survey (LFS), despite claims that it reveals the lowest jobless rate since June 2009.

Released on Tuesday, two days before President Jacob Zuma’s state of the nation address, the LFS is, understandably, being punted optimistically in government circles. On the whole, the labour movement takes a more cautious view.

In the first place, many trade unionists are wary of official statistics regarding employment, understanding that they can be influenced by political and other considerations. They also tend to subscribe to the view that, all too often, there are lies, damned lies and then there are statistics.

This applies in particular to official estimates of unemployment — especially at times of economic crisis and growing joblessness. The timing of the release of the latest LFS results also caused some wry comment.

There was speculation about whether the results might not have been delayed until after the state of the nation address, had they provided a more negative set of figures. As it is, a close look at the LFS hardly inspires confidence, for all the publicity about the unemployment rate having fallen to 23.9 percent.

This is the figure calculated on a narrow basis that excludes “discouraged” work seekers. However, it does provide a political straw that can be spun into a claim that a turn-around has begun and that measures taken by the government are starting — albeit slowly — to work.

“It’s not enough, but it does mean that 179 000 more people will be earning something,” says Federation of Unions of SA (Fedusa) general secretary Dennis George. However, he adds that this figure — “even if sustainable” — is only about half the number needed.

Cosatu, however, was quick to point out the difference between the “narrowly calculated” 23.9 percent and the “more realistic expanded figure” included in the LFS. This paints a rather different picture: there has been a marginal decline in joblessness of 0.6 percent, meaning that nearly 36 percent or 7.5 million men and women are still, officially, without work.

Even this figure is regarded by the labour movement as an under estimate because of the ongoing dispute about definitions of employment. Should the “working poor”, those people listed as employed, but who earn less than R1 000 or less than R500 a month be regarded, in the strict sense, as wage earning employees? And should small-scale informal traders, selling a few oranges or sweets on a street corner qualify as employed? Officially, they do.

Union estimates are that more than 30 percent of workers now listed as employed, earn less than R1 000 a month with perhaps half their number taking home no more than R500. If these numbers are added to the officially acknowledged list of those without jobs, the warning by Cosatu general secretary Zwelinzima Vavi about a “ticking time bomb” seems even more frighteningly accurate.

Yet despite some muted murmurs of optimism, there seems to be a growing consensus across the board that agrees with the assessment last year of US economist Nuriel Roubini, a one-time adviser to the International Monetary Fund. He maintains that the world stands poised between the possibility of an ongoing recession or a collapse into a major depression.

Jobs therefore become an even more critical issue and, in a South African context, throw into sharp relief, the whole question of labour brokers and attitudes about them. Cosatu has announced a general strike for Wednesday, March 7 to call for the banning of labour brokers and for and end to e-tolling in Guteng.

Cosatu spokesperson Patrick Craven explains: “We are not opposed to temporary employment agencies. We are opposed to those who abuse the system.”

This is in line with what this column has stated over recent years about labour brokers. In October 2009, it was pointed out: “In law, the end employer who hires a broker to supply labour, hires the employees of the broker. The broker is, therefore responsible, under the labour laws, for the pay and conditions of the workers outsourced to other companies.”

As has also been regularly pointed out, any broker or agency that does not provide all the usual rights and benefits to workers is breaking the law. But this law is broken regularly and with impunity — along with others pertaining to health and safety and basic conditions of employment.

Such breaches are not the fault of the law; they happen because the laws are not enforced. Which is not to say that the laws as they stand do not need improvement. With regard to section 198 of the LRA, the definition of an independent contractor probably requires clarification.

Unscrupulous labour brokers often maintain that they are mere agents for such “independent” contractors; that every individual seeking any temporary employment, qualifies as an independent contractor. This is clearly nonsense; it is the argument of the free market fringe who decry all regulation.

And calls for no regulation are only one step away from those for self-regulation, a position adopted by the main parliamentary opposition. But a consensus seems to be growing for the temporary labour industry to be “strictly regulated by the social partners, by government, business and organised labour”. State labour exchanges may well be on the cards.

This greater involvement of the state also once again raises the question of nationalisation, capitalism and socialism raised here two weeks ago. It caused Dan Gallin of the Global Labour Institute in Geneva to send the email comment: “State ownership is not the issue, democratic control of production is.”

At the same time KZN reader, Ken Carstens, passed on a comment made by a Latin American diplomat at the COP 17 conference in Durban. Discussing nationalisation, the diplomat argued: “One has first to nationalise the state”.

So it is not just a case of a luta continua, but also of a debate continua.